Company or Agent?

Discussion in 'Freight Broker Forum' started by Disgruntledriver, Nov 3, 2014.

  1. Disgruntledriver

    Disgruntledriver Light Load Member

    Hello all.

    So I have decided from researching and asking questions that I want to become a freight broker. I understand it is not easy, nor is anything in life worth having, but I really want to get out of a truck. The flexibility of working from home and actually making good money with experience I have gained over the last couple of years motivates me to do whatever it is I must to succeed at this. I have always paid close attention to the paperwork side of this trucking fiasco, I have asked questions at the shippers and warehouses as to how their processes are done. I always like being well informed in what's going on around me. I've even resolved issues many times to do with shipping manifests that my companies were unable to resolve in a quick manner. I don't believe I'm superman or super intelligent but I keep my eyes and ears open, I listen and learn and strive to do my best and go beyond. Before driving a truck I was in the banking industry and even managed a team of customer service reps. I know all about head hunting and cold calling and was very good at it. I did a lot of clerical work, paperwork, filing and things of that nature. I'm very good at all that and want to combine all the expertise I have in my life to finally live life the way I want.

    The biggest thing as I said that appeals to me about being a freight broker is being able to work from home. I like the idea of being able to go fix my own food in my own house, go for a jog if I so desire and feeling like I'm not shackled to a truck. I've done projects from home before and when I did I found I was very good at it and getting it done, I didn't really get distracted. I also love going to cafe's and being able to work off my laptop at them sounds incredible, a dream I've always had.

    All that being said, I want to make a serious endeavor into this industry. I personally THINK I would be able to go strait into being my own agent. I want to be responsible for my own person, be my own boss (yes I know there are butts that must be kissed still) and put the hard work into my own business. I THINK with the experience I hold I would be able to get some contacts, start small and work my way up. I've also heard that SOME carriers realize you must get paid to pay them. All that being said, I would prefer to go strait into being my own agent and starting out my own business. Is this possible? If not... Are there companies who would hire me as I stand right now? And would I be able to work from home with them? What kind of pay do those jobs offer? I know as an independent agent you can actually make some great money, I'm sure it takes working up to it but again, knowing your efforts are not in vain and will pay off to you at some point. If I must work for a company first, I'll grit my teeth and do so. I also plan on getting the certificate from either one of the schools or home course curriculum. It can only help, right?

    Thanks for any help and advice, it is much appreciated.
     
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  3. BoyWander

    BoyWander Road Train Member

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    I've been at it 3 weeks, very difficult to find a customer, and the ones I have found, they either want someone established, they want the cheapest rates possible (hard to compete with big brokerages), sometimes absurdly low rates, or they want service that's very difficult to provide, like steady drop n hook service from suppliers located in places where it's very difficult to find carriers interested.
     
    Disgruntledriver Thanks this.
  4. Disgruntledriver

    Disgruntledriver Light Load Member

    Interesting. Are you working for a company or are you your own agent? Also, did you have any prior experience? What about office or phone experience? Sorry, just probing you for information so I can get better ideas.
     
  5. G/MAN

    G/MAN Road Train Member

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    If you want to broker freight and get your own authority, you will need enough money to put up a $75,000 bond and sufficient financials to pay carriers until you get your money. You could become an agent for a carrier, but most will want you to have experience and a book of business you can bring with you. You might be able to become a sub agent for an established agent. Another way to get started would be to go to work for a major brokerage.

    Most agents and brokerage firms pay on percentage, especially starting out. Working from home can be difficult for some people. You need to be very disciplined. You need to treat your time the same as if you were working in an office. Plan on spending 8 or more hours on the phone. You won't be able to sit at a cafe and do your business. If you book a load you will need access to a printer and/or fax. Your schedule will be that of your customers. If you are on the east coast and have customers on the west coast as well as east coast, you will have long days if you want to build your business and be successful. When you book a load from a shipper, you will need to find a truck in order to keep the account. I have had brokers call me on Saturday and Sunday when they have been a bind and need a truck.

    Your experience behind the wheel can help you in the brokerage side of the business, but there is much more to it than you may think. I also think you will need to make a greater commitment of time than you may expect. Let us know what you decide.
     
  6. Inland-Pilot

    Inland-Pilot Light Load Member

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    I'd say continue the research, know what you're getting into and go at it full speed. You sound like ya have a good sense for what it takes and will be successful. Good luck.
     
