Truck Driver Training: Should You Consider it?

According to Bloomberg, in 2013, there were approximately 25,000 unfilled truck driver positions across the US, and the shortage for qualified drivers continues. Add to this the median salary of $38,000 and the fact that by 2020, there will be a demand for 330,000 truck drivers in the country and it is easy to understand why trucking has become a sought after career prospect. However, before you are put behind the wheels of a 26,000-80,000 lb monster vehicle, you will need to get a Commercial Driver’s License (CDL). So, here is a look at the options available for truck driver training and what to expect from the programs.

Are you eligible to become a truck driver?

The bare bone basic requirements are simple: you have to be 21 years of age and clear the DOT medical test. Beyond this, companies will also look at a host of other factors when hiring a truck driver. For example:

Driving record

Trucking companies may have some variations when it comes to employment and criminal background requirements but a clean driving record is non-negotiable. If you have been convicted of driving related offenses, no company will even look at your resume for 5-10 years after the conviction. DUIs, DWI, license suspensions will all be career killers.

Criminal history

Although felony cases are reviewed case by case; you will not find truck driving opportunities for 7-10 years after being convicted for the offense. Misdemeanors can also lead to disqualification, depending on the nature of the offense.

Employment history

A poor job history with significant gaps in between can pose a problem, so be prepared to address it if this is an issue for you. Usually, trucking companies will verify your work background for up to 7-10 years. If there are discrepancies, make sure that you have a solid explanation for these.


You will need at the very least your GED, high school diploma or equivalent education. Although this is not a licensing requirement, most employers expect this much.

Options available for truck driver training

truck driver training - image by raymondclarkimagesStudying to become a driver comes in a few different forms. Find a path that is going to work for you to help you get where you’re trying to go.

Studying on your own

You can get your CDL without actually attending a truck driver training program. However, this can be a difficult feat to pull off since you will be expected to demonstrate your ability to operate the vehicle safely and with ease. Also, even if you do obtain your CDL, landing a job without going through a training program will be difficult. Instead, if financing the training program is a problem, you should consider company sponsored training.

Trucking company sponsored programs

These are not free but you have to either pay nothing up front or only minimal fees. However, the trucking company will recover their expenses through salary deductions over a period of time. Some may even offer bonuses eventually which will make the training course free.

There are two ways in which a trucking company can handle the training; they will either send you to one of the CDL schools that they have a relationship with, or they may have a training division in-house. In terms of the topics covered and the type of training given, the basics will be the same with the theory designed to help you get through the written tests.

As far as the vehicles are concerned, you will be trained to operate the kind of vehicles that the company owns. This can be both a pro and a con. The advantage is that the on-job training period will be lowered since you will be driving the very same vehicles that you were trained on. However, if your company trains you to operate automatic transmission vehicles and overtime, if you want to move to another company that has manual transmission trucks, this would mean an additional investment in training or longer on-job training. The worst part is that this may limit your employment options when you want to move to another company/location.

CDL private training schools

These are run by independent establishments. The courses they offer are pretty standard and if you go to a good school, they will also include placement services in the tuition fee. It is also possible to take a truck driving training course from some community colleges. These programs are quite thorough in their approach and reasonably priced. However, they will also be longer than the courses offered by independent schools.


This is a win-win situation albeit it calls for a bit of work. In this case, you go through the interview, pre-employment screening and medical tests before you approach a CDL training school or while you are going through the training. Once you are found to be eligible, the company will issue a pre-hire letter which is essentially their way of telling you that once you get your CDL, you stand a very strong chance of being hired by them. However, this is not a job guarantee, so it would be best to aim for 2-3 pre-hire letters.

Financing your truck driver training

CDL training courses offered by independent schools cost in the vicinity of $3000-$7000. Getting a loan is usually easy and you get 6 months after your graduation to begin repayment, which works out to $125-$200/month. However, if you cannot avail a student loan, these are your other options:

Federal and state grants

Different types of funding are available under the Workforce Investment Act which can cover the entire tuition cost. Dislocated workers who cannot go back to working for the same company, plant or industry are also eligible for these grants.

Company grants

Many employers offer educational/training incentives and truck driver training may be covered by some approved programs. Check with the HR department of the trucking companies you’re looking at for more information on this.

Tribal Council

Native Americans are eligible to receive funding through the Bureau of Indian Affairs or the tribal council.

Using credit cards

If you have good credit history, you can easily get a new card that can be exclusively used to fund the training program. Typically, you can find cards will have an interest free period of a few months that will allow you time to repay them before interest begins to add up.

School offered funding options

Many independent CDL schools offer the option to start training by putting a down payment and paying the rest in installments after you find a job.

VA Loans

If you didn’t have a transportation or driving job while in the military, you can still get the training you need! Most community colleges will offer VA loans. However, you will need to get in touch with the college to find out the amount they offer and the out of pocket cost that you will have to incur.

When choosing a truck driver training school, only go to an establishment that is state accredited. Next, consider the location of the facility. Opting for a school that is away from your home town would mean that you will have to spend more for accommodation or commute.

The price should also be a consideration but certainly not the only one. Yet, if there is a huge difference of about $1000 in the fees, this calls for deeper digging. Finally, play close attention to the most important factor- Training Quality. The driving time, job placement guarantee, instructor experience should all be closely studied and compared with that of other schools.

