Freight Broker Training
What are the requirements to become a freight broker?
Freight brokers conduct a vital, complex and high stakes job which is central to the proper functioning of the shipping industry. Because of the degree of responsibility that freight brokers must hold, freight brokers are regulated in their work by the federal government. This means that there are three legal requirements you, as an aspiring broker, must meet before you can become a licensed freight broker.
The first is that you must obtain a Freight Broker Authority. This is granted to successful applicants by the Federal Motor Carrier Safety Administration (FMCSA). You must start by filling out the OP-1 form on the FMCSA website. In this process, you will be required to provide information such as your business name, contact information and a USDOT number. Beginning this application will give you access to a Motor Carrier (MC) number, which you must use to meet your second legal requirement.
The second legal requirement is that you must obtain a Freight Broker Surety Bond. Once you have your MC number, you may apply for a Surety Bond, and will not be granted a freight broker license until you can prove that you have been bonded. This bond acts as a financial guarantee to protect carriers in the event of shippers defaulting on a payment. This bond will allow you to submit your BMC-84 form, which is an essential stage to gain your Freight Broker Authority.
The third requirement is proof that you have Legal Process Agents in the states in which you wish to operate. These agents are legal representatives who will represent you in states in which you wish to operate, other than that in which your business is based. Depending on the number of states in which you wish to operate, you may either hire individuals, or a legal firm with branches established in your operative states. Once you have hired these representatives, you may include their details in the BOC-3 form of your application.
Once you have submitted all of the relevant forms to the FMCSA, and you have paid your fees to them, your authority should be granted to you within four to six weeks.
How much does it cost to become a freight broker?
There are a range of costs associated with becoming a freight broker, several of which are one-time payments required to get started, and others which you are likely to pay monthly.
The Freight Broker Boot Camp suggests that becoming a freight broker costs between $2,000 and $5,000 for your initial setup, and incurs between $200 and $400 of monthly recurring costs. The link above offers a detailed break-down of these costs. However, in summary, they are made up of:
- $100-$400 for establishing an LLC
- $300 for your Broker Authority
- $25 for your BOC-3 form
- $1,500-$3,750 surety bond cost, based on the assumption of a 2%-5% rate on a $75,000 surety bond
- $185 for training, though these prices can be as high as $5,000
- $50-$100 per month for Transport Management Software
- $50-$150 per month for access to a Load Board
- $300-$1000 per year for General Liability Insurance
- $100-400 per month for Contingent Cargo Insurance
- $59 per year for Unified Carrier Registration
- $250 to $500 to establish your website
- $20-$50 per month for your phone
Freight broker training resources
Freight broker training is not a legal necessity in the U.S. However, it is highly advised, as it can make an otherwise difficult initiation process far faster and easier.
Freight broker training schools
There are a number of excellent training schools and centers for freight brokers in the U.S. Included amongst these are:
Transport Training International
The Transport Training International School combines proficiency with flexibility. They offer a range of courses designed to help beginners get started as freight brokers at their centers in Georgia and Dallas, as well as online. Their 5-day course offers students the basics of freight brokering, practical guidance, as well as the additional opportunity to undertake a placement with a freight brokerage firm after graduation. Their classes cost $2,250, with a discount available for students who have already undertaken broker training at another school.
Brooke Transport Training Solutions
Brooke Transport Training Solutions offer specialist classes in Texas, California and North Carolina, which make up a 5-day course for $2495. Their course guides students through the practical stages of growing a startup brokerage, whilst also offering guidance for the daily operation of a brokerage business. With small class sizes run by professionals with years of experience, this is an excellent way to gain close access to support from experts in the business
Online training resources
The Freight Broker Boot Camp
The Freight Broker Boot Camp is not only amongst the most popular freight broker schools, but also one of the best value, offering students, once they enroll, unlimited access to the online course for a one-time payment of $185. It was created by Dennis Brown, an experienced freight broker, who will guide you through the process of establishing your business, as well as developing your business plan and roster of contacts.
Freight Broker Course
The Freight Broker Course offers a comprehensive range of materials, instructional videos and guides, offering students all the insight needed to conduct daily operations. These include useful tools for sales, marketing and negotiation. This online freight broker training program offers four component courses, ranging between $124 and $774, which, depending on your choice, may include access to a Transport Management System.
If you’re keen to conduct online training, but you want to explore more options, feel free to examine our list of Freight Broker Training Schools.
Is becoming a freight broker worth it?
Job outlook for freight brokers
With the continued growth of e-commerce and our continued reliance on delivered goods, the transportation industry is strong and looks to continue growing and evolving.
As such, the job outlook for freight brokers is strong, as they play a vital role in facilitating this industry, promising profitability and a growing market for new brokers.
Do freight brokers make money?
Across the US, there is some significant variation in the salaries brought in by freight brokers. According to Indeed and the Bureau of Labor Statistics, freight brokers in Alaska make an average salary of $39,620, whilst brokers in Kansas make an average salary of $75,686, and the national average is $62,105. This doesn’t include the average compensation of $28,000 through commission.
Are freight brokers in high demand?
As the global market and freight industry continue to grow, the demand for freight brokers is high, and continuing to grow.
Starting your freight brokerage
Whilst there are upfront costs associated with starting your brokerage, these costs can pay for themselves quite quickly. This is especially true if you’re willing to invest in a training course to get your business up and off the ground with guidance.
Is being a freight broker hard?
Whilst there are many perks of being a freight broker, it is a role which requires a great deal of responsibility, forethought and the ability to manage a rapidly-changing landscape.
Supporting the efficient transit of carriers is one vital challenge faced by freight brokers, as it is in their interest to ensure that goods are transported as fast as possible. This means that it’s your responsibility to stay aware of the causes of potential delays, such as poor weather conditions and road works which can affect trucking. This also means that your work can be affected by unexpected break-downs.
It’s also important that you maintain effective organization at all times. Whilst working as the intermediary between lots of fluid actors, it’s your job to ensure that a number of processes interact and meet as efficiently as possible. Whilst techniques, such as the use of carrier packets, can facilitate this work, it’s your responsibility to make sure that these techniques are carried out effectively, as failure to properly prepare can cause hold-ups.
How long is freight broker training?
As freight broker training programs are not a legal requirement, there is no formally required period of training. However, many schools offer five-day courses, and placements, or experience working with brokers prior to opening your own brokerage, is always recommended.
What kind of hours do freight brokers work?
Working as a freight broker, especially if you have your own freight broker business, can offer you lots of flexibility in theory, as you can often work from home at your own pace.
However, given the high-speed and fluid nature of the work, you may have to be widely available at different times of day in order to collaborate with partners in different time zones, and in order to respond to changing weather patterns.
If you’ve already begun the application for your Freight Broker Authority, then your next step is to purchase a Freight Broker Surety Bond. By starting your process today with Lance Surety, we can help you to find the best rates possible for your Freight Broker Bond.
Latest posts by Robin Kix (see all)
- How to Get a Car Auction License in Florida - February 14, 2023
- How to Get a Carpenter License - February 14, 2023
- Your Guide to Car Auction Licenses in Texas - February 14, 2023