  7. Disgruntledriver

    Disgruntledriver Light Load Member

    Thank you for the replies. Believe you me, I fully understand. If I have to put all my waking hours into it, it's still better than doing that in a truck and having to commute 45 minutes every day. I don't mind putting in long hours for something like this, I think my time in a truck also taught me that, how to put in long hard hours and discipline. I'm sure that throughout the day you would have time to go into your kitchen and make a salad or fix some chicken. I also know you have to be in "work mode" and not "Between browsing the web I'll work on it" mode. I get it, believe me. I know it will take some time before I'm able to take a more "cafe" approach to it. Whatever it takes, I'm willing to do it. I do need to do more research into the bond/surety bond thing. I know there must be ways to get such bonds, to pay carriers, etc. That is what I'm asking here, information on how to do such things. I'm not going to jump into this tomorrow, but I want to get as well prepared and informed as possible. I am sick of a huge company running my life, playing psychological mind games on me and deciding when I can go home. I don't mind hard work, but some times I feel like a slave and I just hate that. That's what motivates me so fully to make something like this work. I know there must be a ton of people who come in and want to do something then start off on the wrong foot, uneducated and with the hopes of getting rich quick. That's not me. I want to make a good life for myself and my family and this looks like it would be a good path to pursue. Thanks again for the help, any answers to my questions will be much appreciated.
     
  8. Disgruntledriver

    Disgruntledriver Light Load Member

    Also, what is the bond used for? Is it used to pay the carriers? Is that your starting capital or is it more of an insurance for the shippers and carriers, simply there if you need it?
     
  9. G/MAN

    G/MAN Road Train Member

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    It would be much easier and less stressful for you to find a broker who will take you under his arm and train you how to sell capacity. A broker is a salesman. He sells himself and his abilities to move shipper freight and then sells a carrier to move the load he booked. 90% of a salesman's time involves prospecting and identifying new customers. Only a small percentage of a salesman's time involves closing the sale. You may already have some contacts that would afford you a foot in the door. Sales is a numbers game. If you call on enough prospects, you will close sales. An experienced broker or agent could teach you the basics you need to get started. Later, you could get your broker authority and go out on your own. I know some brokers and agents who have given up their own authority to become an agent for a major carrier and/or gone with another broker. Some don't bother getting or keeping their authority. They do very well working for another company. As an agent you don't have to worry about paying the bills or collecting the money from shippers, for the most part. Agents may need to make a few calls if a shipper is longer than agreed.

    There are ways in which to finance or cover the broker bond and working capital. But, you will be dealing with a learning curve for at least a few months. I don't do business with a new broker unless they have been in business for at least a year or two unless they can either prepay or pay COD. I prefer not having to deal with collecting checks COD. Some shippers will take 45-60 days or longer to pay. During that time you will need to pay carriers for loads they have hauled. You could factor your receivables, but that will eat into your profit margins. You may also be able to get a line of credit from your bank. Not having an established business might make that more difficult. In any case, you will need assets, preferably real estate, to cover your line of credit and bond. That is one reason why it makes more sense to find a company that will take you under their wing and assume the financial risk in addition to teaching you the business.
     
  10. G/MAN

    G/MAN Road Train Member

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    The bond is a performance bond. It is used to pay carriers if you are not able to pay them. If you go to a company that writes these bonds, you can usually expect to pay about 10% of the bond amount and that must be paid each year. You will need good credit and assets to cover the face amount of the bond. You don't want a carrier to ever file on your bond. That is one thing carriers will check prior to doing business with you. You cannot get broker authority without a bond on file. Broker authority costs $300. Working capital is in addition to your bond.
     
  11. Disgruntledriver

    Disgruntledriver Light Load Member

    I don't have any real estate, I live in a apartment. I hope to change that some day. How would I find myself some one who would "take me under their arm"? By that do you mean working under an agent or going strait to a company? If I worked for a company, would I be able to work at home? What kind of salaries could a company broker expect to make? Let's say I did that for a year or two and got some contacts, then I was ready to become my own agent. Wouldn't I still have the problem of finding the initial capital to pay the carriers? I do agree, it might be a good way to really learn what to do and polish my skills at it. Are all these broker schools really not worth the time? I wouldn't mind putting up a bit of money if it taught me enough to combine with my knowledge to make this whole thing go successfully.

    Thank you kindly for the reply.
     
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