Also, you should ask about the number of students handled by each instructor as this is bound to impact the training quality. Take the time out to tour the facility and talk to the students and the instructors and even observe live training sessions if possible. All of this will give you maximum value for your investment and make it easier to find employment after completing the truck driver training program.

image by Scania Group

Do You Know about These New Surety Bond Requirements for Freight Brokers?

It used to be that the surety bond required for freight brokers was at $10,000. Soon, it’ll be $75,000, thanks to legislation signed by the President in July of last year and which will take effect in July of 2013.

The new business cost drew some howls from small freight brokerages, but since there’s some months yet before the law takes effect, you may want to know what the updated surety bond requirement would mean for your business.

History of the Freight Broker Surety Bond

The bond requirement that freight brokers have to comply with to obtain their license came about as early as the 30s. Back then, it was designed to protect shippers from unscrupulous brokers. In the 80s, judicial action extended that protection to carriers to ensure that freight brokers paid the truckers for services rendered.

Many decades later, around 2004, there was a petition from a major trucking association to further increase the bond set in the 70s at $10,000 to as much as $500,000. They argued that the current surety bond amount is insufficient to cover their losses when their trucks aren’t paid by fly-by-night freight brokers—the rates have to account for inflation, too.

One counter argument after another shelved the proposal, until three big industry associations usually at odds with one  another—the Owner Operators Independent Drivers Association (OOIDA), the American Trucking Association (ATA) and the Transportation Intermediaries Association (TIA)—were able to iron out an agreement for the increase. Their lobbying in Congress yielded fruit when the bill increasing the surety bond passed.

There’s some comfort to what some legal experts are saying. The law on the new freight broker surety bond may actually take effect several months more after July 2013.

The regulation will still undergo public comment, re-evaluation and rewriting (based on the comments submitted) before freight brokers will actually shell out the necessary expense. And then there might be legal challenges to the new law, setting back its implementation to a few months more. Industry insiders are saying the new surety bond may take effect in 2014 or even in 2015. Freight brokers will be given enough time to raise the funds to comply with the new regulations.

How the New Surety Bond Will Affect Freight Brokers

Again, the increase in the surety bond requirement is supposed to protect shippers and carriers from shady freight brokers. The higher rates are designed to weed out fraud in the industry and keep motor carriers from taking on losses when freight brokers fail to pay them.

Some small freight brokerages though are accusing the big brokerages behind TIA—a professional association of freight brokers—that they’re trying to eliminate competition from small operations (the ‘mom and pop’ variety).

They may not be far off, given the possible consequences for smaller freight brokerages are once the rate increase on surety bonds goes in full force:

  1. Mergers between freight brokers. It’s the best solution—when two freight brokerages combine their economic power in order to afford new rates. This could yield to a stronger, better business and partnership because both will bring a solid base of loyal shippers and carriers to the table.
  2. Sale of freight brokerages to more liquid brokers. Some brokerages may get lucky. Since they’ve built enough reputation and goodwill for their brand, not to mention a steady base of customers, they could get other brokerages—existing or new brokers—to purchase their business. At least, they’ll exit with enough finances to show for their years of hard work.
  3. Business closures. Indeed, $75,000 is a big outlay that small businesses won’t absorb easily. Although the higher surety bond rate will edge out unscrupulous freight brokers it’ll also negatively impact reputable but smaller property brokers who can’t afford the new rates given today’s economic climate.
  4. Stiffer requirements for obtaining surety bonds. Experts are saying that underwriters will hesitate to take on a $75,000-bond more than ever. (They’re already cautious on the $10,000 bond.) To compensate, they might ask freight brokers to match it with liquid assets comparable to or even more than the amount of the new bond rate.
  5. Changes in hauling rates. The country’s economic prospects are picking up but not enough to cushion the impact of increasing rates. The freight broker may have to distribute the added expense across loads. Otherwise, they’ll have to take in more loads to absorb the costs so as not to turn off customers if they have to increase service rates. Somewhere somehow, there are additional risks and tradeoffs to this possibility but until the rates are in effect, we’ll never know what they are.

Actually, other freight brokers welcome the rate increase, particularly because there’ll be fewer competition in the market. Plus, there’ll be additional barriers to entry into the freight brokerage business. To date, there are about 20,300 property brokers with surety bonds in the country. With the rate hike, this figure could dive considerably, resulting in more business for surviving freight brokerages.

What we haven’t factored into all these though is the resiliency of small business owners. We make up the backbone of the American economy. We’ve gone through many challenges and survived many of them. Unlike “mega” brokerages, “micro” freight brokers can survive on up to 10 steady, profitable customers so there’s a huge likelihood that we’ll weather this surety bond rate hike, too. After all, every business suffers setbacks once in a while but no business owner worth their salt has ever backed down from any problems or challenges yet.

Here’s Why You Absolutely Must Choose A Great Name for Your Freight Broker Business

Do you want to know one absolute essential piece of your marketing plan that you absolutely must nail? Choosing a name for your freight brokerage business.

You thought you could just go with Joe Smith’s Brokerage and that would be fine? Or you haven’t really given your naming strategy much thought? That’s okay – and from the looks of things it’s not uncommon either.

However, we’re talking about building a business with excellence as a core principle and any business that takes themselves seriously is going to take marketing and branding seriously.

