Did you know that millions of packages are shipped around the United States on a daily basis? This is one of the reasons that freight brokers have become so essential in the U.S. transportation industry today. If you are thinking of becoming a successful freight broker, you are in the right place.
Our guide below will share our top tips on how to run a successful freight brokerage. Read on to learn more.
One of the best ways to be successful at anything is through experience, because practice makes perfect. Having on the job training is one of the best ways to gain experience in the field. You can choose to work as a truck driver or work with a trucking company.
On the job training will help you understand what it truly takes to be a freight broker.
2. Business Strategy
Creating a solid business strategy or plan will set the intention of where you want your business to go. Make sure to take into account the current market while calculating your projections.
This plan needs to include your startup costs, the steps to get the business off the ground, revenue projections, goals, and your annual milestones. During this step you can also decide if you need extra tools such as LoadPilot Freight Broker Software to get started.
3. Business Costs
Once you have your business strategy in place you need to figure out the expenses you will have. Common expenses include a computer, systems to facilitate loads, and dedicated phones.
Plus you might also have to pay for certain licenses in your area in order to operate legally.
Every freight broker needs to have a valid license in the United States in order to comply with federal laws. There is a one time fee charged by the FMCSA (Federal Motor Carrier Safety Administration) that has to be taken care of before you work with any customers.
You will also have to secure either a trust or a bond as part of your business requirements. If you fail to do this, in the future you might not be able to get a bond or a license, causing you to have to shut down your brokerage.
5. Knowledge With Bonds and Trusts
In order to become a freight broker you will need to have a bond or a trust with a minimum of $75,000. The reason is that this will protect your customers in case the transactions for the event do not follow federal guidelines. In the event of any claims against the brokerage, the bond or trust will pay for these claims.
The most common choice is a bond because the cost for this is a percentage of the total bond requirement. A bond costs a broker a lot less money than a trust. With a trust, the broker doesn’t have a choice but to pay $75,000 up-front into a trust.
Decide which option you prefer and would work best for your company.
Without business relationships, a freight broker can’t be successful. You want to reach out to previous employers, co-workers and jobs to connect with those in the industry.
You can also network with other industry professionals through social media sites such as LinkedIn or networking events in person. These relationships will help you establish your position as a trustworthy partner for people to choose to work with your company time and time again. Plus, also send you referrals in the future.
7. Continuing Education
In this industry you are never done learning. You want to go into this business with an open mind that you will have to continue your education in order to stay relevant and continue to grow in the future as times and technology change.
There are multiple training school options around the country, or online options if that is easier for your schedule. When you never stop upgrading your knowledge you will not have an issue adapting and embracing new innovations as they come out.
The transportation industry is rapidly evolving as far as technology goes. From GPS cargo tracking to fuel efficiency tech, you want to make sure you keep up with the times. Using helpful technology for your business will allow you to be more successful and more efficient.
There are also logistic mobile apps where you can log deliveries easily, there are apps for lead generation, cargo optimization, and many other brokering activities.
Competition is high in the freight broker world and every year there are more licensed brokers coming into the field. This is why marketing is imperative in order to stand out.
You need to plan out things such as print ads, radio ads, social media campaigns, e-mail campaigns, etc. Don’t underestimate the power of paid ads on Google or on social media channels.
You can also attend local events or use online forums to market your business.
Now You Know How to Run a Successful Freight Brokerage
Now that we have shared how to run a successful freight brokerage, you can make informed decisions moving forward and ensure that you get started off on the right foot with your own brokerage. Keep in mind that a broker has the luxury of choosing to work as much or as little as they want, but the most successful brokers are the ones fully committed to work a full work week.
If our article helped you out, please continue browsing this section for more business tips.