If you’re thinking about getting into freight brokering, there is no time like the present. Right now, freight brokering is a booming business, and you’d be doing yourself a favor if you started your brokerage anytime soon. Since the economy in the United States has begun to improve, the demand for freight brokers is now on the rise. As long as you are willing to invest some time and effort into learning this new business, you should be able to achieve plenty of success.So, how can you become a freight broker with no experience? You can become a freight broker with no experience by following the steps below:

  • Learn some industry experience
  • List potential Freight Broker partners
  • Participate in Freight Broker Training and ongoing education
  • Make a professional LinkedIn page
  • Reach out to potential partners
  • Choose your company name and register your business
  • Create a business plan
  • Locate good carriers
  • Get a USDOT Number and Your Broker Authority
  • Obtain a Freight Broker Bond
  • Get Contingent Cargo Insurance and General Liability
  • Designate agents
  • Purchase your equipment
  • Get some operation capital
  • Start marketing your business.

Since there isn’t much information available on the Internet today regarding how to become a freight broker with no experience, we created this guide to help you out. Below we will cover the steps you’ll need to take to become a freight broker, and we’ll include some background on the industry.

Before You Become a Freight Broker

Becoming a freight broker has become a popular prospect since the U.S. economy improved after the recent Recession. The market for freight brokering is a growing industry, according to Forbes, meaning there is an ever-increasing demand for new brokers. Below we’ll cover some information you’ll need to know before you launch your career and achieve status as a successful freight broker.

Before you start following the steps on our list below to help you start your freight brokerage, you should understand a few things about the role of a freight broker. Besides being a lucrative job opportunity (some freight brokers make $90,000 per year), freight brokers are necessary for transporting goods and cargo. In many ways, freight brokers are a huge part of the backbone of our economy, and they help keep the economy moving forward.

Freight Broker Job Description

The movement of freight in the United States is an outstanding job that many freight brokers perform well. Moving freight is the critical missing link we see when it comes to shippers and carriers. When companies use a freight broker, they can negotiate better shipping rates and arrange faster deliveries for their customers by connecting their clients to businesses that want to transport items. That way, carriers can get the most out of their loads and trips.

So, brokers act as intermediaries in many cases, but they also perform other vital services. Freight brokers need to track their freight well and keep complete records of pickups, deliveries, and different types of information. Freight brokers also need to be well-versed in the legal areas of transportations since they must know everything about shipping regulations as well as procedures.

As a freight broker, you’ll be working to ensure each step in the transport process happens correctly so that the items arrive safely to their destination. You’ll also have responsibility for several important areas of the shipping process.

Starting Your Freight Brokerage

Even if you feel apprehensive about starting your freight brokering business, you shouldn’t worry too much. The steps you’ll need to take to begin this business won’t necessarily be complicated or stressful. However, it will take some time and effort to get through each step on our list before you should consider launching a freight brokerage business.

So, what do you need to start working as a freight broker? We’ve got the steps listed for you below.

Step #1: Learn and Get Some Industry Experience

First, you’ll need to focus on refreshing and developing some general freight brokering skills. Learning how to negotiate freight does mean you’ll need to get some experience in the field and take time to learn, but you’ll find that nothing about this job can’t be ascertained with some time and effort. If you have a strong desire to learn how to become an excellent freight broker, then you should do just fine. There are a few skills you’ll need to make sure you have before you become a freight broker.

Math Skills

When you become a freight broker, you’ll probably be using a few things you know about math almost daily. Much of brokering freight has to do with simple, necessary addition and subtraction calculations, as well as keeping track of time and the quantities of the items you are shipping. Beyond your fundamental math skills, you’ll also need to use plenty of critical thinking to help you understand when you should jump on an opportunity.

Communication Skills

You’ll also need to have fantastic communication and people skills since a lot of the work you will perform will take place over the phone, or via email, when you negotiate and close deals. If you are also able to gain some experience in the transportation field using a different job, that can also help you with brokering, because you’ll be able to network and get to know some of the famous people as you perform your job.

Freight Broker Training

If you want to obtain the best training to become a freight broker, then you should take a freight broker class or following creators who are creating helpful content for free. There is a bevy of different freight broker training experts and we have them all listed in our Freight Broker Training Resource found on our website.

However, you can always search for your own. Just make sure you take time to look at reviews from people that have previously taken the classes. Regardless of what class you attend, paying to get some broker training with an expert can help prepare you to succeed in the industry, and also connect you with some of the most influential people in the industry.

By taking classes, you’ll learn some fundamental knowledge about your work as a freight broker, how to deal with shippers, and how to handle different shipping rate negotiations. Plus, training can also help guide you toward available freight broker jobs, allowing you to find the opportunity of a lifetime and eventually become an independent freight agent.

