Is being a freight broker difficult?
While the job can be challenging, it offers numerous benefits, including higher earnings potential and the ability to work from anywhere. In this article, we'll explore what it takes to become a successful freight broker and why it might be the right career choice for you.
In conclusion, freight brokering is a job that can be both hard and lucrative. To do well as a freight broker, you should put a high priority on building strong relationships with your clients. You should also answer questions quickly, know your costs inside and out, and keep learning more about the business.
Yes, being a freight broker is stressful.
This, combined with the significant amount of work it takes to organize and manage shipments, often results in freight brokerage being a stressful job. However, many people find this stress worth it for the money they earn and the freedom of being their own boss.
On average, the yearly freight broker salary in the U.S. is $71,500 ($36.67 per hour). Entry-level positions begin at $45,000 per year, while most experienced professionals earn up to $107,500 per year. As a freight broker, you can start your own trucking business and become your own boss.
You Don't Have Complete Control Over the Shipment
One of the biggest downsides to using a freight broker is not having total control over the shipment. Once the load is given over to the broker, the shipper's ability to manage that load may be hindered.
As more businesses emphasize supply chain efficiency to maintain smooth operations, demand for freight brokerage services is expected to remain strong.
Freight brokers make their money in the margin between the amount they charge each shipper (their customer) and what they pay the carrier (the truck driver) for every shipment. Although it varies from one transaction to the next, healthy freight brokers typically claim a net margin of 3-8 percent on each load.
The average age of freight brokers is 40+ years years old, representing 54% of the freight broker population.
Further, the W2 model of freight brokering shows an even more dramatic statistic. Nearly 95% of newly hired brokers turnover within the first 6 months.
Yes, freight brokers can indeed make 7 figures – many have successfully grown 6, 7 and even 8 figure businesses.
How do brokers find loads?
- Load Boards. This is one of the most common ways brokerages find loads. ...
- Referrals. ...
- Actively Seeking Out New Shippers. ...
- Cold Calls. ...
- Warm Calls. ...
- Online Tactics. ...
- Targeted Marketing Campaigns. ...
- Partner with BlueGrace.
Freight agents have less liability in comparison to a freight broker. Freight agents need freight brokers to operate, whereas freight brokers can operate without freight agents. A freight broker will have a more consistent brand look and feel across its office(s) versus freight agents that operate under the broker.
Develop relationships with trusted carriers
Consider using an onboarding platform for carriers and utilize tools like Carrier 411 for vetting and monitoring of carriers. Trucker Tools has developed a trusted network for carriers, allowing the broker to rebook carriers in their network.
Compared to trucking carriers, freight brokerages can avoid shutdowns even during nasty freight recessions. But, since new capacity flooded the trucking industry and consumers stopped buying as much stuff, third-party logistics companies have seen an unusual threat to their business operations.
While freight brokers generally are not liable for cargo claims (i.e. loss or damage to cargo), there are several ways brokers can become liable for cargo claims. The primary ways a broker can become liable for cargo damage are: The broker agrees to be liable for cargo damage via contract with its customer.
To be a successful freight broker, you can't stress about the things you can't control. When an issue arises, act quickly, solve what you can and communicate your solution with all impacted parties.
Dry vans pay the least, flatbed loads pay higher, and refrigerated cargo pays the most. Each type of load required different driver skills and equipment. Developing the skills and capabilities to haul higher-paying loads is a long-term strategy to build a more profitable trucking company.
Flat-bed loads are good-paying loads because they're usually heavier or larger cargo, and the driver often has to help secure and cover the load. Dangerous goods, such as fuel, chemicals, or other unstable cargo, are better-paying as well.
Hazmat Hauling
The Hazmat industry has some of the best paying trucking companies. This is because Hazmat hauling involves transporting hazardous materials such as chemicals, fuel and explosives.
The fact is, the freight brokerage business is very fragmented with thousands of brokers and the majority of freight brokerage firms does less than $5 million per year in sales. It's important to note that while gross revenue is great, the key lies in running a profitable and sustainable business.
What's it like to be a freight broker?
Freight brokers typically work in dynamic and fast-paced environments, typically in an office setting. Some freight brokers run their own businesses and work for themselves, while others work for established brokerage firms.
The most successful freight brokers utilize a variety of methods to land new contracts, such as using USDA business listings, using shippers lists and calling leads, and even studying their purchase history and calling former customers.
The average freight broker salary in the USA is $72,500 per year or $34.86 per hour.
Freight brokering can be a highly profitable business. Brokers typically earn a commission on every shipment they arrange, which can range from 10% to 30% of the total shipping cost. With high shipping volumes, the profit margins can be substantial.
There are 82,188 Freight Forwarding Brokerages & Agencies businesses in the US as of 2023, an increase of 0.2% from 2022.
