10 Steps on Starting your Freight Broker Business from Home
How often have you spent late Sunday evening, getting things ready to start the new week and wondered how your life could be simpler? Wouldn’t it be nice to work from home, earn a nice income and have the ability to enjoy time with my family?
During the covid pandemic, I was one of the unfortunate persons and was laid off of my job. I knew that I did not want to be in that category anymore and wanted to make a change. So, I made the decision to use Google to check on my options on how to make my life simpler and more rewarding. That is when I came across “Build a Freight Brokerage with little start up”. I already had some working experience in the logistics industry and developed a passion for the transportation industry even more, so I dug deeper and started learning the basics of how to become a freight broker.
Is Becoming a Freight Broker a Good Career Choice?
For a individual who is motivated,a self-starter, and can manage multiple tasks at the same time, then the freight brokering business can be a rewarding and lucrative career choice. ... Even industry outsiders can become successful freight brokers if they're dedicated to learning the business
Incentives for becoming a freight broker
Below are several reasons why you should become a freight broker :
· You do not require any experience so as to get started
· The cost of starting up is quite low
· The freight broker industry is currently worth $400 billion and is growing annually
· It is possible to work from home
Before I Started to Build My Freight Broker Business, I needed to Know exactly - "What is a Freight Broker" ?
A freight broker is someone who assists shippers with freight ready to haul by finding carriers (drivers) who are qualified to haul the load. They are responsible for arranging the transportation and tracking of a load hauled by a freight carrier. A shipper has their wants and needs, and a driver or transportation carrier has their needs and agenda; this includes anything from pre-planned routes to the type of deliveries each truck can make. So basically, a freight broker is your “middle man” between your manufacturer and the transport that will take your product to its destination.
This sounded like it was going to be a great option for me and I wanted to start right away. Next I began looking at where to get started from the very beginning. I found LFS Logistical Development Program that would help me from the beginning to the end.
My 10 Steps On How To Become A Freight Broker Business With No Experience Are :
1. Become Knowledgeable And Take An Online Freight Broker Training Course.
The first step to performing this job is to study. It is important to know how the freight industry works before you can begin to perform as a freight broker in it. You can learn by finding an online training course to gain knowledge on how the enterprise operates. The freight broker training course can inform you about the characteristics of the freight industry, how to find shippers, working with carriers and agents, and how to manage your freight broker business.
A solid freight broker training program will also show you how to transport freight at a cost which is profitable for you as well as the carrier. The course will also help you to stay compliant with federal laws under the guidelines of the FMCSA and the strategies that you can use to operate your enterprise successfully. I highly suggest enrolling into Logistical Forwarding Solutions freight broker training program. The Freight Broker Course for me was Priceless and only cost $350.00 which is a small investment for such a rewarding return.
2. Choose Your Company Name And Register Your Freight Broker Firm
It is exciting to pick a name for your broker company. As you do so, select the most appropriate type of entity for your business and make it unique. In this step, it is highly recommended to register your business as a corporation (Inc.) or Limited Liability (LLC). The registration can be done at your local business license department. Having done so, proceed to get your Tax Identification Number from the Internal Revenue Service (IRS). This process can take up to a month to complete and cost you between $300 and $1,000.
3. Draft A Business Plan
Perform some market research. After that, create a business plan that incorporates all the information that you have found. Pick a market niche (Reefer, Dry Box, Flat Bed,etc) and adjust your marketing strategy to meet its needs. If you can, it is a great idea to hire a business consultant/mentor to assist you in drafting the business plan. This process can take an average of 1 month and cost between $0 and $1,000.
4. Finding the Appropriate Carriers To Work With
Your reputation as a freight broker depends on the quality of the services that you offer. Identify carriers that provide correct services for your niche and customer base. As you do so, make sure that they are reliable. It is important to check on their Safety for you to find partners that are trusted. You can use your networking skills to gain a portfolio of trucking carriers. This is a continuous process that is always ongoing as you develop your career as a freight broker.
5. Obtain Your Freight Broker Authority Thu The FMCSA
For you to operate as a freight broker, you need a USDOT number. You can register for one through an OP- Form. The registration can be performed at the Motor Carrier Operating Authority. If your application is approved, the FMCSA will send your USDOT number to you. This process normally takes between 20 to 25 days at a cost of $300.
6. Apply For The $75K Surety Bond , Freight Broker Bond (BMC-84)
This specific bond shows your financial strength and sense of responsibility. The $75K Freight Broker Bond indicates that you can guarantee payment to trucking companies and shippers in case you fail to comply with contract agreements. The BMC-84 requires annual renewal. You can read more about the ZSurety Bond Freight Brokers are required to have here. Freight Broker Bond Info
7. Get The Right Freight Broker Insurance
Most shipping companies prefer to deal with professional brokers who are financially secure and insured. To demonstrate professionalism, you need to invest in some insurance. This can be done by buying Contingent Cargo and General Liability Insurance. It provides ample protection for you as a broker. You can get several different quotes and find one that works best for you and your company. This process can take up to 2 weeks.
8. Invest In Your Freight Broker Home Office Equipment
If you want to be a freight broker and work from home, you need some essential equipment. This includes a printer, computer, fax machine (most transactions are done digitally in today’s market so this is an option), and a copy machine. You also need a smartphone / landline phone, office supplies, and a good Internet connection. For added efficiency, you can invest in some freight brokering software. Working from home is rewarding and you need to make sure you can operate efficiently. Obtaining good equipment is key to your success and enables you to streamline your daily freight loads.
9. Find a Freight Factoring Company
Start-up freight brokers are eligible for factoring. In fact, partnering with a factoring company is an excellent way to establish your credibility and offer Quick Pay to your carriers. Paying your carriers and covering upfront expenses can be tough when shippers are slow to pay invoices. You can learn more about freight factoring by visiting the LFS Freight Factoring web page that will give you a more in-depth understanding on how freight factoring works within the logistics industry.
10. Apply Marketing To Your Freight Broker Business
This is the last step to becoming a freight broker with no experience. Set up your enterprise marketing strategy. After that, design a superb logo and some branding as well. Construct a website to show your expertise and portfolio of satisfied clients. Moreover, print out some marketing material (flyers, business cards) and ensure that it has clear coherent wording. Distribute the marketing items to trucking companies and carries and you will be in business!
In no time,you will be on your way to a lucrative income working from home as a freight broker.
See below for an updated current salary for work from home freight brokers.
928 salaries reported, updated at Aug 19, 2020
$61,563 per year