Step #2: List Possible Freight Broker Partners

Next, you’ll want to begin your list of possible freight broker partners. When you start, you’ll mostly be focusing on people that are local to you and within driving distance. However, you don’t need only to limit yourself to local brokers if you want to do more research. It would also be helpful to look for smaller companies because they are more likely to hire a new freight broker with no experience than a larger company would be.

So, we recommend avoiding the big freight companies like XPO Logistics, CH Robinson, Coyote Logistics, Total Quality Logistics, or any other massive brokerage company since they will be far less likely to hire somebody inexperienced. However, if you are smart and don’t mind an entry-level primary freight job to get some essential experience in the industry, then you can apply to some of these larger companies.

You can search for freight brokers by looking at places like www.thomasnet.com, www.Internettruckstop.com, and www.Getloaded.com.

Step #3: Make a Professional LinkedIn Profile

To get yourself noticed and attract some attention from freight brokers, you’ll want to make a professional LinkedIn profile. When you make your profile, spend some time discussing your qualifications, experience, and any training you have completed that qualifies you to become a freight broker. You can also use other relevant types of preparation, including marketing, customer service, sales, computers, communication, etc.

After you’ve finished your LinkedIn profile, you’ll want to make sure it demonstrates that you have a positive attitude, are a hard worker and that you want to prove your value to a freight broker. By getting those points across, you should be able to make some valuable connections on LinkedIn that could lead you toward job opportunities.

Step #4: Contact Possible Freight Broker Partners

Next, you’ll need to start reaching out to contact potential freight broker partners. There are many different ways you can do this.

  • You can search around and reach out to people that work at your target company by researching on LinkedIn. By doing this, you’ll get some recognition from these companies. After you connect with some people from the company, reach out to them and ask, “What’s the best approach to get started as a freight broker with your company?” You want to develop a working relationship with these people and eventually take the conversation offline into a call or face to face encounter.
  • If you already know some people in the business, talk to those people and ask them for referrals into companies that might work with you. Ask these people to do an email or phone introduction for you.
  • If you have the determination to do so, you can cold email or call sales managers from companies and ask them what the qualifications are for their freight agents. Find out if these companies have any job openings.
  • Try to set up a phone call or face to face encounter with your connections and let your connections know you want a chance to become a broker for their company.
  • After you’ve set up the call or encounter, make sure you tell your connection why this job is your goal or dream, and let them know you’ve been researching in the industry and also taking some training courses.
  • If you are comfortable working on straight commission only, you can tell these companies you’ll prove your worth by working on a commission-only basis, so you’ll only get paid when you attract new customers for your company.
  • While not all companies may respond well when you try to communicate with people, if you start by focusing on smaller or newer freight brokers, then it will be much easier for you to find an opportunity. Remember, you should be ready to tell people why you want to work as a freight broker, and also offer to prove yourself at no risk by providing to work for commission.

Step #5 Pick a Company Name and Register!

If you want to own your own brokerage legally, then you’ll need to pick a name for your company, and then register your business. Before you choose a business name, you’ll need to check to see if your selected name is already in use at the US Patent and Trademark Office.

When you register, you’ll also need to decide on the type of entity you want to register your business as, which includes a partnership, sole proprietor, or limited liability company or corporation. Then, you’ll need to register your business in your current state at your nearest business license department.

Step #6: Make Your Business Plan

You’ll also need to make sure you’ve created a solid business plan, which is a critical step in this process. Once you establish a solid business plan, you can get a line of credit with your bank as well as figure out what niche you want to target. If you can include a go-to strategy and invest in figuring out how the market works, then you should wind up with a solid business plan that might allow you to get a line of credit from your bank for your company.

Step #7: Locate Excellent Carriers

If you want to become successful at this business quickly, then you’ll need to figure out how to find top carriers. You want to locate carriers that work in the field that you’ve also decided to work in, but you’ll also want to make sure the carriers you work with can be trusted and act like professionals. While it might take some time to locate top carriers, it is quite possible to do so.

We recommend using online directories as well as direct references by other brokers so that you start networking and finding those top carriers. Using LinkedIn also gives you another opportunity to reach out to some carriers and establish relationships.

Step #8: USDOT Number and Broker Authority

Once you understand your role as a freight broker and you’ve taken some of the above steps to begin your education and formulate a business plan, you’ll now need to move on and understand some of the legal issues behind becoming a freight broker. Before you can start working, you’ll need to apply for your freight broker license from the Federal Motor Carrier Safety Administration (FMCSA). Getting this license is also sometimes called obtaining your Motor Carrier Operating Authority (MC authority).

  • The first thing you’ll need to do is obtain a USDOT number, which you will need for your application form.
  • After that, you’ll need to begin your registration process on FMCSA’s website. You’ll need to fill out the freight broker application form, OP-1, and then pay the one-time application fee, which costs $300. If you need some assistance filling in the OP-1, go here. It takes anywhere between four to six weeks to process your application.
  • Once your application gets approved, FMCSA will mail you your new MC number through snail mail. Once you get your MC number, however, you still won’t be ready to kick off your business.
  • When the MC number is issued, it goes on the Register page of the FMCSA. Then, any person that might have a problem with your registration has ten days to protest it. Once that period ends, you’ll get your MC authority.

