You’re busy.
You can't waste time finding the best rates for your freight. You simply don’t have it as a business owner who’s busy operating and growing your organization.
Enter — a freight broker.
They are your personal shipping concierge, bringing you the best rates with the best carriers for your freight, something that can take your business to the next level.
You can save time and money by offloading the critical task of managing logistics to someone else.
In this post we’re going to break down everything you need to know about working with a freight broker, how to choose one, and why they can help your business out.
The most straightforward answer to the question, “what is a freight broker?” is that they are an intermediary in the shipping and logistics industry.
A freight broker helps shippers connect with the right carrier for their freight and transportation providers to find freight for their fleet.
You can think of a freight broker as the go-between for shippers and transportation providers. That means they don't own any equipment, facilities, or freight but instead do the legwork to get the shippers’ cargo onto a transportation and to its eventual destination.
Freight brokerages can be as small as a single person running the business from their home or as large as a national operation with hundreds of employees and customers.
No matter their size, freight brokers like Moto operate in the same way. You can expect they will handle everything from finding the suitable carrier to seeing your shipment through to its destination. That equates to substantial time savings for you and a more smooth experience overall.
They work alongside other transportation and logistics professionals to get your freight where it needs to go. It is important to familiarize yourself with these terms so you know you and your freight broker are on the same page. After all, the last thing you want is to be asking yourself, “wait, what is a freight broker agent again?”
To avoid confusion, we summarized the key players when it comes to freight brokerages and beyond in the table below.
|
Role |
What They Do |
|
Shipper |
An individual or business seeking to ship goods. |
|
Carrier |
A business that provides transportation of freight to shippers by various modes of transit. |
|
Freight Broker Agent |
An individual who works under or for a freight broker to help customers find carriers for their shipment. |
|
Freight Forwarder |
Businesses who arrange transportation for your freight, taking physical possession of the goods and offering further services such as consolidation in addition to transportation planning. |
|
Customs Broker |
Individuals or businesses focused on the facilitation of cross-border goods transportation and customs clearance. |
When it comes to understanding what a freight broker does, you can think of it kind of like buying and selling a home.
When you have a home to sell, you go to a real estate agent to help you find a buyer for your home. The realtor doesn’t own your home, but you do pay them for their services. The buyer of your home may not own a home themselves, but they are looking for a place to live. Your real estate agent will facilitate the sale by providing services like marketing and documentation.
Freight broker companies do almost the same thing.
They offer businesses the opportunity to leave complicated shipping and logistics planning to the professionals and create greater efficiencies for your organization.
The diagram below shows how freight broker companies work.
As you can see in the diagram above, working with a freight broker means becoming part of an ecosystem. You enter into key working relationships with others who have their own duties and responsibilities in that ecosystem. Even you, as the shipper, have responsibilities like reviewing contracts and completing documentation as required.
Like a true ecosystem, each person in the network affects one another. Mutual success is obtained by ensuring each part of the ecosystem functions well and fulfills its duties as needed. That’s yet another reason to choose a reputable freight broker who operates transparently and effectively like Moto. By selecting a freight broker you can trust, you know this “ecosystem” remains healthy and stable.
When organizations broker freight, they have core responsibilities to both their carriers and shippers.
And like we mentioned, the relationship between freight brokers, carriers, shippers, and customers is a fragile ecosystem that requires everyone to do their part to make it a mutually successful venture.
Freight brokers are at the heart of mutual success in this case, and they have key responsibilities to uphold.
Those responsibilities include:
While the above list is not exhaustive, it covers off a lot of the basic responsibilities of a freight broker. It’s important to know what these key duties are so you’ll know what to expect from a freight broker, and how to spot the ones going above and beyond.
In a growing business, there is often a lot of work you take on personally, going the “DIY” approach to save money and scale successfully.
But what happens when your business grows so much that you can’t man every station in your organization, and you’ve outgrown the DIY-ability of it all?
