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A freight Broker is an individual or a company that links a shipper or a transporter of goods with an authorized motor carrier that wants to provide the service.
A freight broker is a transportation intermediary. It is a company that is neither deals with shipping nor is it an asset-owning carrier but plays a role in the movement and transporting of cargo. As explained by Robert A. Volkmann, executive director and CEO of the Transportation Intermediaries Association, “Transportation intermediaries leverage their knowledge, investment in technology and people resources to help both the shipper and carrier succeed.”
What Marine Insurance doesn’t include:
Freight Agent | Freight Broker |
Ø The biggest difference is that a freight agent is typically a person who acts as an independent contractor or salesperson for the freight broker. | Ø Freight brokers can range anywhere from a one-man operation to a large multinational company. | |
Ø Freight agents have their own customers and usually work on commission. | Ø Brokers are only responsible for hiring motor carriers that meet the FMCSA standards, including authority, insurance, safety standards, and that the payments due to motor carriers are not unreasonably withheld. | |
Ø A portion of the freight agent’s gross revenue goes to the freight broker in exchange for administrative sustenance, stream, insurance, liability buffers, and the reputation that the broker’s name offers. | ||
Ø A freight agent is responsible for the sales and to match carriers with customer needs. | Ø A freight broker assumes the risk of granting credit to customers so it’s critical for them to check and monitor a customer’s credit. | |
Ø Most agents work from their own homes, under the direction and authority of a licensed freight broker. This is the reason that they have little or no liability but are able to earn a significant income based upon the profit their customers generate. | ||
Ø Freight Brokers provide a significant and valuable service to both motor carriers and shippers. They help carriers fill the trucks and earn a commission and help the shippers find reliable motor carriers that the shipper might not have otherwise known about. | ||
Ø Agents interact with both the shipping customers and motor carriers in order to ensure their customers’ freight is picked and delivered on time, properly and without facing any issue. | ||
Ø A freight Agent performs numerous jobs. He solicits new customers, provides freight rates, sources carriers, negotiates with the shippers or the carriers, dispatches trucks, schedules pickups, and deliveries, and solves any problems that could potentially delay or damage a shipment. | ||
Ø Some companies use brokers as their traffic department, allowing the broker to coordinate all their shipping needs. |
When did Freight Brokerage begin?
Freight Brokers aren’t new to the trucking industry; they’ve been around since the start of the industry itself, in the early part of the 20th century. Prior to the 1970s, however, regulations governing brokers were so restrictive that they could hardly think of entering into the industry. The dramatic change of the federal transportation policy during the 1970s eased the regulatory restrictions, created new entrepreneurial opportunities in the third-party logistics arena.
Should you start your own Brokerage?
as an Israeli Freight Brokerage, we can say – Most brokers recommend working in the industry for a shipper, a carrier, or both before starting your own brokerage. This will not only allow you to gain technical expertise, but you’ll make contacts that are critical to success in this business.
Some Freight brokers may prefer using agents to develop a wider scope of operations. In this case, it should be kept in mind that agents are independent contractors who represent a freight broker in a given area. This would enable you to offer a local presence even when you do not have the volume to justify opening your own office.
How do I choose the right Freight Brokerage Firm for myself?
Everybody wants their business to grow exponentially. The doors to opportunity will open as soon as the international shipment of your product starts. But a daunting factor that prevents your business to be successful and international is the choice of the right broker or a brokerage firm.
You don’t have to worry about these things or enter into the industry and gain knowledge yourself. 7C logistics solutions LTD. is an Israeli Freight forwarding and Freight Brokerage company that provides you with all the brokerage services. They cooperate with you to show how forwarding freight is easy and can transform your business!
After all, it is all about moving your products and belongings from one point on the globe to another to internationalize your business.
