Becomming a Broker

$200 a load, wow. I`m a broker and I average aprox $55 a load. Small company, averaging about 15 loads a week. There are some loads that I do make $200, but those are few and far between. I average 6% profit margin, and with that you still have to cover overhead just like any other business. If you think your going to make it rich by brokering then think again. As a new broker until you have a solid 2 yrs + under your belt, be prepaired to give away the farm.You will compete with the big boys, CH, TQL, Command ect... just to grab a truck in a heavy lane you will have to have the best price. Get with the credit bureaus ASAP and get esablished. Nobody will want to work with someone that has no credit. More importantly, be a reputable company. Give good solid market rates. Do not start with a low ball offer, thats insulting to everybody.

 

Can somebody please explain, what this 75K bond really means? Does the broker have to pay this money to someone and why is that bond needed anyway?

 

It's a surety bond. You have to have it to get and keep your MC number, just like a carrier needs 1 million in insurance. In the event that you default on your obligations to carriers, they can then get a payout from your bond. You can either place $75,000 in a trust account, or you can buy a bond for $75k from one of the few insurance companies that right transportation broker bonds.

 

Thank you for your reply. Can one be a "broker" without really making this bond? I mean could it be that I'm just a guy who introduces a trucker to a load holder and all of the contracts are made between the trucker and load holder. In this case I'm not really considered a broker and dont need the bond? Am I correct or thinking in completely wrong direction?

 

You can't just go pay $300 for an authority and then make money. You have to first get shippers to put their trust and product in your hands.( unless you planned on being one of the scum baggs double brokering) And then get a driver to haul it for you. Idk about others, but I would stay away from new brokers just because they have no history and I don't want to get shafted. You need either a lot of money or credit to start because you have to pay the truckers whether you get paid or not by the shipper. 4 loads a week @ say $2000 each= $8000 a week*12 weeks(90 days) = $96,000 out before your first payment. Oh and plus the bond and other expenses you have. so, Does it still seem so easy?