Freight Brokers: What You Need To Know

What is a freight broker and what do they do?

A freight broker is the one who assists shippers to look for carriers that haul their freight to the desired location. They broker deals between shippers and carriers and act as the middlemen between the two. They are also responsible for facilitating the movement of a shipment. They are a source of communication between the shipper and the carrier and help to coordinate the shipping operations. 

Freight brokers sometimes run their operations while other times they prefer working for freight broker companies. Their main role is to arrange reliable transportation and track the load while it is being transported. 

Shippers often don’t have the time or the expertise of finding the right carrier for their business. Mostly, trucking companies are consistent and deliver cargo and freight efficiently and timely but there are of course a few bad seeds that you would want to avoid. A freight broker basically helps you in making the right decision when it comes to partnering with a reliable carrier. 

A freight broker helps a carrier earn more as they plan and execute in a way that readily available loads are aligned for carriers making them work efficiently and hence earning more. They form a link between the shipper and the carrier. 

How Do Freight Brokers Make Money?

A freight broker arranges the lowest or cheapest carrier for his shipper, moving a customer’s freight for less than he is willing to pay. He makes a deal with the carrier at a higher rate and earns a profit called the ‘spread’. The client also pays him x amount and pays y amount for the carrier.

How much do they make in a year?

If you’re thinking of opening your freight brokerage, you might want to know what an average broker makes today.  They make an average of $41, 952 annually according to PayScale. This is a base salary and doesn’t include any bonuses or commissions so they do make more than this. 

The location where he operates also affects the salary of a freight broker. A freight broker earns more in a busy city like Dallas and less in a smaller city like Kansas. They can earn up to $75000 with commissions and bonuses depending upon the area where they operate.  

How do they find carriers for shippers?

When hired by shippers to move a load, freight brokers find reasonable carriers who’re available to haul their shipper’s load. There are broker load boards that they use to connect with carriers and this is one of the simplest ways in which they can network with carriers and build their own carrier base. 

Using a load board, they can quickly find available carriers who may be interested in shipping a load to a particular destination by reading the details on the board. These interested carriers then contact freight brokers and finalize a deal. 

They manage to perform the following tasks for a shipper:

  • Scheduling freights
  • Dispatch of the load
  • Loading in the carrier
  • Tracks shipment during transit
  • Unloading/Delivery tracking 
  • Manages the billing process

For a freight broker, time is money, and the more they can move in a given time, the more they earn.

Also Read: Freight Broker companies: The Pros and Cons

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