Confusing truck brokers with trucking companies may be easy. A truck broker is a company that acts as a liaison between another company that needs shipping services and an authorized motor carrier. Often also known as freight brokers, they do not own or maintain a fleet of vehicles but play an important role in moving cargo. They determine the needs of a shipper and then connect that shipper with trucking companies with which they have a partnership who are willing to transport the cargo at an acceptable price.
Using Truck Brokers
Both shippers and motor carriers find the services of truck brokers to be very valuable. They can help shippers find carriers of a reliable nature that might otherwise be difficult to locate. They can also assist trucking companies in earning money for transporting a wide variety of items and filling their trucks. They can either be a primary solution for the transportation of cargo for a company or complement current carriers. The income of freight brokers comes from commissions.
Both midsize corporations and companies with private fleets use freight brokers. Because of their existing relationships with carriers and their ability to locate resources in a hurry, they can provide more competitive rates along with high-quality customer service.
Basic Requirements
There is no special training or need to take an exam to be a truck broker. However, the first step towards becoming a truck broker is to obtain proof of insurance, either in the form of a trust fund or a surety bond that will protect both customers and business clients from any loss.
Once this insurance is acquired, then the business must obtain a license from the Federal Motor Carrier Safety Administration (FMCSA) by filling out a form and paying an application fee. The business also needs to fill out a form that designates the legal representative of the business.
Once approved by the Federal Motor Carrier Safety Administration, the FMCSA will issue a motor carrier number, which permits the brokering of loads. Once such trucking authority is granted, additional brokerage authorities can be added to a business so that it can offer its services to a wide range of customers whose needs range from standard, periodic shipping to more erratic and unpredictable order amounts and frequencies of orders.