You can run into problems like:
And what do all of those problems mean in the grand scheme of things?
Unhappy customers, a loss of business, frustrated employees — you get the idea. Bad logistics mean bad outcomes for you.
One solution to this headache is hiring an external team to manage your logistics, as a freight broker. There are plenty of headache-solving side effects when you choose to work with one, so let’s get into those next.
Having someone else take care of the ins and outs of your transportation coordination is one way to save you time.
Freight brokers offer you the opportunity to offload:
With those things off of your plate, you won’t be wasting your precious time.
Searching for the best price for your freight can be difficult, especially as a newbie to shipping.
You don’t have connections or relationships with freight carriers yet, so it can be hard to negotiate the best deal. Plus, you may even run into carriers who don’t have easy to understand or accessible information about their accessorial pricing so you make mistakes and don’t get the quote set up properly. Then you end up with a bill at the end of it all you were never expecting.
By choosing to work with a freight broker, you get to absorb all of their relationships and connections. Many freight brokers also have the ability to provide you with volume discounts and lower shipping costs. That is something that takes time and effort on your own, and relying on a freight broker skips the painful process and gets you right to saving money by matching your freight to the right carrier and nailing the quote down, the first time.
Remember when we talked about the challenges of being a shipping newbie just now? Not only can it be difficult to build relationships and create a roster of carriers for your various needs, but it’s also hard to find reliable ones, too.
By using a freight broker, you can ensure you are working with reputable carriers and avoid sketchy interactions with carriers who don’t have your best interests in mind.
Freight brokers’ expertise is focused solely on transportation. That means they know which carriers can provide the best service for your needs, and they can assure you with both their own and other clients’ experiences your freight will get to where it needs to go — damage-free and on time.
Imagine you’re in need of surgery. If you had the option to choose between an expert surgeon with ten years of experience or a medical student with one, you’re probably going to choose the surgeon with ten years of experience, right?
The same goes for booking transportation.
When you have freight that needs to get to its destination, you want to find the option that is:
When you’re not an expert in booking transportation, you can struggle to make all of those things happen, especially at once.
A freight broker is adept at finding transportation options that meet your needs and even finding the most efficient way to get freight to its destination if you need multimodal transportation.
Every business needs to forge solid relationships in order to succeed.
That is especially true for freight brokers and shippers. When shippers are able to save money and time, and customers receive their freight on time and damage-free, success follows. Freight brokers aim to see you succeed because your success likely means long-term success for their business too. They can grow carrier rosters, increase staffing, and even improve volume discounts for their customers.
So not only does working with a freight broker help you build your business’ success, but ensures you work with a team that has your best interests in mind now and in the future.
You think you’ve found the one. Your one, true…freight broker.
But how do you know they’re right for your business, exactly?
Well, it starts with understanding what you need to keep in mind when choosing a freight broker agent:
As the old cliche goes, size matters.
And when it comes to choosing a freight broker, that logic definitely applies.
Service levels, pricing, speed, and the number of additional services offered will depend on the size of the company. Generally speaking, that means that the bigger the company, the more services they can offer you. It also means that larger brokers are going to give you the most variety and geographic coverage as they would likely have a larger quantity of relationships with carriers than a smaller firm.
But that’s not saying you need to hire the biggest company on the block just because they happen to be the biggest.
You need to find a freight broker who meets your needs. For example, if you need a lot of personalized services and attentive communication, and have low freight volumes, a small operation could be fine for you. However, if you have daily, high-volume shipments and need a freight broker who can manage problems as they arise, as well as offer you extra services like warehousing and freight forwarding, an adaptable and scalable company like Moto is a great option. We offer you 98% on-time service and a 0.01% damage rating.
In business, reputation is everything.
Your customers leave you reviews, and business partners like to know how they can expect you to behave if you entered into a relationship with you. Both are important to the success of your business overall.