Take Your Marketing and Branding Seriously and You will Reap the Rewards

Taking your marketing seriously means that you take the time and effort to build a great name for your business – one that you can build in to a brand that represents the strength of your organization.

Choosing your business name ranks up there in importance to creating a viable freight broker business plan—the right business name can get your foot right into the door…and the wrong one can consign your freight brokerage to obscurity.

Naming your business can be plenty stressful, too. It’s about this time when many entrepreneurs start wringing their hands, confused and frustrated, and not sure how to proceed. That’s because a good business name must not only tell your target audience what your business is exactly but why they should choose your freight broker services above the rest.

But dont’ fret! There is a solution and working through a few simple steps will help clarify things for you and help you on your way to building a fantastic brand for your freight broker business.

The Qualities of a Good Freight Broker Business Name

Stressful as the process may be, there’s a way to take away the pain from the naming game…like keeping in mind the following aspects of a top-notch business name before you sit down and start brainstorming for an unforgettable one.

  1. It must have value. What will the name evoke when the customer hears the name of your freight broker business for the first time? What kind of image will it convey? Will it express a fun personality or a staid demeanor?
  2. It must be unique. Think branding and trademark. Certainly, you don’t want to sport a copycat name that echoes an industry leader’s branding rather than yours. Besides the iffy legalities of piggybacking on another freight broker’s brand, it tells your potential customers that you don’t have the creativity they need to handle their business, much less have the kind of distinction to your services that’ll make you stand out from your competition.
  3. It must be memorable. How will your business name appear in your logos, on the web, or anywhere you’re going to place your brand on? Is it simple enough to remember or is it too complicated that it’s much simpler to forget it? Take care though that it’s not too simple that it’s become generic…and forgettable.
  4. It must be internet ready. Although a website might be too early to think about while you’re still organizing your business, getting a business name that can also act as your domain name will make it easier for your customers to find you on the web.
  5. It must convey credibility. It’s easy to go for the business name that’ll make your freight brokerage stand out. But you don’t want to stick out too much among the rest that you’re sacrificing integrity and reliability—two of the important characteristics that customers look for in a trustworthy freight broker.

It’s important that you outline the characteristics and connotations that you want to associate with your business name. The process is vital because if you want to outsource the business name generation to a naming firm, it’ll be easier to communicate what you want—you’ll have a starting point they can work on.

Once you’ve got your preferences defined, it’s time to hunker down and work on coming up with a unique, valuable, memorable brand for your freight broker business.

How to Choose a Business Name for Freight Brokers

So now, you’re ready to pick a name for your business. What’s it going to be? Whatever name you come up with, it’s going to stick with you for a very long time so choose with care.

Here’s how to generate a business name:

  1. Walk in your customer’s shoes and brainstorm ideas. What do you want your market to think about when they hear the name of your freight brokerage? Staid and steady? Reliable with a fun side? Or creative and innovative? List down all the characteristics that you want them to associate with your business. See if there’s a common thread among particular words you’ve come up with and sort them into related groups.
  2. Branch out to related meanings. Consider each word group and continue adding nouns, words and phrases that are connected to your original word list. Bring out the dictionary, thesaurus, and if possible, a list of Latin and Greek roots, suffixes, prefixes and phrases—they could come in handy.
  3. Mix and match. Play around with word combinations. Create a new word if you must, merging roots, suffixes and prefixes, and even words and concepts from two different languages. Keep at it until you come up with a list of 10 possible business names for your freight brokerage. While you’re mixing and matching words, keep in mind your branding—what you want to convey to your market. And please, stick to short words that you can pronounce easily.
  4. Discuss with trusted associates. Your top 10 list isn’t the end of the name game yet. You need the fresh perspective of somebody else who can tell you what this list of names tells them at first blush—if they communicate value, are memorable or unique. Ask the opinion of one or more people whom you know have your best interests at heart so as to receive honest assessments. Afterwards, whittle down your list. Cross out the names that don’t suit the image and value that you’re trying to establish.
  5. Research for uniqueness. This one’s tedious work but you need to make sure that the business name you’re thinking of using isn’t being used by another outfit. Google the name, visit local business resources and authorities, and check against existing trademarks to make sure you’re not treading on someone else’s branding. By making sure that the business name you’ve chosen is one of a kind, you not only avoid legal trouble down the road, you’re also making a claim on a unique and potentially memorable business name for your freight brokerage.

So let’s say you’ve brainstormed, considered and researched thoroughly and you now have a business name to go with your freight broker business. The last thing to do is to file the appropriate papers—incorporation papers, trademarks or service marks—to make the name your own.

In the United States, once you associate your business name with your services, getting the trademark is automatic. The only reason why you’d want to make a state or federal filing is if you want your rights applicable across geographical boundaries. Should there be any legal problems down the line, your rights may only apply to the particular localities and not across the nation if you don’t secure your business name this way.

Like it or not though, a business name is one of your must-haves in creating an identity and a branding that distinguishes you from other freight brokers. By following this advice, you won’t have to rely on a hit-and-miss system when choosing a name for your freight brokerage. Plus, you get to avoid the pitfalls of a truly horrendous, downright bland name.

image by faroekat

An Invitation to Write for Freight Broker Training Headquarters

Are you a broker, a broker agent, or own your own freight brokerage firm and love talking about the business? We would love to hear from you and publish your content here at Freight Broker Training Headquarters!

