What is the difference between a freight agent and a freight broker? (2024)

What is the difference between a freight agent and a freight broker?

Freight agents and brokers are often conflated or confused. The major difference is licensure and liability. A freight broker is licensed through the Federal Motor Carrier Safety Administration (FMCSA) and is legally responsible for the cargo. A freight agent is not licensed or liable.

Which is better, a freight broker or freight agent?

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.

What is the difference between a broker and an agent in shipping?

Unlike a freight broker, a freight agent does not have their own operating authority and legally can't arrange the movement of freight on their own. Therefore, they can only do business by working with a freight broker.

What is the meaning of freight agent?

noun. : a carrier employee who receives, forwards, or delivers goods or who represents or directs locally the freight functions of a carrier.

Is becoming a freight agent worth it?

Many Profit Generating Opportunities. Motivated, confident, and skilled freight agents have unlimited opportunities for generating and increasing profits. There is no limit to the amount of money you can earn when working as a freight agent.

How do freight agents make money?

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.

What are the disadvantages of using a freight broker?

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. Freight brokers must make money somehow. They do that by charging more for a load than they're paying the carrier.

Why do shippers use freight brokers agents?

Transport Industry Expertise

One of the main jobs of a freight brokerage is to monitor the transportation market. As a whole, this market is often subject to price volatility, making it difficult for an outsider to know what the “best price” is for a shipment. This is where a freight brokerage can help.

Can a freight broker also be a carrier?

While it is uncommon, yes, a trucking company can broker loads if it possesses both FMSCA motor carrier and property brokerage authority. Trucking companies that possess both authorities are a one-stop shop for customers.

What is another name for a freight broker?

Broker (Freight): Also known as a Freight Forwarder or Third-Party Logistics company (3PLs), that operates as a middleman between the customer and the carrier to negotiate freight rates, services and manage any complications throughout the shipment lifecycle.

How much do freight agents make in the US?

The average Freight Agent salary in the United States is $41,627 as of March 26, 2024, but the salary range typically falls between $36,962 and $47,833.

How do freight agents get customers?

Freight Brokers use prospecting to expand the size of their sales funnel. They'll reach out to leads (potential shipper contacts) and nurture them into “opportunities” (leads who have been warmed up over time).

How do freight agents work?

The Freight Agent is responsible for managing the timely and cost-effective transportation of goods from one location to another. This role coordinates with carriers to ensure that shipments are delivered safely and in accordance with customer requirements.

How to get started as a freight agent?

Which is better freight broker agent or dispatcher?

If you are a shipper looking for the best rates and services, a freight broker may be the best option for you. If you are a carrier looking to manage your transportation operations more efficiently, a freight dispatcher may be the best option for you.

Are freight brokers in high demand?

High Demand and Growth

According to the U.S. Bureau of Labor Statistics (BLS), industries that hired the most cargo brokers include: Freight transportation arrangement (52,450 jobs) Couriers and express delivery services (7,570 jobs)

How do I market myself as a freight agent?

What is the commission split for freight broker agents?

Freight Agent Commission Split

According to Freight Tec, companies within the industry offer commission splits that range from 25 – 70% being paid to the agent. The amount of commission varies depending the third-party logistics company/freight broker you work for and how they structure their agent's compensation.

Can freight brokers make 7 figures?

Yes, freight brokers can indeed make 7 figures – many have successfully grown 6, 7 and even 8 figure businesses.

Is freight agent a stressful job?

High. Stress is not uncommon amongst cargo and freight agents, with daily work sometimes being quite demanding.

What percentage do freight brokers keep?

According to a Freight Waves survey, the average commission is 13% to 15% of a load's net revenue. Example: A shipper pays $4,000 to a licensed freight broker to move a load. The freight broker negotiates $3,000 with the trucking company to transport the load, leaving $1,000 net revenue.

Do freight brokers get sued?

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.

Is Double brokering freight illegal?

Double brokering is the illegal act of a broker or carrier transferring a load to another trucking company without notifying the shipper. In a legitimate shipper-broker agreement, the broker assigns loads to carriers, and those carriers pick up and deliver the loads according to the terms of a broker-carrier agreement.

How do freight brokers find loads?

How do freight brokers get carriers?

Load Boards – Posting and Searching Carriers

Posting loads and searching trucks are the two most common ways of finding carriers and covering loads. And even though both are done in the same marketplace, they are very different approaches and offer advantages and disadvantages.