For as long as their have been suppliers, trucks, and transportation services, there has been a need for an intermediary to coordinate the various aspects of delivery. If you are fed up with your current job or circumstances, perhaps you would like to bridge the gap and start a freight brokerage service business.
What is it?
A freight brokerage service business is a company that connects a supplier that has products to deliver with a motor carrier that is able to transport those products. You basically make the necessary contacts and simply match supplier with driver.
What do you need?
To start a brokerage service business, basically all you need is a telephone, fax machine, and a computer. A desk would be nice, if you do not want to sit in the floor, but even that is optional. With this type of business, it is not the tangible requirements that cause a hindrance, but the less definable personal contact requirements that may create a problem.
Finding carriers
There is no shortage of carriers. Check any phone book, on the internet, or just drive on the interstate and you will see the various trucks available. There are basically two types of carriers: companies and individuals. The key to this search is finding reliable drivers with good reputations. Ask around and talk to others in this field – listen when people speak of certain companies and problems they may have encountered. When you find a good driver or company be sure to utilize them as much as possible.
Location
One of the most appealing aspects of a freight brokerage service business is the flexibility when it comes to a location to run the business. As you do not have clients coming to your office, you actually have the option to set up an office at home and work from this location. While some people still prefer to use a commercial location, it is not absolutely necessary.
One major benefit of utilizing a home office is there is relatively small start up costs required. You will need a few basics mentioned above, but many of these items you will already have at home. Working from home also provides many other advantages, such as a tax deduction, flexibility in environment, and a minimum investment. Often, people interested in working for themselves base that pursuit on the desire to have more control over their circumstances. Working from home meets that desire even more so than simply running your own business, as you will have the opportunity to address other issues during your day.
However, a commercial location has its advantages as well. For example, you will have a more professional work environment. Often, people have a hard time getting anything done in a home office. Unfortunately, there is considerable more expense involved in a commercial office.
The Process
The process of freight brokeraging is a fairly simple one. Suppliers call you when they have a load they need delivered. You check with your carriers to see which company may have a truck available. Once you find a truck, you simply convey the necessary information for them to pick up and deliver the load from the first company.
Records
The types of records you must keep are mandated by the Code of Federal Regulations. You are required to keep a record of each transaction with the name and address of the shipper and carrier, the freight number, the amount of compensation received by the broker, and the date of payment made to the carrier, among other requirements. Be sure to check with the necessary advisers to be sure you are keeping adequate records.
