Both dispatchers and freight brokers play important roles in the movement of freight. Although it is easy and common to conflate the two roles, and they share many of the same roles, they are actually two separate jobs. In this guide, we clear up the discrepancies between freight broker vs. dispatcher.
What is a freight broker?
A freight broker is a person who brings shippers and carriers together to move loads throughout the supply chain. A freight broker’s job is to find the right carrier for a shipper and find the right loads for carriers to haul, serving as the match-maker between the two. However, freight brokers do not simply make connections. They also smooth the communications and facilitate all of the necessary logistics between all parties involved in the movement of a load.
From a shipper’s perspective, a freight broker provides a single source of contact – negotiating the best price, planning the route, and managing the load on the shipper’s behalf. From a carrier’s perspective, a freight broker helps optimize routes, reduce deadhead miles, and increase profits.
What is a dispatcher?
A dispatcher manages load transit status communications with drivers. Dispatchers often work for carriers, either as employees or contractors. They coordinate shipping movements in advance and during hauls, working directly with drivers to resolve and communicate events and issues on the road. They are also key players in ensuring on-time delivery of loads. Additionally, dispatchers may work to find and schedule loads, and coordinate arrangements between shippers and carriers.
Key Differences Between a Freight Broker vs. Dispatcher
There are a number of overlaps between freight brokers and dispatchers. Both roles require exceptional communication and problem solving skills, and both roles involve managing the movement of freight. However, there are some important differences between the two.
Representation – Dispatchers commonly represent the carriers. Freight brokers commonly work for both the carriers and shippers, ultimately representing the brokerage company as a whole.
Goal – The goal of a dispatcher is to help carriers navigate the movement of freight. This involves a great deal of administrative and communication tasks. The goal of a freight broker is to efficiently connect shippers and carriers to successfully move freight. This involves a great deal of research, relationship development, negotiation, and communication tasks.
Licensing – Dispatchers are not licensed. In contrast, freight brokers are licensed by the Federal Motor Safety Administration (FMSA).
Payment – Freight brokers typically involve the shipper and then pay the carrier from invoice, keeping the difference between rates. On the other hand, dispatchers are typically paid by the carrier, and their contracts do not include the shipper.
Responsibility – Dispatchers are primarily responsible for maintaining direct and thorough communications with drivers on the road. Freight brokers hold responsibilities to the freight company, the shippers, and the carriers.
When To Use a Freight Broker vs. Dispatcher
So which professional is best for you? Should you use a freight broker or a dispatcher? The short answer is both! While the duties and roles of freight brokers and dispatchers overlap in a few ways, it is helpful to have both roles filled in any transportation solution. While it may be tempting to cut corners, freight shipment is not the place to do so. Opting to lower costs by removing key professionals will ultimately cost more in the long run as the risk of headaches and issues increase. If you are a shipper, take advantage of the benefits that freight brokers can deliver to your operations, and choose a freight brokerage that is well-resourced. If you are a shipper, take advantage of the benefits that both freight brokers and dispatchers can bring to your operations.
Here at First Star Logistics, we provide our shippers with comprehensive freight transportation solutions to ensure the job is done right, at the best possible rates. We are a unique asset-based global logistics provider with more than 60 years of experience. Our core business is arranging and securing space for your freight’s transport between states and countries using common carriers such as trucks, railroads, and ocean liners. Our clients benefit from a comprehensive North American network and global reach, along with time and cost-saving technology that delivers results.
To learn more about freight brokers, read our blogs:
Freight Transportation Brokers: What is Freight Brokerage?
How Does Freight Brokerage Work and How to Pick a Freight Broker
How Freight Brokers Can Reduce Empty Miles for Truckers
To learn more about the freight broker industry and logistics solutions, visit First Star Logistics today.