I always get asked this question, so I thought it was a great topic to post on the blog. I hope you find it interesting, and don’t be afraid to leave comments below!
First of all, first of all, I want to say that becoming a freight broker or freight agent is not some pie-in-the-sky or money button! Yes, there are plenty of opportunities here, and the services of a good freight broker and agent are in demand, but it’s not some kind of scheme to make a quick buck, I take it more as an option to slowly get rich! As with any entrepreneurship, the success or failure of the business will directly depend on the skills, plan, capabilities, and hard work of the people who run the business.
Our video is all about “”17 steps to earn money as a freight broker in 2022!”” topic valuable information but we also try to cover the subjects:
- -how do freight brokers make money
- -how much money do freight brokers make
- -how do freight brokers get customers
First of all, let`s talk about what the top 5 freight brokers made in 2022, based on the Transport Topics Top 50 Freight Brokerages ranking.
CH Robinson: $13.6 billion
Total Quality Logistics: $7.8 billion
Coyote Logistics: $5.5 billion
Worldwide Express/GlobalTranz: $4.6 billion
Echo Global Logistics: $3.7 billion
First of all, I want to state for the record that we are talking about the largest freight brokers in the United States. In fact, the freight brokerage business is very fragmented by thousands of brokers, most of whom have sales of less than $5 million a year.
In business, as you will soon learn, revenue is fine, but what matters most is profit. It is estimated that in most cases, freight brokers operate at 12-20% gross margin. That means that at $5 million in revenue, the gross margin contribution would be between $600,000 and $1 million. To calculate your actual pre-tax profit, you must first subtract all expenses, including office expenses, utilities, marketing, salaries, commissions, travel, entertainment, etc. As a result, your pre-tax profit for $5 million would be somewhere in the range of 5-10% of the revenue, which is $250,000 to $500,000 in pre-tax profits.
As for freight broker agents, of whom I have met hundreds during my career, their income depends primarily on their skills, plans, resources and work discipline. Beginning freight agents make a modest profit of $30,000 to $50,000 a year in commissions working from home, while the larger freight agents I know make $100,000 to $400,000 or more a year. As was shown in the video earlier, top freight broker agents can make as much as $50,000+ a month in commissions depending on the size of their client base and the volume of freight they move daily.
Ultimately, working as a freight broker or freight agent can be very lucrative, but as I said in the beginning, it is not the way to get rich, but with proper training, a good plan, and hard work there are many opportunities.