Category: Broker News

Grow Your Business With Your Carriers!

Do you want to grow and develop your carrier base as a freight broker? If yes, here are a few tips for you that can help you achieve the desired results.

The reputation of the freight broker depends on the quality of the service they provide for their customers. A couple of elements to delivering high quality of service includes maintaining strong relationships with your carrier partners and knowing carriers who are available to haul loads. Additionally, it is also important to know whether your carriers are providing reliable service for your customers as well; if an issue arises, the customer may view the service failure as a reflection of your company’s performance.

You can develop your carrier base by using your networking skill. To successfully maintain and your rolodex of dependable carrier partners requires skill and strategic thinking. We will discuss a few tips on how to do both. Before moving further, let’s take a deeper dive into the U.S. trucking industry.

An Overview of US Carrier Market

Most of the goods that are transported in the United States of America are transported by trucks. According to statistics, 70% of all cargo transportation is still carried by trucks, and these trends are unlikely to change in the near future.

These trucks, belonging to different categories (semi-trailers, motor vehicles, and 18-wheelers), usually transport goods from one destination to another in the United States of America. All goods, ranging from consumer goods, general cargo to perishable goods, are usually using these trucks.

The U.S. freight brokerages have seen a sudden sevenfold growth. This is due to the fact that the industry regulations have grown stricter than ever before.

Trucking companies

The trucking industry is one of the largest revenue streams in the U.S. economy. The businesses in this field can be very profitable, but it is incredibly competitive. There are almost 1.3 million trucking companies in the U.S. Among them, 97% operate 20 trucks, and 90% operate less than 6 trucks. 

U.S. Truck Driver Population

The U.S. Census states that there are more than 3.5 million truck drivers in the U.S., making driving one of the most popular occupations in the United States. However, the problem for most freight brokers is the lack of truck drivers. Getting good and qualified drivers is difficult, and this problem is causing the slowdown in the growth of many fleets. But this problem can be solved with Owner Operators who are independent freelance drivers that don’t work for a specific company. You can consult them. 

Tips to Grow & Develop your Carrier Base

There are several tips for freight brokers when pursuing potential carrier partners, such as:

Tip #1: Forgo higher profit margins in the beginning to establish a relationship with a new carrier

To attract more clients and raise awareness of your business, you should stop focusing on profitability in the first three months of operation. Only go for growth! Your earnings may suffer a little over these three months, but you will not suffer a loss.

Don’t select the carriers that are willing to work for cheaper if the quality of the other carrier services is not up to par with your core carrier base. If necessary, explain to your carriers that the market conditions have changed, which affects pricing. Always be as transparent as possible with your carrier base.

Tip #2: Continue to give loads to repeat carriers

Nothing is better than repeat business. Like any other business, a freight brokerage company is created not only for profit but also to maintain sustainability over a long period of time, which can lead to expansion. Create a reliable business structure that will allow you to stay in business for as long as possible.

In the beginning, you spend many hours looking for a reliable carrier to move your customer load. Try to utilize a repeat carrier instead of hiring new every time. It will increase overall efficiencies and brokerage while reducing the booking process to minutes.

Tip #3: Gain market share & specialize in a specific region, mode, or truck type

Identify the company’s size (for example, small carriers, midsize carriers, large carriers, or owner-operators), trucks, and area. It will determine whether they are a good fit for your business or not.  Take extra few minutes with the carriers the first time you work with them. Next time they will provide a higher level of customer service and notify you of delays and issues. In addition, they will rarely cancel your shipments after booking.

Tip #4: Keep your carriers informed

Once you build a carrier base, you can book your carriers more efficiently. Managing carriers can be stressful, but “communication is key.” Inform the carriers about the last minutes’ changes or specific requirements. 

Developing a long-term carrier relationship requires continuous contact. For this purpose, make sure to employ the best technology to manage your carrier database — one that goes beyond just storing contact information. ZUUM Automated Broker has a robust Carrier relationship management and onboarding tools for just that.

Taking the time to get to know your carriers, understand their needs, and keep an open dialogue with shared growth in mind will go a long way in building and strengthening carrier relationships.

Double-brokering refers to a risky practice in which the shipper hands off their load to a broker, understandably expecting it to be passed on to their carrier. However, instead the broker hands the shipment off to a secondary broker, usually without the consent of the original shipping party. This is considered highly unethical. Freight brokers sometimes engage in this because they find themselves in a complicated situation or have made a mistake somewhere. Double-brokering is also looked down upon due to the fraudulent activity that occurs in the logistics industry. In the last few years there has been a rise of the secondary broker disappearing and ultimately  stealing the carrier’s pay. This form of double-brokering is illegal and described in the eyes of the law as theft of services, potentially leading to serious fines and even prison sentencing. This is very  different  from  co-brokering, which is done legally, with consent, and with  open channels of communication between the involved parties. The two brokers who have partnered up will then split the profit afterwards.