When you want to select the right freight broker to work with, you should take the time to interview a few options, seek our references, and make sure you are comfortable with their policies before entering into any kinds of agreement.
This can set you up for success later on by avoiding sketchy operations that have big claims but nothing to back that up. Even checking online for reviews from your provider can avoid loss of time, money, and even freight.
You’re busy growing your business. And hopefully, that means an increased need to send more freight.
The thing is, you need to find a freight broker that can scale along with you. They need to be able to handle increasing volumes of freight but also manage the ebb and flow of your freight demands with the right connections to the right carriers.
And considering approximately 97% of trucking companies in the US have a fleet of less than 20, and 90% have a fleet of less than 6, you’ll need to make sure the freight broker you choose offers you access to a variety of sizes and types of carriers to meet your needs.
You’ll need to consider your business’ seasonality needs as well. Not all carriers have the same capacity year-round, and may not be able to keep up with seasonal demands. That can also be a problem, so make sure you have an in-depth understanding of which, and how many, carriers your freight broker works with and ensure they are qualified to meet your needs as a potentially growing business.
When you ship freight, you need to know it is going to get there. Specifically, you need it to get there on time, and be damage-free.
After all, your business’ reputation and your responsibility to your customer is on the line when you make a mistake in shipping. Delays in delivery, or broken goods — it doesn’t matter what the problem is, it just matters that there is a customer problem in the first place.
You also want someone to take responsibility for that care. Your freight broker should not only be responsible for the delivery, but for any problems that arise during that delivery, too. And in an unpredictable world like the one we live in, you need a freight broker to handle the problems with ease, and without giving you the stress along the way. You want to know they can keep you in the loop about tracking, and take responsibility for delays or damage.
Have you ever gotten an estimate back, been happy with the amount, proceeded with the services, and been hit with a way bigger bill than you anticipated?
It’s not exactly going to https://www.shipmoto.com/services make you want to pick up the phone and use those services again. Instead, you’d likely be frustrated, annoyed, and potentially underwater on a deal. Think of how one estimate for a piece of your COGS, or cost of goods sold, like shipping could impact your profit. You could end up spending more on shipping costs than you’d ever hoped to profit from on an order.
When you work with a freight broker, you need to know they will offer you transparent pricing and an estimate that is accurate to the services you need. Always take time to ask if there are any extra fees and pricing guidelines you should be aware of before getting started.
Often confused for one another, there are key differences to understanding the difference between freight forwarder vs broker. While both are helpful 3PL providers a freight broker will never physically take possession of the freight, or do any of the actual moving of goods like a freight forwarder, but rather be the one to arrange the transportation itself. They connect carriers and shippers, acting as a coordinator.
You probably will rely on a truck freight broker if you need to send freight by land, in a shorter distance than say, air transportation. Truck transportation is one of the most common ways freight travels around North America, with $295 billion in truck trade happening between the US and Canada. Moto can offer you a wide variety of trucking services, allowing you to get your freight from one place to another with ease.
If you’re wondering what the difference is between a freight broker vs dispatcher, you’re not alone. While both are similar and integral to freight brokering, there are key differences. Freight brokers operate as a middle person between shippers and carriers, whereas dispatchers represent only one carrier at a time, not interfacing with shippers at all.
If you are shipping goods into another country, you would likely be working with an international freight broker. International freight brokers are agents or businesses focused on facilitating the international transportation of freight on behalf of businesses both domestically and otherwise.
They would perform similar duties to any other freight broker. However, particularly important is the preparation of documents such as customs documentation as the freight moves through one or more countries to its destination.
Now that you know what to look for in a freight broker, and how you can benefit from working with one, it’s time to make the moves you need to get started with the right freight broker.
Moto provides flexible, scalable, and cost-effective freight shipping services throughout Canada and the United States. You can trust your freight will get to where it needs to go, safely, and on time.
If you have questions about how Moto can help your business, you can get in contact with us, or check out our FAQs for more information.