Freight Broker Agents FAQs

First off I am 3rd generation in the transportation industry. I have been a small fleet owner and also a freight broker. Let me try and give some sound advice to the new agents or people looking to become an agent. Ill try to break this into sections.
Almost everything at some point travels by truck, so with that being said there is a good amount of competition and also scams out there.

1. Without any transportation experience, I would recommend getting a desk job at a local trucking company. You will learn a ton of info from this that will not be taught in a class.

2. Want to skip #1 and pay for class? Then go for it. You will definitely learn things from a book but not as good as being in the action on a daily basis. Plus Id rather get paid to learn, than to pay to learn. Just my opinion there.

3. Gained some knowledge and ready to broker now? Where do you start? Well shop around forums and ads on the internet to get started. Maybe you have a friend in the industry that can point you to a reputable brokerage. This is a huge life decision and you need to do your homework here.
a. Brokerages are considered Asset or Non asset based, meaning they have their own equipment or only search for carriers with equipment. Some shippers require Asset based carriers/brokers to even be considered to move their freight.
b. Now to the MAIN part to consider. What is the brokerages MC# <motor carrier>? The government began issuing out mc#;s as a way to track carriers and brokerages. The lower the number = the more established the company is. Currently mc#'s are in the low 700,000. So a broker with a 200,### would be way more established. What does that mean to you? A couple things... cont...

c. Lower mc usually its easier to get carriers to haul freight for you as the company has shown it survived the ups and downs of the industry. Also there are organizations that reward companies for passing <3> years of fast pay and good practices in the industry. 2 big names are TIA and NASTC. They will have a surplus of brokers that abide by good standards.

d. Maybe you have spoken with someone or have a company in mind. I would recommend doing a credit check on them. Credit will show how they pay the carriers and will tell you how well off the brokerage is. 2 transportation credit companies are transcredit.com and also compunetcredit.com . It may cost you $15.00 to pull a report, but well worth it to see where you are bringing in potential shippers and trucks to. cont...

Next you will want to ask the brokerage what they will do for you.

They should have
Authority - mc#
Surety bond $10,000 at lowest now. Some have more as the gov may increase minimum to $100,000 soon
Contingent Cargo - may or may not have. Basically its a backup insurance if somehow carrier ins fails. Shippers may request this.
Transportation Software - allows you to enter loads, shippers and carriers
Load boards 3 most common are Internet Truckstop, Getloaded and Transcore DAT.
Software and load boards are not cheap, its why you may see brokerages require a minimum sales figure a week to even allow you to become an agent for them.
Commission split <opinion only here> Common split is around 60% agent 40% brokerage. May vary from company to company

How to find customers?? Chamber of commerce, yp.com yellow pages, Manufacturing news - books of manufacturers, friends, family or drive around. I look at whats in the grocery store or hardware store. Store sells it, it must be shipped to my area.

Please feel free to post comments or other questions

Sales profit from loads
Generally you are looking at doing a 10% minimum profit on a load. Meaning shipper pays you $1000, then you would like to sell it to a carrier for $900 or less. On a 60/40 split you would make $60.00 on that move from $100.00 profit. Average profits <depending on each load> are from 8% to 18%. A lot of variables go into those numbers.

Some loads take 5 minutes to cover others may take all day or not get covered in worst case scenario.

Bottom line is that its not easy to become an agent. You need to be HIGHLY motivated as you will need to make endless phone calls daily. Rome was not built in a day.

Experienced Broker in Menomonee Falls, Wisconsin said: Next you will want to ask the brokerage what they will do for you.

They should have
Authority - mc#
Surety bond $10,000 at lowest now. Some have more as the gov may increase minimum to $100,000 soon
Contingent Cargo - may or may not have. Basically its a backup insurance if somehow carrier ins fails. Shippers may request this.
Transportation Software - allows you to enter loads, shippers and carriers
Load boards 3 most common are Internet Truckstop, Getloaded and Transcore DAT.
Software and load boards are not cheap, its why you may see brokerages require a minimum sales figure a week to even allow you to become an agent for them.
Commission split <opinion only here> Common split is around 60% agent 40% brokerage. May vary from company to company

How to find customers?? Chamber of commerce, yp.com yellow pages, Manufacturing news - books of manufacturers, friends, family or drive around. I look at whats in the grocery store or hardware store. Store sells it, it must be shipped to my area.

Please feel free to post comments or other questions

Can a freight agent invoice the customer directly?

In most cases no. That is part of the "control" factor the agencies will provide and want to keep. Would be harder to keep track of as well, especially if they are a larger outfit.
Hope that helps

Experienced Broker in Menomonee Falls, Wisconsin said: In most cases no. That is part of the "control" factor the agencies will provide and want to keep. Would be harder to keep track of as well, especially if they are a larger outfit.
Hope that helps

Thank you for your reply! But I just want to make sure that I got it right. So the Department of Transportation will not have an issue with an agent invoicing a customer. I know that it's not commen practice for the agent to invoice the customer but I have yet to see an official document stating that it is not allowed. The idea is to have more control over the customers information and lower the risk of someone stilling an agent's customers.

Thats always tricky. I wouldn't go to a big brokerage personally. They ask for a credit check on your shippers to get approved. I fear they have all info and can just back call them as well. Another option for you would be to get your own authority and factor invoices. Might be able to get 3-5% factoring fee. But you do get 100% of profit as well. Some shippers may also pay quicker than others to keep you afloat.