Currently, it’s not a paid gig, but if you are in the business posting here can be a great boost to your own website and we’d love to have you share your content with our readers!

We’re looking for first time contributors as well as experienced writers/content creators  that can become a consistent presence here at


Generally anything that is useful for our readers is good content for a guest post here. It can be related to how to market your services, general info on transportation and logistics services, or your own personal experiences.

Here are some specifics of what we’re looking for:

  • Freight Broker How-To’s
  • Freight Brokerage Business info
  • Logistics News & Industry info
  • Freight Broker Training Tips & Tools

The Process

We want to make it easy as possible for you to contribute! All you need to do is fill out the form below to get started. In the comments, let us know what you’re writing about and we may talk a bit so that the post and topic clear and match up with what we’re doing here, but rest assured – we’re super easy to work with!

If your post idea is accepted for publishing you’ll get a username and password to log in here to draft your post. We’ll go over it and give you feedback as necessary and then once everything is ready to we’ll publish it. It’s important to fill out your profile once you’re logged in so that your credit for the post is awesome.


  1. Your post must be original and not previously published either on the Web or in print.
  2. You agree not to publish it anywhere else, including your own blog or Web site. You may, however, post a brief “tease” or summary on your site that links to the post.
  3. You may provide up to three byline links: one for your blog or Web site, one for your bio or About page, and one for your Twitter username (optional).
  4. Your post should be at least 500 words long, but we don’t mind if they’re long. In fact, we prefer longer posts to shorter ones!
  5. Practical examples are important. After reading your post, readers should have not only gained new insights and ideas about the industry, but learned how to actually implement these insights and ideas in practice.
  6. We will publish your bio that you submit in the profile section of WordPress so make it awesome!


As we review your submission, it’s likely that we’ll edit for proper grammar, punctuation, etc. We will also provide a short introduction to your post that frames up why we think your contribution is valuable to the discussion regarding the freight broker training and larger transportation and logistics world.

Your Name (required)

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Your Message

7 Mission Statement Mistakes That Can Spell Doom for Freight Brokers

The mission statement is the first, crucial part of a freight broker’s business plan. It identifies the goals of your freight brokerage, the specifics of how to achieve these objectives, and the principles that will guide your business in achieving its goals.

The problem is, too many businesses don’t find value in their mission statements. It only exists for compliance’s sake, a bunch of words that get consigned to oblivion once they’ve satisfied officialdom. The power behind mission statements isn’t harnessed. Instead of giving enterprises a laser focus on what they do, clarifying everything—it becomes a useless tool.

Mission statements are very powerful things but to keep them relevant and useful, you’ll have to craft one the right way…and then use it. The only way to know if you’re writing your business intent right is to know the mistakes that other companies have made. Here are some:

Employees and partners did not contribute to the mission statement.

The relevant stakeholders in your business were left out when your freight brokerage’s mission statement was being written. Either you outsourced the crafting or sat down one lazy afternoon and whipped out something that you think your business is all about. Whatever you did, you missed out on valuable inputs when you chose to ignore the opinions of those who had the experiences, knowledge, or background to contribute to and clarify your business focus.

Although you started and own the brokerage, collaborating with your freight agents or partners lends a broader perspective to your mission statement. At the same time, they can identify what elements should be included or modified to keep your mission statement laser focused.

Specific and desired outcomes are undefined.

While mission statements are dynamic declarations of intent, this should not stop you from drilling down to the specifics of your enterprise goals. Identifying what you want to achieve is a basic element, but when deciding on desired outcomes, keep an eye out for whether you want these goals to be for the long or short term.  If your goal is achievable within, say, five years then you can be as granular as possible in your language. If you’re thinking of further expansion in the future, then let your language accommodate this expectation.

Whether the goals are achievable within two years or 10, mission statements are meant to be updated so that they remain relevant to your business. Set a schedule for when to review your business goals with your freight agents and partners and adjust them according to present and anticipated realities in your space.

What you want to do is improbable, incredible and unlikely.

Tread carefully when defining your desired outcomes. While mission statements must straddle a good balance between realism and optimism, it’s possible to stray into improbable territory. You might be laying down business goals that you have no way of attaining…which is why input from the parties that are involved in achieving your objectives are important. They keep you grounded on what’s doable and at the same time point the way to what’s achievable.

Language used is meaningless, vague and uninspiring.

The best way to capture your audience’s attention—whether it’s a customer, employee, supplier or industry partner—is to create a memorable image in their minds. Use concrete visual triggers rather than abstract concepts in your language when you’re drafting your mission statement. Creative writers would say, “Show, don’t tell.” As a freight broker, what are the images that come to mind when considering your industry? Choose images—like roads, trucks, loads, clocks, and so on—that your audience regularly encounters to create powerful triggers in their minds. Or, you can zero in on a key theme inspired by your desired outcomes to create a picture in your mind and include what you see in your statement.

Here’s the mission statement of Otis Elevators which is an excellent example of what we’re talking about:

“To provide any customer a means of moving people and things up, down and sideways over short distances with higher reliability than any enterprise in the world.”

 There’s no compelling story at the heart of your mission statement.

By story, we don’t mean creative fiction. The story that’s relevant to your audience is the satisfactory resolution of a painful problem. You’re in business because there’s a problem that you’re good at solving. For example, as a freight broker, you take care of getting a shipper’s load from Point A to Point B—safely, on time and cost-efficiently—by arranging deliveries with reputable trucking firms. Right then and there, you’ve lit in on your client’s emotional hot button—the secure, timely, and cheap transport of their precious assets.

