Freight brokers act as middlemen for shippers and carriers.
A freight broker is responsible for matching companies needing to ship products and materials with reliable trucking companies that can deliver on time and in good condition. Brokers can work for an established agency or start their own agency. To be successful requires training, a license and bonding.
Experience
Formal education is not required to obtain a freight broker's license. But working in the shipping industry with a carrier company or as an agent for a freight broker gives invaluable experience. Training courses for freight brokers are also available, although these are a more expensive route for learning the business and do not offer the same opportunity for establishing contacts.
License
A freight broker must be licensed and registered with the Federal Motor Carrier Safety Administration (FMCSA). Registration is obtained by filing an Application for Motor Property Carrier and Broker Authority form and paying the application fee of $300. Once the application has been processed, a motor carrier number will be assigned to the applicant. This number allows the applicant to obtain the bond which is needed to continue the application process. Once a bond has been obtained, the broker applicant must then declare process agents in any state where he will be performing business and file a Designation of Process Agent form for each agent. Once this has been completed, the application can be processed and approved for licensing.
Bonding
Freight brokers are required by law to carry a $10,000 surety bond or a $10,000 trust fund agreement. This is required before the license is issued by the FMCSA to complete the application process. A copy of this bond must be submitted to the FMCSA. The bond, or trust fund agreement, ensures the protection of the business clients and customers.
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