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introduction to freight brokering

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What’s the Difference Between a
Freight Broker and a Broker Agent?

This is a common question ….. here’s how we answer it:

  • A freight broker is fully self-employed and is required to obtain his or her broker authority. A fully self-employed freight broker will do his or her own invoicing to customers and will pay the motor carriers. Essentially, the freight broker is running the entire business.

  • A broker agent works for another freight broker and does not need to obtain a broker authority. The agent works under the authority of his or her freight broker and is not responsible for invoicing or paying the trucks. The agent then splits his or her commission with the freight broker.

Many freight brokers do not want to work with inexperienced agents. They want someone who will hit the road running. They don’t want to train you. They want you to at least have the proper training if you don’t have any experience.

Each freight broker is different in what they expect. Some will pay for your load board expense. Some won’t. If you have to pay for the load boards yourself, you are looking at about $99 per month or (much) more.

Some brokers may want you to pay for using their software. In my opinion, I would be careful here especially if it is pricey.

Some brokers have lengthy contracts. Some don’t use any contracts.

There are other pros and cons to each option.

First, a fully self-employed freight broker is required to get their broker authority but they retain 100% of the profit on each load. Further, the freight broker is totally responsible for invoicing the customer and making collections as well as paying the motor carriers. Cash management skills are an absolute necessity.

Since time and effort are required to run an entire business, the freight broker has somewhat less time to search for new customers and find trucks as compared to a broker agent.

Second, a broker agent is not required to get his or her broker authority and, therefore, this option is less costly. But the broker agent splits his or her commission on each load with their freight broker.

Most of the agent’s time is spent searching for new customers and finding trucks. They generally have more time compared to the freight broker because the agent is usually not responsible for the “backroom” office work.

Lastly, if you are starting your own brokerage and are serious about hiring agents, OR if you are seeking to become an agent, you need this helpful resource:

The Definitive Guide to
Growing Your Freight Broker Business
Using Broker Agents

What I’m saying is that this eBook is helpful for agents as well as freight brokers. There is no resource like this anywhere.

If you have any questions, please call us at 888-526-ATEX (2839), Or

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