Also, provide differentiation from your competitors. Who do you serve best? What is it that you do best that the other freight brokerage firms can’t do? Include these types of stories in your mission statement to create unique branding for your company in your mission statement.

The mission statement targets a very broad audience.

Do you know who your customers are? Do you have a particular niche that you service? What do you do best as a freight broker? What is the nature of your brokerage services? When you have the answers to these questions down pat, you’ll narrow in on your target audience (or market), and be able to create compelling messages to connect with them in a meaningful way.

Your mission statement is a long essay.

If your business intent is too long winded, using highfalutin words that only people with several initials after their name can understand, then might as well ditch the effort of crafting a useful mission statement. With your mission statement, aim for short and sweet, about one to two sentences (not paragraphs). If it’s possible to use your mission statement as your slogan or tagline at the same time, then all the better. It becomes a mantra that’ll motivate you, your employees and partners for those times when the going gets tough.

There’s a lot you can do wrong when you’re trying to tell the world why your freight brokerage exists. The mission statement isn’t only a declaration of intent, it’s also your primary branding tool—it helps separate your freight broker services from the rest of the pack. By doing it right, it will keep you focused and grounded on why you’re in the freight brokerage business in the first place.

image by ImNewHere

Why Are We Here?

A question that comes across our desk from time to time, is why did you decide to start this site? It’s simple, really.

This site is built to be a resource for those who are trying to make their way through life and start a life of independence. All you have to do is turn on the news and it’s all economic doom and gloom all the time.

But we’re of the opinion that there is plenty of opportunity for people who are resourceful enough to roll up their sleeves, do the hard work, and make things happen. This site just happens to focus on the people in that group that are interested in working in the transportation industry.

Freight brokers are hard-working people and there is good money to be made as a broker. We’ve seen it ourselves from our experience in transportation – hard work is rewarded by the people who know their stuff, and are willing to dig in and make things happen.

As we get this site moving and growing, we’re covering a lot of basics. But we can already see there is so much opportunity for growing and covering other areas of logistics and brokerage.

We want to introduce those who have no experience in the industry to what it’s really like. We want to show them what’s involved in finding work, becoming a broker agent, becoming a broker, starting your own brokerage, what’s the life of a broker like, etc.

We don’t have the answers, but what we do have is a desire to produce outstanding, relevant and easy-to-use information that will help aspiring brokers on the way. We are dedicated to top-notch research, finding answers to the questions you have.

Do you have a subject that you would like for us to cover? Just let us know in the comments below.

How to Build Your Freight Broker Business Plan

When you get into the freight broker business, failing to plan is planning to fail. Whether or not freight broker training school will teach you how to craft your own, the most important thing you can do before hanging your business sign out the door is to prepare a business plan.

Why should freight brokers bother with a business plan? After all, brokering is just a matter of finding shippers and carriers and matching up the two, right? In a manner of speaking, yes, but if you want to succeed at it, you’ll have to plan for it.

A good freight broker business plan will help you determine if setting up your own brokerage is a viable idea or not. It gives you a detailed view of the opportunities and risks that come with operating a property brokerage firm.

Also, with a good business plan, you break down management into bite-sized, doable pieces. It goes without saying that the investors and bank managers you’re approaching for a loan/investment will need to see one, too. They’d want to know if they’ll get a return on their investment and when.

Use the following business plan template that’s tailored for freight brokers

The Freight Broker Business Plan

A. Executive Summary

This section of the freight broker business plan is the last part you’ll ever write. It sketches a bird’s eye view of what your company is all about—what you do, why, and how you’ll achieve success. It’s usually two pages long and contains a summary of all the points covered in detail in the following sections.

But don’t let its short length fool you. Most of the time, it’s the make or break portion of your presentation when you’re looking for investors or applying for a loan. It’s usually what busy executives scan first. Their decision to invest could depend on the strength of the Executive Summary.

B. Business Description and Vision

Starting with this section, you get into the details of your freight brokerage business. Here, anyone reading the plan will get a firm grasp of what the business is all about and what it represents. Your insights on the company’s growth and potential also goes here.


  1. Mission Statement
  2. Company Vision
  3. Business Goals and Objectives
  4. A Brief History of the Business
  5. List of Key Company Principals

C. Definition of the Market

Defining your market is perhaps one of the more important parts of the freight broker business plan you’ll have to deal with. It involves deciding on your market niche, getting to know your customers, and the potential reach of your freight brokerage so take your time.

Some of the questions you will need to answer include:

  • What is the industry you operate in and its prospects?
  • What is the scope of your freight brokerage business and what is the potential market share for it?
  • What are the market segments you’ll be targeting?
  • What are the customer needs and problems that you’ll be addressing?
  • Who are your target customers?
  • Who are your main competitors?


  1. Business Industry and Outlook
  2. Critical Needs of Perceived or Existing Market
  3. Target Market
  4. Customer Persona
  5. Market Share
  6. Competitive Intelligence
  7. Main Competitor Profiles

D.    Description of Services

Freight brokering is basically a service-oriented business and there are many ways you can differentiate yours from the rest of the competition. After reading this part, your potential investor should have a firm understanding of why you’re in this business, the range of services you’ll offer, and your competitive edge.


