What Does A Freight Broker Do?
Interested in learning how to become a licensed freight broker? Well, you found the right place! Below is everything you know about getting started in a career as a freight broker – or freight agent.
We know that truck drivers often deliver goods within the United States, but how do those drivers know where to go and what to do? A truck driver might work for a trucking company that will assign them a route, but the trucking company will often work with a 3rd party to get those shipments on the road.
There are also international deliveries.
Air freight delivery services are another great career path, and those are the workers needed to help get products delivered and shipped between countries. Ships are another way when transporting across country lines.
That 3rd party used in all of the options above is called a freight broker.
Some of the responsibilities of a freight broker include:
- Providing potential customers quotes for shipping
- Contacting trucking companies and other carriers to develop schedules
- Procuring freight carriers that are reliable and trustworthy
- Negotiating with carriers on pricing to get their customers the best rates
- Completing all required paperwork required for deliveries
- Keeping customers informed of delivery status updates
- Collections when invoices are not paid
- Payment to freight carriers
Freight brokers will usually work for themselves and create their own businesses as we talk about in more detail below. There are some freight broker jobs out there as well, but those are usually pretty limited.
It is important to note that a freight broker does not do any deliveries themselves. They outsource the transportation needs to different motor carriers.
Becoming a freight broker is one of our suggested jobs for people with back problems.
What Does A Freight Agent Do?
This career guide focuses specifically on how to become a freight broker, but if you are looking for something with a bit less responsibility – then becoming a freight agent may be just the thing.
A freight agent will do a lot of what a freight broker does, but cannot work on their own and typically is not responsible for the financial or negotiating aspects of a broker’s job.
They will work as an independent contractor under a freight broker and are not required to get the same bonds and licensing as a broker. You can follow the steps below to become a freight agent, just omit the need for starting a business and getting bonus/insurance.
Related: Best jobs for introverts.
How To Become A Freight Broker
A great understanding of the freight industry is needed to be successful in this job, so some education will definitely be needed. Below are the steps on how to become a freight broker.
1 | Basic Requirements
- Must be at least 18 years of age
- High school diploma or GED
2 | Education
Although not required, attending a school that specializes in freight brokerage is highly recommended. Attending a school will help you better understand the freight industry, allow you to learn about tools the industry uses, and how to set yourself up in a freight broker business.
There are options to do freight broker training online, or you can use our tool below to find a school local to you that offers freight broker training.
3 | Choose and Register A Business Name (only for Broker)
Now that you have your training complete you can decide on a name for your business and register with the Internal Revenue Service (IRS).
We highly recommend you do a trademark search and check with a lawyer and accountant before starting your business. This will ensure you are on the right path! This is a great time to get that business plan going as well so you have a clear path to success.
4 | Apply For USDOT (Only For Broker)
A USDOT number is required for all freight brokers. Using an OP-Form you can apply and when approved you will receive a USDOT number that certifies you are an approved broker. Please note this process can take up to a month.
5 | Freight Broker Bond – BMC 84 (Only For Broker)
A required bond called the BMC-84 shows trucking companies that you are financially able to send payment in the event you do not follow contractual obligations. The bond requirement is $75,000 and acts as insurance. The amount you pay will be dependent on your credit score, and you can be denied a bond if your credit is poor.
6 | Find Trucking Partners (Only For Broker)
Before you even think of bringing on customers you will need to make sure you have amazing freight carriers to work with. Interview different carriers, do an analysis of them online, and try to get as many customer reviews as possible. After all, your success as a freight broker depends on them.
7 | Get Marketing
You are now ready to kick off your new career! With everything in place, you can now get your marketing plan going. Whether you choose cold calling, online marketing, or in-person events this is the time to get out there and make a company want to work with you. What makes you different? Why should a company change from its existing freight brokerage?
Freight Broker Course + School Options
The school search below will help you find freight broker courses near you.
Recommended Skills For Freight Brokers
Getting education and training is only part of the process! Below are some skills that will help you be successful as a freight broker.
Customer Service
Because you will be responsible for ensuring deliveries are made on behalf of clients, customer service skills will be critical. When delays happen or other issues arise, you will need the patience and ability to calm upset customers.
Detail Oriented
Creating quotes, planning schedules and arranging shipments is not easy task. With all these moving parts it is important that you have exceptional skills when it comes to looking at the little details.
Team Player
There are drivers, shipping companies, customers, and of course co-workers you might be dealing with. It takes a village to make shipments happen and you will need to work well with that village to keep customers happy.
Math
There is a lot of math happening in this job. From calculating miles to shipment sizes – you should be able to run different calculations to ensure quotes are accurate. Working in various spreadsheets will also help you be more successful.
Pros & Cons Of Being A Freight Broker
The pros and cons of being a freight broker may vary if you are working for yourself or for someone else. Below are a few of the most common pros and cons of this career depending on the path you choose.
PROS
- Income potential
- Working as an entrepreneur
- Work from anywhere
- Low investment to get started
- Sell your business in the future
CONS
- Self-employed brokers always have to look for new customers
- Stressful
- Overtime and weekends are sometimes required
- Can be lonely if you choose to work alone
How Much Do Freight Brokers Make?
According to the Bureau of Labor Statistics, the median annual pay for freight agents (who typically make a bit less than a broker) in 2020 was $47,170.
There was no specific data for freight brokers, but there are freight brokers earning 6-figure incomes and more. How much you can make is dependent on your motivation and sales aptitude.
Frequently Asked Questions
Below are some of the most commonly asked questions about this career. If you have other questions that are not listed here – please email us or leave a comment below and we will be sure to add it!
Sources:
ZipRecruiter