Brokerage questions

It's a do or die thing.
Some do real well if they have a good work ethic.
Some die off fast because they don't.

 

Yeah, definitely more risky than going to work for a standard brokerage. But more reward if you can pull it off.

 

What about money? Do new and/or small brokerages run on an operating note from the bank so they can offer quick pay? Regardless the brokerage needs access to some money even if they offer 30 day pay to the carrier just in case their customer doesn’t pay. I know in the zag world the old “you get paid when I get paid” is pretty common but I know that wouldn’t fly in the truckload sector.

Anyway, I always wonder about the money end of it especially when there’s always comments here about how brokers don’t have any overhead compared to truckers.

 

Some do just like some trucks do, factor and live day to day.

Some start with enough capitol and keep increasing it and the business.

 

I thought maybe an operating line would be an option, similar to what farmers do. Get some money coming in and just pay the interest that you owe the bank.

 

Need decent credit and background in running successful business for that.

Many don't have it so they factor. Then live off the advance and hope nothing happens. Just like the trucks, they can't live 30-60 days waiting.

 

I figured this was true but it scares me all the same. Running spot market/load board freight I kind of like using a bunch of different brokerages to spread out the risk.

 

By the time the first reports hit it's usually too late. Old saying, everyone's credit is good until they quit paying.

 

nice good to know.