What is a Broker?
A broker refers to a person or an entity who acts as a mediator between a seller and a buyer. Basically, the broker acts as an agent to the customer on behalf of the seller. In turn, the broker receives a commission for their service. Brokers provide an important and valuable service to both motor carriers and shippers. They help carriers fill their trucks and earn a commission for their efforts. They help shippers find reliable motor carriers that they might not have otherwise known about. In fact, some companies use brokers as their traffic department, allowing the broker to coordinate all of their shipping and transportation management needs.
Brokers aren’t new to the trucking industry; they’ve been around since the industry itself began in the early part of the 20th century. Prior to the 1970’s, however, regulations governing brokers were so restrictive that few firms were willing to even try to gain entry into the industry. But with dramatic changes in federal transportation policy during the 1970’s, regulatory restrictions have eased, creating new entrepreneurial opportunities in the third party logistics provider arena.
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