Step #9: Apply for a Freight Broker Bond

When applying for your MC authority from FMCSA, you’ll also need to get a freight broker bond, also known as a BMC-84 bond. Back in 2013, the bond requirement went up to $75,000 to ensure accountability as well as excellent industry standards.  If you have no experience working with surety bonds, then you’ll need to know a bit about what they are. These bonds are a three-party contract.

Your freight brokerage works as your principal, FMCSA is the oblige, and the surety is the individual providing the bond. A freight broker bond guarantees that you’ll apply all necessary rules and regulations when you start brokering. When you think about it that way, you can see how a relationship works as an extra line of credit for your company.

Since there is risk involved any time you do this, when you apply for this bond, the surety will analyze your personal and business finances, your credit score, and your business’s stability. After you’ve been evaluated, you’ll be told by the surety what your bond premium is, and your freight broker bond cost. You won’t need to pay the entire bond, but only a percentage instead.

What you are likely to pay depends on your credit score. If your current credit score is above a score of 700, then you’ll probably pay a premium between 1.25% to 3%, or between $935 to $2200. If your credit score is between 650 and 699, then the percentages go to between 3.5% to 5%, or $2,600 and $3,700. If you have bad credit, don’t worry; you still have a chance to get bonded through a poor credit program. You will have to pay a higher premium, but you should always be able to achieve your dreams.

Another thing you’ll want to think about before you become a freight broker is your credit score. Before you get to this step and apply, do a few things to try and improve your credit score if you want to pay a lower premium. Since you’ll need some time to finish school and get through the many other steps we listed, you’ll have some time to rebuild your credit.

Step #10: Get Contingent Cargo Insurance with General Liability

Once you get your MC number, you’ll be able to get insurance and your surety bond. You’ll need to fill out Form BMC-34 to cover any loss and damage issues, Form BMC-91 or BMC-91X for bodily injury issues, property damage, and environmental registration. You’ll want to fill out these forms and get all of the necessary insurances because if you don’t have them, some shipping companies may turn you down for work. Often, shipping companies will ask to see your insurance before you work for them, so you’ll want to have all your insurance together before you kick start your business.

Step #11: Choose Your Process Agents

Now that you’ve gotten your bond and your insurances together, you are ready to figure out the process agents you’ll need to talk to depending on each state you with which you do business. You need to complete Form BOC-3 (Designation of Agents for Service of Process) and turn it into the FMCSA once you are done.

Step #12: Purchase Your Equipment

While you may not need a physical office building location when you first start your brokerage, you still do need to purchase a few other things for your daily operations. Before you get started, you’ll need a few vital components to run your business, including a computer, a printer, a fax machine, a copy machine, office supplies, a mobile phone, a landline phone, and a good Internet connection.

You may also want to invest in some freight brokering software because it can automate some of your workloads and make you much more productive, boosting your earnings overall. As you get more experienced, you’ll find other software and your processes for approaching things that will make things easier to do.

Step #13: Get Some Operational Capital

Most of us don’t have a steady stream of cash available to us when starting new ventures like this. If that’s the case for you, you may need to apply for a line of credit before you can get your business going. Remember, you will work as the middle man between the shippers and the carriers. There will be many times when you’ll have to pay a trucker for a shipper before you’ve got a payment from the shipper. So, it does take some juggling work to run this type of business.

After you’ve gotten your business plan together and received your line of credit, you should be on the right side of things financially. You’ll have enough capital to get through the rough patches, and you’ll be able to kick start your business.

Step #14: Start Marketing!

The last step you’ll need to consider is how to market your services to your clients. You want to focus on what makes your company stand out and try to get your message across as successfully as possible. Create a marketing strategy using social media accounts for your business. Add regular posts and updates to an excellent website with a blog and include some printed materials. Share those posts on social media as well. Nowadays, these are the types of things that impress clients.

Final Thoughts

Now that we’ve covered all the steps to become a freight broker with no experience, you should be able to set up a plan and start working on achieving your goals. You should begin by familiarizing yourself with what freight brokers do, reading materials and textbooks, and also taking a course or to. Then, you’ll want to review how to become a freight broker and kick start your business. After you’ve taken steps to start your business, you should be ready to get going.

With a career like a freight broker that is in such high demand, you should be able to obtain plenty of job security and financial security for both you and your family. So, now it’s time for you to get started, and good luck!

About the Author

Blythe Brumleve
Blythe Brumleve
Creative entrepreneur in freight. Founder of Digital Dispatch and host of Everything is Logistics. Co-Founder at Jax Podcasters Unite. Board member of Transportation Marketing and Sales Association. Freightwaves on-air personality. Annoying Jaguars fan. test

To read more about Blythe, check out her full bio here.