  1. Description of Services
  2. Pricing Strategy
  3. Competitive Edge

E.    Strategic Direction

This is where you do the SWOT analysis. You study your freight brokerage firm’s strengths, weaknesses, opportunities and threats in the context of the market your targeting, the industry you’re moving in, and the bigger economy in general. It may also include new service segments you’ll be offering in the future (say, in five years’ time) and business goals that you’d like to tackle down the line (for example, turning the business into a franchise).

Some would include this section in either market assessment or in products and services, but others choose to separate it as it allows them to drill down on the freight brokerage’s success factors.


  1. Strengths of the Freight Brokerage Firm
  2. Weaknesses
  3. Opportunities in the Marketplace
  4. Threats
  5. New Services
  6. Future Business Goals/Objectives

F. Marketing and Sales Strategy

This section of the freight broker business plan discusses the ways and means to promote and grow your business. Describe the forms of marketing you’ll use—advertising, web strategy, sales plans, promotions, public relations efforts, and the like. More importantly, get into detail on who your market is, how you’ll reach it, and how you’ll sell your services competitively.

There’s also a subsection on forming strategic alliances—the people and companies you’ll be working with to find new and serve old customers. Describe also your networking efforts—how, when and where.


  1. Market Description
  2. Service Demand
  3. Marketing Strategy
  4. Promotions Strategy
  5. Sales Strategy
  6. Web and Internet Marketing Strategy
  7. Strategic Alliances

G. Organization and Management

Your freight brokerage firm will need to define work flows, record keeping, billing and accounting…basically the operational flow of your business. Outline business routines as well as the legalities of your business. Name the leaders and their responsibilities and roles.


  1. Form of Ownership
  2. Management Team and Roles
  3. Organizational Structure
  4. Personnel Plan, including freight agents
  5. Legal Process Agents and States of Operation
  6. Corporate Legal Representative

H. Financial Management

This is the numbers-crunching part of every freight broker business plan…and the least liked by most. However, this is one of the chief areas that potential investors and bank loan managers will be looking at closely. They’ll want to see your freight brokerage firm’s financial viability and the bottom line projections.

If you’re just starting your business, show an estimate of your start up costs, and the projected figures for the next year’s operations using the following: balance sheet, income statement and cash flow statement.

If your brokering firm’s been around for a while and you’re looking for new investors or a bank loan, highlight the following reports from your last three years of operations: balance sheets and income statements. You’ll also need to provide a cash flow statement. Bank loan managers would also want to have a copy of the personal financial statements of your firm’s leaders and your tax forms for the previous year.

Subheadings (where it applies):

  1. Start Up Costs
  2. Projected/Current Balance Sheet
  3. Projected/Current Income Statement
  4. Projected/Current Cash Flow Statement
  5. Personal Financial Statements of Business Principals
  6. Federal Tax Returns for Previous Year

As you can see, if you spend time preparing a business plan for your freight brokerage firm, you end up using rational thought and discipline in managing your business.

But this freight brokers’ business plan shouldn’t end at the writing of it. A good, viable business plan is a dynamic document that you should revisit, review and routinely update to reflect emerging trends and opportunities, current economic realities, and growth factors. Should you choose to get additional freight broker training, you’ll be taught how to spot these new changes in the marketplace and incorporate it in your freight broker business plan.


Co-Brokering and Double Brokering: The Boon and Bane of Freight Brokers

One of the most controversial issues that you’ll get to know more thoroughly in freight broker training school is double brokering—a grey area where freight brokers, motor carriers and shippers have conflicting stances.

A shipper trusts the broker to find a trustworthy carrier to deliver their cargo to the consignee safely and promptly but how the other players accomplish this at the root of the disagreements.

Double Brokering and Co-Brokering: Definitions

Co-brokering, according to most industry experts, is the legal option of the two practices. In this setting, a licensed property broker agrees to move a load for a shipper and asks another licensed freight broker’s help in finding transportation for the cargo. Co-brokering usually happens when the second broker has the expertise and experience that the original broker doesn’t have in moving the load.

It’s a matter of not turning away a business opportunity when there are resources available to move that load, just not strictly by your own brokering outfit. This arrangement is possible as long as the first broker’s contract with the shipper does not specifically forbid co-brokering.

Double brokering, on the other hand, is the practice that’s fraught with risks. Here, the freight broker and the motor carrier agree to move a load…and then the trucker promptly brokers the load to another carrier to transport without (or even with) the original broker’s consent or knowledge. The original carrier may pass on the load as a trucker or through its own brokerage firm. The chain of custody becomes murky and the shipper and consignee may be left holding an empty bag once the smoke clears.

When the freight broker is unaware of its motor carrier’s actions, several things are happening at once:

  1. It’s unclear who’s handling the freight;
  2. The second motor carrier may not have the appropriate license to move the load;
  3. The actual carrier may not have the financial coverage to cover the liability if things go wrong;
  4. The original carrier may not have done a thorough due diligence check on the actual carrier; and
  5. It becomes difficult finding out who’s accountable for the cargo—the freight broker, the original motor carrier or the actual carrier who delivered the load.

The Risks of Double Brokering for Freight Brokers

In co-brokering, all the parties are aware, in writing, of their responsibilities with regards to each other, to the shipper and to the shipment. Ascribing liability when things go wrong, even in legal proceedings, is more or less straightforward.

