With a booming consumer-driven economy and an eCommerce landscape that's growing at lightning speed with no signs of slowing anytime soon, there's enormous demand for all things transport in 2019. Businesses need to be able to ship their goods quickly, affordably and reliably, but holes in the supply chain, including a widening trucker shortage, signify that the marketplace just can't keep up. If you're interested in reliable, high-demand work and decent pay, you'll definitely want to consider entering the trucking industry. But what jobs should you consider within the field?
Today, we're covering the position of freight broker, a professional who helps make shipping and transport easier and more efficient for all parties involved. This career path is one showing a promising outlook, with data showing a projected job growth of 7 percent through the year 2024 for freight brokers.
What Is a Freight Broker?
In short, a freight broker or a freight agent is the middle-man between a trucker (a carrier) and a person in need of some kind of shipping service (a shipper). Brokers connect carriers and shippers and help broker deals between them. Responsibilities of freight brokers include:
- Finding transportation solutions for shippers
- Helping shippers find the best rates
- Helping optimize a carrier's load so trucks are full
- Helping to find the quickest shipping options
- Negotiating the pricing between shippers and carriers
- Calculating freight rates and trucking loads
- Tracking shipments and ensuring legal compliance
- Helping shippers find the most reliable carriers
Freight brokers must have strong interpersonal skills and be comfortable negotiating. A basic understanding of the shipping industry helps, too. Note that freight brokers typically operate their own business, so an entrepreneurial spirit and an understanding of some business basics is essential for success.
Freight Broker Salary and Hours
Freight brokers typically do not make a salary, but are instead paid a commission depending on the deals they broker. According to the U.S. Bureau of Labor Statistics, the mean annual wage for freight brokers was $44,980, but brokers earn anywhere from around $25,600 to $65,600-plus based on data collected in May 2017. Because you own your own business, you will not be required to work any specific hours or days.
Steps to Becoming a Freight Broker
Despite the relatively high pay, freight brokers do not need to have any formal education beyond a high school diploma or equivalent. With that said, there are some steps you need to take before you can properly practice as a freight broker.
- Learn the Field - Of course, you won't be successful as a freight agent if you don't know a thing or two about the industry. There are many highly rated freight broker training programs out there and, though they are not required, they can help you prepare yourself so that you're brokering the best possible deals for your clients. Other freight brokers opt to learn the ropes themselves through free online materials and training books or through apprenticeships.
- Create Your Business - As mentioned, freight brokers are also usually business owners. Choose a name for your business, register it with your area's local business department (either as a corporation, a sole proprietor, a limited liability company or a partnership) and obtain a tax ID number. Once your business is legitimate, talk to others in the field and develop a business plan.
- Obtain Bond and Insurance - This is one of the most important parts about becoming a freight broker. You cannot get your license unless you obtain a freight broker bond or what's known as a BMC-84. The Federal Motor Carrier Safety Administration (FMCSA) requires freight brokers to have a surety bond of $75,000. Next, be sure that you are covered by contingent cargo insurance and general liability insurance.
- Obtain Your License - To start your freight brokerage, you'll need to apply for a USDOT number and broker authority. Apply for the Motor Carrier Operating Authority (called the OP-1 form) and then you will receive what's known as a motor carrier (or MC) license.
- Start Earning Money - Once your business is ready to go, you can start working! Select your agents for service of process using the FMCSA form BOC-3 and begin marketing your business. Spend the early days getting the word out so that carriers and shippers know you're in business. At this point, you're ready to start brokering great deals and racking up the commission.
Let Surety Bonds Direct Help
Surety Bonds Direct is here to help you easily navigate the surety bond process so your freight brokerage career is totally legal and legitimate. We welcome new freight broker partnerships and our knowledgeable bond specialists are more than happy to help assist you with obtaining your BMC-84 bond.