As a third-party intermediary, there are certain things to accomplish before becoming a freight broker agent. Here is the list of the things you must remember and carry out to jumpstart your career in the freight brokering business.
Freight Brokering and Freight Broker Agents
- Experience in the transportation industry and working for a manufacturer or trucking company is a natural first step. You will gain sufficient information and understanding about the entire operation if you have experience in the industry.
- Freight broker agent training and freight broker books available online will provide knowledge and strategies for marketing, sales, operations, and licensing in the transportation industry. Taking advantage of online classes will help you practice and learn the fundamentals of the business. Parallel to in-classroom training, you can obtain an overview of the career and the regulations surrounding the industry.
- Strong communication skills are a plus factor in becoming a successful freight broker agent. You have to develop a far-reaching contact list. Having a network of shippers and truckers can help you build your customer base. By talking to them, you can establish a constant business relationship.
- Establishing a good reputation and proficiency in the field locally is also important. You can geo-target your business by focusing on a particular region or city. You can also evaluate the market demand for specialized services like heavy loads, perishable goods, or fragile items.
- You have to discover your shipper’s needs and desires. Make sure you know how to cover all the bases with prospective customers by being thorough. Pay close attention to all the details like the time and place of pickup and delivery, method of transport, etc…
Tips for Freight Broker Agent on Handling Tasks
- Once the company hires you for assistance, you can then talk about your commission fee. You can check loading boards online each morning.
- Find a trustworthy trucking company that offers suitable services for the goods. You can also have agreements with various trucking companies to be your partner.
- You can send a contract to the trucking company containing all the information. They will need to sign off and send it back once they agree to take the goods.
- You can then call the manufacturer or shipper to let them know the schedule of pickup and delivery. Just make sure there will be no delays in the shipment by staying in touch with the driver to ensure everything is progressing well.
- Inform the manufacturer or shipper immediately when the goods have been delivered. You can pay the trucking company for the delivery service and then send an invoice to the manufacturer or shipper for your fees.
You can be more occupied if you have your own freight brokerage company than working as a freight broker agent. You must have excellent funds or a good credit score to get loans that you may need to run the company. You have to pay the trucking service promptly. Insurance, bonds, and licenses are also your responsibility.
Are Freight Brokers in Demand?
As we all know, the freight industry and the shipping industry have done nothing but increase the amount of business that it sees. Online shopping is much more commonplace, and there is an ever-growing need to get goods to the customers that plan on (or already have) purchasing them. Freight brokers are there to bridge the gap between the shippers and the drivers. Let’s look at some quick facts pertaining to freight brokers in the world of employment:
- The Bureau of Labor and Statistics predicts that the need for freight brokers will increase by 9% a year for the next few years.
- The unemployment rate for freight brokers has gone from 7% in 2010 to 3% in 2019.
- The tenure of the profession is rather short, with the highest percentage (37%) of freight agents staying in the profession for only 1-2 years.
- The most popular cities for a freight brokerage business is either Kansas City, MO, or Chicago, IL.
Of course, freight transportation is the most popular industry that you will find a freight broker company in, but other popular industries for freight brokers include air and sea transportation.
How Difficult is It to Become a Freight Broker
In order to open your own freight broker business, there are several things that should be under your belt in order to help you succeed. This is a fairly easy field to get into, which explains why it is such a popular career choice for so many people. Let’s look at a few of the requirements, and a few extras, that will help you become successful in your new career:
- High School Diploma. Technically, this is all the education that is required to become a truck broker, but it is recommended that you go beyond this level.
- Freight Broker Training School. Also known as freight broker school, this is a kind of quick freight broker training program that will teach you the ins and the outs of the logistics industry and the freight broker industry.
- Industry Experience. As is usually the case, having some hands-on experience will help you land a job in the future. This experience will also give you valuable knowledge about the shipping process.
- Freight Broker License. Independent freight agents must apply for their broker authority with the FMCSA.
- Final Steps. After freight brokers have gained their license, there are additional licensing requirements that must be met. There are different insurance requirements for different areas, as well as an application fee that must be paid.
Why Do Freight Brokers Fail
As we mentioned above, there is a high turnover rate for freight brokers, with an average tenure of two years at the most. There are many reasons why a person may fail in their freight brokerage business. Let’s look at just a few of the most common reasons why there is such a high turnover rate for this profession:
- Lack of Marketing Strategy. Some freight brokers simply do not get enough publicity to gain enough business to make a profit.
- Lack of a Solid Business Plan. If you are not willing to put the time in to come up with a good business plan, this industry will eat you alive.
- Mismanagement of Business Finances. Simply put, if you misspend the money that you have coming in from your freight broker agency, it is sure to fail and leave you in the dust.