Being a freight broker is a rewarding career because freight brokers are crucial to the success of supply chain management. What makes the profession even more attractive is that freight brokers can earn substantial amounts of money. In this guide, we will answer commonly asked questions about freight broker finances, such as: “How does a freight broker get paid?” and “How much does a freight broker make per load?”
How do freight brokers earn money?
There are two types of freight brokers – those who work for themselves and those who work for larger logistics companies. Independent freight brokers are typically paid a commission fee for managing freight transportation for a shipping company. They are also commonly paid for shipping the freight, which they pass on to the carriers. On the other hand, freight brokers who work for logistics companies commonly earn a base salary plus commissions, fees, and benefits.
What determines how much a freight broker makes per load?
When freight brokers earn commissions, the amounts are totaled in one of the following two ways:
- The commission is the amount of money the freight broker can save on shipping costs.
- The commission is a percentage of the total shipping costs.
When freight brokers earn salaries, commissions still work similarly but may be lower rates overall.
Do freight brokers set their own rates?
In general, independent freight brokers can choose their own rates, while freight brokers that work for logistics companies have to stick to the established company rates. While some freight brokers may have more control over their rates than others, all freight brokers must face the same reality – shippers pay freight brokers for their services because they want to save money on shipping costs. Thus, freight broker rates must be reasonable and competitive.
How To Make More Money as a Freight Broker
The great thing about being a freight broker is that there is no limit to the amount of money you can make. Whether you are just starting out or looking for a raise after years in the field, here are some tips to increase your income.
1. Ship More Loads
Freight brokers earn a commission on each load they ship. So, a way to earn more money is to ship more loads. However, for some freight brokers, this is easier said than done. Essentially, freight brokers can ship more loads in one of two ways. The first way is to work more. Freight brokers can choose to work more hours to network and secure more jobs. The second way is to gain more experience and ship more loads within the same amount of time. This requires learning the ropes, solidifying relationships, and practice.
2. Ship More Valuable Freight
Another way freight brokers can make more money is by shipping more valuable freight. When you know what you are doing, it takes the same amount of effort to ship $1,000 or $10,000 worth of goods. The commission on the higher-value shipment is larger. While there is often a lot of competition to get these loads, savvy freight brokers can use their networking skills to form strong relationships and provide excellent customer service to keep customers loyal.
3. Enhance Your Services
Another great way freight brokers can increase their income is by enhancing their services. Delivering the best customer service, providing exceptional convenience, and offering some attractive perks will allow you to charge higher rates while also outpacing the competition. Quality customer service involves proactive communication, attention to detail, active listening, and more. Continually work to improve your customer service skills, and this will pay dividends in the long run. Some perks and convenience include picking up shipments instead of requiring customers to drop off shipments. The relevant perks and conveniences may change over time, so keep tabs on the market and talk to your shippers to understand what they need the most.
- Work for a Quality Logistics Company
Perhaps one of the most effective ways freight brokers can make more money is by working for a quality logistics company that provides the support and resources to drive your success.
Here at First Star Logistics, we pride ourselves on empowering our freight brokers to succeed. All of our freight brokers work with our dedicated management team whose main goal is to offer complete back-end support across multiple departments. We also offer the highest commissions in the industry, weekly pay, proprietary software, 24/7 agent support, and low customer saturation.
To work with First Star Logistics, apply today!