John Thomas on Freight Brokering

Freight Broker Trainer on Vacation

Yes, I needed a vacation. I'm writing this from Zacatecas, Mexico after spending several days in both Puerto Vallarte and Guadalajara. It's been a good trip except for a broken motor mount that turned out to be not so bad.

The gentleman who repaired it in Guadalajara was plastered with grease and oil from head to toe. I wanted to ask him if he needed some time to take a shower. BUT, it soon became apparent that he is so good and his business is booming so much that he doesn't have a lot of free time.

My lesson: don't trust a mechanic with clean clothes.

We will be heading back north in several days and I should be back in my office on Monday.

Despite the fact that I'm supposed to be on "vacation", I have signed up several clients and have tons of phone calls to make. I have been able to make some call backs but not all of them.

You WILL get a call back if you have left your info.

Finally! Affordable, Comprehensive Freight Broker Training!

The latest addition to our Freight Broker training options is our Home Study Mini Course. It's referred to as a mini course but the only thing that is "mini" is the cost.

This Home Study Course is just slightly condensed from the One-on-One Telephone & Internet training that we provide and is geared for those who are seeking comprehensive yet affordable training.

Check it out now. Go to: Atex Freight Broker Home Study Mini Course

What About Lumper Fees?

I just got off the phone with a client from eastern Pennsylvania. He is driving a truck and knows the eastern seaboard very well. Here is a question: what does the eastern seaboard have more than any other geographical area? Answer: high (very high) unloading fees depending on the exact area.

New York city is a nightmare for many if not most truck drivers. If the truck driver trusts the freight broker to reimburse them for the unloading fees, all is well IF the broker can get his reimbursement from the customer.

Before you start moving cargo into the east coast, learn what to expect regarding the unloading fees. They may shock you.

In my opinion, the shipper (or consignee) should pay for the lumper fees but often times these fees are pushed off onto the freight broker. When I was brokering, I did NOT push them off onto the truck. So, what that meant was that I needed to get enough from the shipper to not only pay my desired profit but to cover the unloading fees as well.

It's a difficult task and you have to be careful or you will be eating beans for dinner for a week or longer.

When I Was a Freight Broker .....

When I was a freight broker, I learned something nearly every day. There are certain aspects to this business that seem to never change. And then there are days and weeks when you really learn something different all the time.

One such case was the difference in rates from two similar shippers right here in El Paso. I was moving cargo out of this one company and getting very good rates. The rates were not excessively good rates; but I had 2-3 local carriers calling me sometimes two times a day for loads.

So, then I decided to call this first company's competitor right down the road. And their rates were lousy! I can understand lousy rates - a lot of shippers are pushing lousy rates.

But the fact that these two companies with similar cargo were moving their loads with different rate structures really puzzled me (unless the first company just happened to like me and the second didn't - but I doubt it).

But I learned that you can NOT assume things. For example, if I had first called the lousy paying shipper, I might have thought, "What's the use calling the other? They both have lousy rates".

So, don't fall into the trap of assuming something. The fact is it may not be true at all.

Getting Started: We Take the Pain Away

For some people, starting a new business venture is somewhat intimidating. However, it does not have to be this way. We usually start by asking clients if they have thought about a business name and a form of doing business. Some people know right away what they want, others need to think about it or, if there are partners involved, I encourage them to take whatever time is necessary to get things in order.

It's about 50/50 on those who want to incorporate versus those who want to start as a sole proprietor. We sometimes help the client do a name search and it is done a little differently depending on whether you are going to get incorporated or not.

Finding the articles of incorporation on the internet is usually no problem and they are usually one to two pages and not very complicated. A sole proprietor usually registers the business at the county clerk's office and that's a no-brainer.

You don't necessarily need an EIN number for a sole proprietor but even with a corporation, we help you walk through the steps. If you plan to start as a sole proprietor at first, you can always switch to a corporation at any point down the road.

Getting started by forming a business entity is not the most exciting thing in the world - but it is the necessary starting point. One thing for sure, it is not all that difficult to get started on setting up your empire regardless of how large or how small you desire it to be.

Freight Broker Competition

With the many phone calls and emails that I receive, I am usually upfront with the freight broker situation as much as I can be. After all, people want to know BEFORE they commit what is the industry like.

Usually, I tell them it's competitive. And this is true. But, on the other hand, it's not the entire story. Here's why.

In any business including freight brokering, the ultimate key marketing advantage is to go into areas that others are not serving. And then you master that niche by pouring on the best service you can possibly give.

If you work yourself into your special niche, you virtually have little or no competition. One niche might be a special type of produce, for example. Another niche might be oversized machinery of some type. I know there are some growers who will not work with a broker unless the broker has demonstrated experience in moving that kind of product. And with the oversized commodities, some freight brokers focus entirely on that niche and learn all there is to learn in that particular area. They basically leave no choice for the shipper to go anywhere else but to them.

In both examples, the freight broker does more than just get a truck to move some cargo from point A to point B. They immerse themselves in their specialty and learn all the potential pitfalls and challenges for each of their niches. And then they provide the solution to these "obstacles".

So, if you are fortunate enough to get into a niche and master it like no one else, you can say goodbye to your competitiors plus make far above average profits as well.

Freight Brokering: How to Keep from Freaking Out

I have a few clients who, after finishing the formal part of training, sort of freak out at the thought of a customer actually giving them an order.

This is normal for some people.

And if this is a roadblock for you, read on. Here is how to help overcome this potential roadblock.

After formal training, you will want to go through a mock situation.

Usually the first thing you will do is to call shippers. So, you would review the materials on finding shippers and getting set up with them.

Then the next thing you will do is to take the order. So, you would review the materials on taking the order.

Then the next thing you will do is to post your loads on the loading boards. So, you would review the materials on posting loads, calculating rates, etc.

Then the next thing you will do is to expect getting phone calls from carriers who are interested in taking your load. So, you would review the section on prequalifying the carrier and booking the load.

And, so the process goes on and on until you finally collect your money from the shipper.

The point is, don't try to think about the entire process all at once. You can only do five or ten things at a time, not twenty or thirty (just kidding).

But, if you discipline yourself to take one step at a time, you will very quickly get into a routine where you will not only not freak out, you will be working smoothly and efficiently without a lot of stress.

5 Steps to Freight Broker Success

The freight brokerage business is not necessarily complicated. You don't need
a lot of formal education. You DO need to know, however, the essential steps that will
get you organized to operate successfully.

Go here now to find out: Freight Broker Success - 5 Steps