As you can see above, following the chain of custody for the shipment becomes tricky in doubly brokered shipments. Ideally, when a double brokering occurs, the party who obtained the services of the second carrier should be the one accountable for the actions of its mover(s). If the freight broker was careful in doing background checks on the carrier but still didn’t catch the double brokering, then s/he may be protected from damages.

It isn’t the same though if the freight broker was aware of the carrier’s frequent double brokering practice and still ignored it. This assumes that (1) the broker knew of the substitution and didn’t evaluate the second carrier’s safety and reliability record or even, (2) the broker didn’t know which carrier has the actual custody of the load. When this happens, the freight broker can be charged with irresponsibility and become liable for damages borne by the shipper when something bad happens to the freight.

Another risk worth mentioning is the fact that the original carrier who passed on the shipment may not pay the actual carrier for moving the load. In this instance, you as the freight broker may end up paying twice—the original carrier and the actual carrier—for the service.

Protecting Yourself with Due Diligence

When a freight broker agrees to be responsible for a shipment, the shipper assumes that the broker has conducted due diligence in sourcing his/her carrier and that they have the integrity to get that load delivered.

With the perils inherent in double brokering, freight brokers have to exercise prudence and caution when arranging transport for the shipments they’re responsible for to make sure the shipper’s assets are safe.

Note though that co-brokering is not without its vulnerabilities. Some freight brokers ended up working with fly-by-night brokers whose bait-and-switch modus operandi left respectable brokerage firms high and dry. They hype up their services, enter into co-brokering agreements, pass off the load to another carrier and when they get paid, they disappear off the face of the earth without paying their carriers. The original broker ends up paying and if it’s a small operation, they could end up seriously hobbled with major losses.

Due diligence—making sure you investigate the other party’s background, experience and capabilities thoroughly—can go a long way to ensuring you’re protected from liabilities. Here are some ways to do it:

  1. Double-check safety ratings, registration, safety scores, FMCSA inspections, and insurance filings before entering into a contract of carriage.
  2. Conduct credit checks to make sure the carrier can guarantee the liability.
  3. Ask for and follow up references given.
  4. Be clear in defining obligations and responsibilities in co-brokering agreements.
  5. Include a clause against unauthorized double brokering and the penalties associated with it in the contract of carriage.
  6. Make sure that carriers are moving loads under their own authority and that you have access to their records to prove it.
  7. Maintain direct communication with the drivers while the load is in transit.

Once you accept responsibility for a load, you’re liable for what your agents (and their agents) do and fail to do. A freight broker’s business viability is dependent on keeping your shippers’ trust and confidence. Once broken—and frequently—it’s a matter of time before you’re shuttering your freight brokerage business altogether. And that is something that you don’t need to go to freight broker training school to know.

What Every Freight Broker Needs to Know About the Transportation Industry

Freight brokers live under the enormous umbrella that is the transportation industry. Everything that carries people and goods from one port to another is part of this sector – buses, trucks, boats, airplanes, rails, cars and everything else in between.

The industry is so huge that in 2011 alone, it was worth about $1.82 trillion, roughly representing about 10% of the US’ economic activity. In the same year, close to 4.3 million people accounted for truck transport services that amounted to $200 billion and exports that reached $1.48 trillion.

Practically everything around you – the clothes on your back, the books you’re reading, the computer on your work desk, the supplies in your office, to name a few – came from somewhere. And all these stuff came to you in one of several ways: by land, sea, or air transport, delivered not just by the truck driver or the mailman but also by the dispatchers, pilots, train engineers, and a host of other back-of-the-house logistics personnel who planned, coordinated and tracked the routes that these packages travelled to get to you.

Freight Brokers and Other Industry Players

Freight brokers belong to the broad logistics sector which ensures that people and goods leave on time from a point of origin and arrive on time to a point of destination. Work could range anywhere from scheduling pick-ups and deliveries, mapping cost-efficient routes, tracking movements, through to troubleshooting problems en route. The end goal is to limit the amount of time products and people stay in one place that’s not yet journey’s end.

The trucking industry, which is the biggest concern of freight brokers, carries 80% of all consumer goods from shippers to consignees in America. Within this sector, there are several players that the freight broker must be aware of:

  • Shippers are your customers – they’re the ones who have products that need moving.
  • Consignees are the receivers of the loads, the final destinations so to speak of these products being moved.
  • Motor carriers are the companies that supply the trucking to move these products. They can either be private – they move their own cargo; or for hire – they get paid to move cargo belonging to other companies.
  • Freight forwarders. As we have discussed in a previous post, freight forwarders are similar to freight brokers. Only, they handle loads bound for international shipment, not domestic destinations. Sometimes, freight brokers need to work with them when a load that moved from point A to point B locally needs to be shipped internationally.
  • Dispatchers are employed by trucking companies to manage drivers and their loads. They decide which load goes to which driver, arrange and coordinate drivers’ schedules, and help drivers toe DOT regulations. Often, dispatchers link up with freight brokers to see if there are available loads that match their drivers’ routes.
  • 3PL (third party logistics) can be likened to a one-stop shop. 3PLs are companies that can provide a host of services all at once to their customers: warehousing, order fulfillment, customs, inbound and outbound freight, and distribution.

