freight broker

By Eric Weisbrot

Shipping is an integral component of the economy, and it would be more of a challenge without the help of licensed freight brokers. Working with a reputable freight broker is a common choice as they connect carriers and manufacturers to ensure loads are delivered on time and in budget. Brokers also play a crucial role in ensuring their customers are operating within the regulatory framework of the industry. Although having a working relationship with a freight broker can be beneficial, there are certain practices that help make the partnership more profitable and efficient. Here are ten tips for working with brokers that are sure to create a beneficial relationship.

Recognizing a Broker’s Role

First and foremost, any individual or business that want to work with a licensed freight broker needs to recognize what duties the broker is responsible for with each transaction. Essentially, connections between shippers and carriers are coordinated by a broker, and the progress of a load is managed and communicated back to the customer through the broker’s business. These processes are essential to the success of moving freight for many businesses, but only when the broker is entrusted with getting the details squared away with each transaction.

Verify Licensing

Anyone who wishes to work with a freight broker also needs to verify that the broker has met all the necessary criteria to be a licensed broker. The licensing process requires brokers to register with the Federal Motor Carrier Safety Administration, FMCSA, and obtain motor carrier authority by completing a license application. These requirements ensure freight brokers operate within the regulations set forth by federal law, and helps shippers and carriers easily vet a broker they wish to work with over time.

Check that They Have a Bond or Trust

Part of the licensing requirements for a freight broker including securing a freight broker bond or trust. Should things not go as planned, or if a broker fails to operate their business according to the law, a broker’s customer can file a claim against a bond or trust. A freight broker bond of at least $75,000 must be in place to meet licensing requirements, or a trust account must be established in the same amount.

Ask for Experience or Training

Another best practice when working with a freight broker is verifying his or her experience in the industry. Freight brokers must complete some form of freight broker training in order to obtain and sustain a license, and it is helpful if they have some hands-on experience in transportation or logistics roles. The combination of formal training and real-world job history provides for some peace of mind that the broker understands the nuances of moving loads successfully.

Allow Brokers to Manage Legal Requirements

A significant aspect of a freight broker’s role is managing the legal requirements behind the scenes, but some customers have a difficult time allowing brokers to do their job in this area. Trusting that brokers will take care of the legal necessities for each load is essential to make the transaction smooth and efficient. This includes handling bonding requirements, reporting loads, and ensuring delivery.

Have a Communication Plan

Like any other business relationship, brokers and shippers and carriers need to have a strong communication plan. Working with a broker requires communication up front about what is needed, and the deadline for a load, as well as any other specifications for the job. Brokers are tasked with providing timely updates and progress reports for loads as they are transported. Having open lines of communication both ways is a necessary part of working with a freight broker.

Securing the Best Shipping Rates

A notable benefit of working with a freight broker is locking in the best possible rates for shipping. Brokers have the ability to get up to date and affordable rates because of their knowledge of the industry and relationships with other professionals in the transportation industry. Allowing a broker to work through possible rates with these partners is a necessary part of the partnership.

Managing Issues

There are times when things do not go as planned, and this can cause high levels of frustration and mistrust. However, brokers are trained to manage issues with each and every load, providing clear communication as to why a problem occurred and how it will be rectified. Shippers and carriers need to trust that a broker will handle these difficult tasks sufficiently, knowing that they are there to be proactive in managing loads.

Build the Relationship

All business relationships require some level of cultivation over time. Working with a freight broker is no different. Taking the time to get to know the broker, his or her business niche, and how loads are handled is a necessary part of building this connection. Strong business relationships with freight brokers help create trust and understanding – two characteristics which are crucial to success in any field.

Be Flexible

Finally, working with a freight broker requires flexibility. When things do not go as planned or changes in the industry arise, brokers are typically on the front lines handling these issues for their customers. However, shippers and carriers also need to be able to adapt to these changes as time goes on. Without flexibility built into the relationship, working with a freight broker may not lead to successful outcomes.

Eric Weisbrot is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry under several different roles within the company, he is also a contributing author to the surety bond blog.

Freight stock photo by Yevgeniy Melnik/Shutterstock