It is important to know how to spot a broker you cannot trust! Does your rate seem too good to be true? Go down this list, and make sure it’s not!

Investigate them

Do a background check and make sure your broker is who they say they are. Check their credit score and their FMCSA registration. Look for the number on their file and ensure that your load really came from that broker and not someone posing as them. Call the broker directly to confirm details instead of ignoring your suspicions. Although Carrier44 is known best known for carrier safety ratings, they also have ratings for freight brokers as well. 

Develop a trustworthy network 

One way to avoid being scammed by dishonest brokers is to work with parties that you know and trust. Work on building a network with brokers that have been transparent in their dealings with you and keep you satisfied. By having these relationships with brokers you are familiar with, you can avoid having to rely on unfamiliar brokers that may not respect your trust. 

Review rate confirmation

After your load has been booked, carefully read over your rate confirmation. If the rate con requires you to check in as a different carrier than you actually are, chances are high that you are dealing with a double-brokered load. Keep an eye on the paperwork and make sure the bill of lading matches the rate confirmation at pick-up. 

There is also cause for suspicion when a load has an unusually high rate, especially if they also insist their POD be sent to a random email right after it has been delivered. While some brokers feel that they can get away with this practice, shifting laws in recent years have increased legal penalties to help protect the carrier companies that are negatively affected by this. Protect yourself as much as you can, and be mindful when choosing a new broker for your future shipments. 

Was this article useful to you? If you liked reading this, and want to read more like this, click here and visit Zuum!

With new technology that is launched in logistics and transportation, there are many options available for freight brokerages that are looking to transform and gain a competitive advantage. Powerful technological tools that were once considered expensive or difficult to implement in the transportation industry have now been helping companies increase their current profit margin and one that could be available to them with the help of digitization. Every year, new technology is released faster, cheaper, and more efficient than what many traditional freight brokers previously had access to. With recent events such as last year’s spread of Covid-19 speeding up this process significantly. In the midst of all of this unfamiliar territory, are you wondering how to decide which service is best suited for you? Here are some key features any 3PL should be looking for when pursuing a tech upgrade. 

Automation 

A basic necessity for all logistics services looking to increase efficiency, implementing automated services can save you valuable time and effort, as well as streamlining many processes that no longer need to be done by you. Automated features related to manual taskwork and billing/invoice information can be handled faster and with less probability for error. If you are interested in increasing capacity, automation is a simple yet crucial step.

Reports & Analytics Tools

A major tool that should be included in your toolbox, being able to generate predictive reports and readings can be considered a significant asset in an industry that highly values “knowing.” Robert Sutton of BNSF Logistics has this to say on that: “The biggest challenge in the industry is knowing, and having visibility, to match the best load to best carrier to do that load.” Having more information at your disposal can only be beneficial, and it allows for the best decision making when it comes to your freight brokerage.

Secure Integration

To maintain your business’s competitive edge, embracing integration may seem undesirable at first to brokers who question the value of sharing their information, but in fact, integrating has more to offer than not. Think of this: a secure integration done through your chosen product shares information that you want shared; for example, when conducting EDI transactions. Integration offers brokers the increased ability to stay on top of demand, collaborate with ease, and ultimately increase their profit. Allowing your technology to share your offers and needs with other parties gives you wider reach and introduces other parties to you as well. 

Real-Time Visibility

Having access to real time market data and being able to view deliveries in real time is a massive feature that is almost expected now of many businesses, due to customers being used to online shopping services such as those offered by Amazon. Solution providers  that offer digital management services as a logistics control tower, instant quoting, real-time dispatch notifications, tracking services, e-document management and more are able to offer their customers higher rates of satisfaction and visibility. 

User-friendly Interface

Navigating software that is user-friendly and has an easy-to-understand interface is an underrated asset. It isn’t the most important facet of your tech, but it is something that will impact your use of the product and potentially hinder you as well. The user interface can absolutely affect the customer’s experience, as an engaging UI won’t leave them frustrated and finding it inconvenient to return. And as your business expands, so will the volume of data that needs to be organized; with more volume, organization becomes increasingly important. Having grown leaps and bounds in the industry, our technological ability has come far enough that your new technology should be simple to adopt and feel convenient to use. Why settle for less?

Strategic Pricing Tools

The success of a freight brokerage depends on its ability to identify the most cost effective carriers for each of the shipments their customers connect them with. The goal is to maximize profit margin without sacrificing service levels. Strategic pricing tools are especially important when your freight brokerage begins to scale. The Dynamic Smart Rate stays on the cutting edge of automated pricing and enables brokers to capture more bids and win more business. Even if a broker has booked trucks for a specific lane for years, having access to real-time data allows brokers to adjust their pricing based on rate fluctuations or sudden changes. For brokers who run and manage RFP events to identify carriers who best match the transportation needs of multiple customers or lanes. Traditionally, collecting and selecting carriers through an RFP event is a time consuming and manual process. Broker software that has the Dynamic RFP capability allows freight brokerages to remain flexible in volatile markets. 

