What Does a Freight Broker Do & How It Helps Shippers

While many people long to get out of their 9-5 job, other industries envy the consistency found within the traditional workday. With freight moving 24/7, most shippers and BCOs have daily tasks that can leak late into the evening. This is where freight brokering was born.

According to a September 2022 press release, “The global freight brokerage market size was estimated at USD 57,433.11 million in 2021 and is projected to reach USD 82,181.65 million by 2028, exhibiting a CAGR of 5.25% during the forecast period.” Shippers must understand the role and types of freight broker companies to choose the right partner for their supply chain needs.

What Does a Freight Broker Do?

A freight broker negotiates the needs of shipping companies to carriers as a means to contract freight transportation. They will ensure shippers only work with those who fulfill federal motor carrier safety administration (FMCSA) requirements. Additionally, an expert freight broker will guide BCOs through cross-border tax and compliance across North America and beyond. Within this supply chain niche, there are two primary categories that offer different freight broker benefits.

Non-Asset-Based Freight Broker Services

A non-asset-based freight broker business is completely dedicated to connecting shippers and carriers. This type of broker can save shippers and BCOs valuable time and money by leveraging their industry relationships for the best rates possible. A freight broker cultivates their relationships with trucking companies so that shippers don’t have to. This frees them to focus on their product.

Asset-Based Freight Broker Services

An asset-based brokerage model means that the broker holds a stake in the supply chain network offered. This could include owning a warehouse, distribution center, or truck fleet. At first glance, this may seem to be a full-service option. However, shippers who partner with asset-based freight broker services can be limited to the broker’s personal network.

Why Shippers Work With Freight Brokers

Many blame current supply chain disruptions on the pandemic, but tenured professionals know that industry weaknesses were simply finally revealed. Even so, consumer demand has continued to outmatch most supply chain processes. With many common problems afflicting the supply chain, it’s easy to understand why a shipper or BCO would reach out to a freight broker company. Some of the freight broker benefits that shippers find include:

• Expert Oversight - Freight brokering services are more than a means to an end, but an opportunity to grow within the industry.

• Industry Clout - The process agents must go through with the broker authority includes the assurance of a surety bond that improves carrier trust.

• Cost-Savings - Although transporting freight is costly in its nature, leveraged carrier relationships get BCOs closer to the honored shipper of choice status.

• Dedicated Problem Solver - Freight brokers keep shippers from running to shady load boards when disruptions happen by providing around-the-clock solutions.

• Optimized Resiliency - Broker agents provide shippers with access to trusted carriers that enable flexibility within big market shifts.

These benefits are multiplied when a shipper needs specialty freight services. Some loads might need a white glove touch to secure the deal with high-end customers. Whereas disruption delays may require the sudden need for an expedited solution. Partnering with an experienced freight broker company means that shippers don’t need to search for expedited ground or air partners frantically - they already have them.

How to Maximize the Value of Your Freight Brokerage Partnerships

Amidst the different services that each freight broker agency offers, they join shippers and carriers with the same goal of transporting freight successfully and efficiently. Shippers must be willing to exercise two primary characteristics to receive the full value that freight brokers can offer them.

Communication

A bad case of under-communication can destroy the most loyal customer. When the expectation is over-communication, shippers must leverage all communication lines established by their broker.

Can automated alerts be passed on to customers? What number should be called when a disruption arrives? Freight brokerage services that offer shippers a dedicated broker agent offer more communication value than a common chatbot.

Clearly-Defined Priorities

Depending on the day, the same shipper might be transporting freight across the globe or across the state. By appropriately understanding the needs of their own clients, a shipper can partner with the brokerage that is the best fit.

Will a truck-specialized freight broker be sufficient, or will intermodal services be necessary? Even if a brokerage has a large enough carrier network for today’s loads, what about in a few years? Shippers can get the most out of their brokerage interactions by maintaining clear, predetermined company goals for their processes and customer relationships.

Get More Value With GEODIS Capacity Solutions

When a professional decides to outsource a task to another individual or entity, they expect their partnerships will maintain their customer value. By offering optimized networks to support the shipper, the right broker knows that they are investing in the end customer. Just any brokerage can’t complete this holistic approach to shipper support.

GEODIS Capacity Solutions stands out among its competitors with its commitment to their clients on both sides of the industry. Shippers can entrust their freight to high-quality carriers that are retained through respect, competitive payment terms, and streamlined communication. Start a conversation with GEODIS Capacity Solutions today to get started.