Experienced Broker in Menomonee Falls, Wisconsin said: Thats always tricky. I wouldn't go to a big brokerage personally. They ask for a credit check on your shippers to get approved. I fear they have all info and can just back call them as well. Another option for you would be to get your own authority and factor invoices. Might be able to get 3-5% factoring fee. But you do get 100% of profit as well. Some shippers may also pay quicker than others to keep you afloat.

Well, thank you very much for your feedback it has been very helpful. I hope that other people take this communication and utilize it to better there strategy/ broffit margine to help them grow.

Anytime, if you have other questions let me know.

What is TIA and why broker has to be member?

TIA is an organization that helps brokers. On load boards it may also post if you are a TIA member. Some carriers may think that looks better. Basically to be accepted you have to practice best industry policies. They have great info on the website

Website of member benefits
www.tianet.org/AM/Template.cfm?Section=Member_Benefits&Template=/CM/HTMLDisplay.cfm&ContentID=5238
Or tianet.org for main page

Hope that helps

Scott Turbo: I have been on your web site and seen your training package, it all looks quite professional. I am looking to move back to the States soon and would like to take an opportunity to work from home, however once I get there I'll need to find a steady job to start with pretty much anywhere. Is working as a Freight Agent on a part time basis possible, are shippers/carriers known to work with part timers? For anyone else reading this: Are you aware of anyone working part time for extra income? Many thanks.

I would like to hear from Broker Agents who have been working from home in the last year or so. Especially people living in the south-east area as I'm looking to move into the Metro-Atlanta area. I don't expect it to be easy work etc. but would like to know if it's a viable option, can it work?

I've also been reading, buying books here and there, and gaining as much knowledge as possible for the past yr. I have all the money needed to obtain my MC#, UCR, BMC84/85 and processing agent. I recently bought a new laptop fro my broker software, I feel like im ready to go. factoring companies aren't neccessary. Can anyone ( Brokers) point me in the right direction to getting my first load. How did you get your first customer? It all boils down to that question..HOW DO I GET FREIGHT?. I have an uncle who has established his own authority to run 3 reefer units. I've been up under his wing for 2 yrs learning the ins and outs. I plan on going about finding frieght the old fashion way...phone calls, door knocking and meet and greet. Please give me some insight.

The old fashioned way is what everyone is doing. Make the phone calls, knock on local doors, and keep the lines of communication open. You can't just call once and hope for the best. You have to keep calling back and make your presence known.

SlammPro in United Kingdom said: I would like to hear from Broker Agents who have been working from home in the last year or so. Especially people living in the south-east area as I'm looking to move into the Metro-Atlanta area. I don't expect it to be easy work etc. but would like to know if it's a viable option, can it work?

I work from home. Live in the south and move freight from SE to NE. That is the beauty of this business. You don't have to actually "live" in the area where you are moving freight.

Experienced Broker in Menomonee Falls, Wisconsin said: Sales profit from loads
Generally you are looking at doing a 10% minimum profit on a load. Meaning shipper pays you $1000, then you would like to sell it to a carrier for $900 or less. On a 60/40 split you would make $60.00 on that move from $100.00 profit. Average profits <depending on each load> are from 8% to 18%. A lot of variables go into those numbers.

Some loads take 5 minutes to cover others may take all day or not get covered in worst case scenario.

Bottom line is that its not easy to become an agent. You need to be HIGHLY motivated as you will need to make endless phone calls daily. Rome was not built in a day.

AMEN!!! Do not take this position lightly if you need to feed your kids. It takes a lot of WORK. I love it, but am amazed at people that are living in the fantasy world of "working from home is easy".

Id like to add that Linkedin.com is a great site to add to your collection. There are great groups on there to join with others in our profession. Excellent questions and relevant information is given from some of the top players in the industry.

Also I wish all of us brokers the best!

DHC Freight was established in January 2002 and has successfully with
Our Service have:

- Removals, Door-To-Door Service
- Tax Exemption Formalities
- Inland Transportation
- Customs Clearance
- Import & Export

Right now we want to FREIGHT from oversea, so please comment us how to do? and recommence us which one good.

Thanks and Best regard,
Sokha PICH

Experienced Broker in Menomonee Falls, Wisconsin said: Surety bond $10,000 at lowest now. Some have more as the gov may increase minimum to $100,000 soon

The surety bond is $10,000 as a set amount. Brokers do not get any more or less. It is not insurance coverage for them and they do not get to decide the amount. It is insurance for the FMCSA that the broker pays for.

The BMC-84 surety bond is actually starting to get approved again WITHOUT any collateral. You can get a free quote online at: www.jwsuretybonds.com/protools.htm

Hello, I have no formal freight brokering experience, bit I have been a truckload and expedite driver for 7 years now. I have in the past few years learned how to find companies to partner carrier with and will be opening up my own expedite company this month. I hnow how to get loads for my cargo vans and straight trucks, but not how to get them directly from the customers. most of the partner cariers that I deal with just get loads from their customers and throw them up on emails, broker boards, and this one particular website that regular brokers do not know about "this is where I will have my competitive advantage.

Well my question is I have a shippers contact information that only uses and knows about a larger expedite carrier. I recently asked them if they even knew they could get cargo van freight moved for under 2.00 a mile; they said no. I am going to contact them and try and have them call me with the loads and i'll put them on one of my cargo van units or just broker it out to partner carriers on this website for 1.00 1.10 a mile and charge them 1.50. But how would I bill them? I know what a rate confirmation sheet is when I get a load from one of my partner carriers, but I have never seen or dealt with a rate confirmation from a shipper. Any help would be greatly appreciated!