The Freight Broker’s Regular Routine

At the heart of the freight broker’s job is the freight – the load, shipment or cargo that needs to go somewhere domestically. These are goods produced in the US or abroad that are delivered to a domestic address. Whatever it is, a load will always have a shipper and a consignee.

Your work as a freight broker starts by soliciting business from shippers. Ideally, you should already have a solid database of shippers to call for loads. If they’ve already worked with you in the past and found your service punctual and reliable, they’ll likely offer their cargo. Rates vary depending on the kind of freight to be handled so you’ll be negotiating terms with the shipper.

Once you agree on the figures and accept responsibility for the load, your next order of business is to find a truck that wants the cargo. Again, you’ll negotiate freight rates with the carrier. This time though, you’ll be selling the load to the trucker at a much lower rate – enough to cover your expenses and provide you a fair profit, but also factoring into the equation a fair return for the carrier.

As soon as you and the carrier concur on the terms, you’ll exchange setup packets – information containing each others’ operating authority (MC number), surety bond, W9s (request for taxpayer identification and certification) and references. At this point, you’ll need to draw up a contract between you and the carrier. The contract, among other things, will help to protect your business. If you’re not careful, the carrier could go directly to the customer and offer their services, cutting you out in the process. The best way to avoid this is by exercising prudence: don’t give away too many details about your customer.

Once they have signed and returned this contract to you, you have to fax the carrier a rate confirmation for their signature. When they send it back, your load is now officially covered and off for delivery. The next phase of your job is to ensure that the load gets to the consignee promptly. Your reputation as a reliable freight broker, and the future of your business, depends on it.

Freight Brokers, Freight Agents, and Freight Forwarders: What’s the Difference?

The very first thing you’ll learn in freight broker training school is distinguishing between the different players in the logistics and transportation industry. Some of the major players include freight brokers, freight agents and freight forwarders.

At first, all three may look and sound the same. After all, they do almost the same thing, have the same freight training, know all there is to know about brokering, and have been trained by people who have the same experience and knowledge in the industry. But when they hunker down to work, there are noteworthy differences in what they do.

Freight Brokers

Teachers in freight broker training schools worth their salt will tell you that there’s a definite distinction between the freight broker and the freight agent.

The freight broker runs the brokerage firm. For starters, s/he must have a property broker’s authority from the Federal Motor Carrier Safety Administration (FMCSA), carry a $10,000 surety bond, and have designated agents in the states they’ll be operating in for legal claims purposes.

Freight brokers can be self-employed full time and work from home. Having the profits from brokering arrangements between shippers and truckers all to yourself doesn’t hurt either.

But freight brokers must divide their time between running an entire business and the all-important, enterprise-boosting activity of finding new shippers and carriers. They have to think about cash flow, billing and collection, marketing, networking, and all the “backroom” grunt work that goes into running a going concern. At the end of the day, they may not have the time to do the important things that need to be done to increase revenues.

And this is where freight agents come in handy.

Freight Agents

Many fresh graduates from freight broker training schools sometimes start their brokering career as freight agents. Being a freight agent allows them to hit the ground running, recoup their training investments quickly, and at the same time, get the knowledge that only a hands-on exposure to freight brokering can give.

Why start as a freight agent straight out of freight broker training school? For the main reason that freight agents (or freight broker agents) do not need the authority, surety bonds and insurances that come with a full freight brokerage business.

As a freight agent, you work under a freight broker so there’s no heavy financial pressure to give your career start a hiccup. You can jumpstart your earning potential quickly with just a computer, fax and phone line, and internet access right from a home office. That’s a very low-cost start-up indeed.

Your main responsibility is getting new customers and drivers. You’ll spend most of your time marketing your freight brokerage services, networking to find shippers and carriers, doing reference or background checks on them, making sure that your loads get to where they should go on time, and troubleshooting load problems, to name a few. In short, you’re more into the operational side of freight brokering rather than on the strategic management side.

The upside to this arrangement is that you won’t need to worry about invoicing, billing, collections, cash flow, payroll and all that jazz that goes into directing a brokering company. Your freight broker takes care of that entire headache. Your business is getting more business, period.

The downside to this arrangement is that you’ll have to share your earnings from commissions with your freight broker.

Freight Forwarders

To the freight broker training school freshman, the freight forwarder and the freight broker is often interchangeable. That’s easy to understand since to a layman there’s somewhat of a similarity to what they do. But to old hands in the freight industry, there’s a considerable distinction between the two.

While freight brokers typically move loads from shippers to carriers without even seeing the freight they’re moving, freight forwarders directly handle the goods that must be transported to different destinations. Most importantly, they transport cargoes and shipment internationally.

To ship loads overseas, freight forwarders have to receive smaller cargoes and combine these into one big shipment. That means they’ll have to possess the goods physically, consolidate them (often according to a single destination), and then decide on what method of shipping they’ll use—whether they’ll move the cargo by land, air or water.

For a freight forwarder, moving cargoes and shipment internationally means additional knowledge and experience beyond being a domestic freight broker. You’ll need to have a solid grounding in customs—laws, procedures and practices, and have experience in vessel requirements and loading. Fluency in one or two foreign languages won’t hurt either.

There are many more players in a freight brokering industry. For now, if you’re following your own curriculum, it’s best to know the difference between freight forwarders, freight agents and freight brokers so you’ll have a good grounding while you progress in your self-paced freight broker training.