Speed of Implementation

While speed of  implementation is not necessarily a feature that brokers can easily identify. There are a few ways you find this out for yourself. First and foremost, you can ask the solutions providers how long initial onboarding and implementation has taken in the past with recent customers. Next, evaluate the complexity of the solution. Has the solution provider given enough information and resources to deploy the software and educate key stakeholders. Speed of implementation is often overlooked which results in companies waiting months or even years to fully implement the new technology and see ROI. 

Modularity & Ability to Scale 

Another feature that may not be so easy to identify is whether a solution is modular. This is especially important for companies that expect to scale or rapidly grow. A majority of existing solutions are highly targeted. This results in companies needing to look and implement an entirely new solution. Time, money, and productivity can be lost during this transition period. By considering long term and modular solutions, you are ensuring a smooth transition as your company continues to grow.

If you’re searching for a powerful broker software that truly complements and optimizes your freight brokerage, check out ZUUM Automated Broker. With ZUUM Automated Broker, freight brokers can automate freight management, increase on-time delivery performance, improve customer satisfaction, and achieve higher profits to accelerate growth. Click here to learn more  about available pricing.

Source:

https://www.ccjdigital.com/technology/article/15064921/pandemic-forces-fleets-freight-brokers-to-speed-digitization

Indispensable to our way of life, the logistics and supply chain industry are a source of vast  employment opportunities. Interconnected with a variety of industries, always on the edge of innovation, the possibilities are endless.

According to Harvard Business Review, “the U.S. supply chain contains 37% of all jobs, employing 44 million people. These jobs have significantly higher than average wages, and account for much of the innovative activity in the economy. The intensity of Science, Technology, Engineering and Math (STEM) jobs, a proxy for innovation potential, is almost 5 times higher in the supply chain economy than in the B2C economy.”

One role in particular offers several benefits that can be hard to pass up for those looking to join the industry: freight agents. But what exactly does a freight agent do? They act as the middlemen between companies looking to ship their products and carriers searching for freight to move. Seems simple enough, right? Actually, these middlemen play a vital role in managing communications between these two parties, making sure the freight has been both retrieved and transported properly, and even helping companies optimize their incurred costs. How do they accomplish this? By understanding the industry, relaying updates,and paying close attention on how they can improve their services. Below are some of the top reasons to consider becoming a freight agent. 

1. Anyone Can Do It

By this, we mean that formal education or training is required to become a freight agent. This is increasingly rare in a job market that demands four-year degrees at minimum to be considered for entry-level positions. In supply chain management, career advancement is a very real possibility and allows you to make the best use of your talents. Start learning the ins and outs of the industry, research the needs of the different professionals you will be interacting with, and work hard to create relationships and build your freight network. Delivering reliable shipments and consistent communication will speak for itself. 

2. Work Your Own Hours

Another rare benefit of working as an agent is the flexibility you have with your schedule as you can set your own hours. Rather than being paid on an hourly basis, you are paid according to the number of loads you cover. Whether this takes you one or ten hours, that is up to you and the state of the market. 

3. Work From Home

Freight agents enjoy the luxury of working virtually anywhere with an internet connection,  whether it be from the comfort of their own home or a dedicated office space. This is especially beneficial in the age of COVID-19. This means the cost of commuting can be eliminated. Due to the nature of this work, connecting with customers across the globe will be constant and working in a remote setting is very much the norm.

4. Minimal Cost to Get Started

As straightforward as it sounds, the only expenses that are absolutely necessary, are a phone, internet, and a laptop or desktop. You won’t have to worry about licenses, insurance, or many of the other details that run up the cost of working independently. Another tool to consider investing in is a transportation management system (TMS), which helps to streamline communications and delivery between you, your carriers and your clients. 

5. Maximize Profits

Income is arguably, one of the most important considerations in deciding to pursue a new role–whether you’re just getting started or choosing to switch industries. Freight brokers embody the entrepreneurial spirit. If you are motivated and confident, you can earn good money in this position. The best part is there is no limit on how much you can earn as an agent. The more you freight you move, the more money you take home. Indeed.com currently lists the average base salary for a freight agent at over $60,000 a year. 

To learn more about ZUUM’s Independent Freight Agent Program click here. To see other exciting opportunities with ZUUM, head over to our Careers page.

Sources:

https://hbr.org/2018/03/the-supply-chain-economy-and-the-future-of-good-jobs-in-america

https://www.armstrongtransport.com/blog/should-i-become-a-freight-agent