How to Find Your Niche as a Freight Broker or Agent

Q: What are the legal requirements to operate as a Freight Broker?

You must submit your Freight Broker Registration application to the Federal Motor Carrier Safety Administration (FMCSA) through their Unified Registration System. Upon receiving your pending US DOT number you’ll also need to meet the additional requirements of proof of financial responsibility by posting a $75,000 Surety Bond or $75,000 trust fund, filing your BOC-3, and filing a yearly Unified Carrier Registration.

Q: What's the difference in being a Freight Broker and Freight Broker Agent?

The first one works on his own, runs his company. The second one is an employee of a brokerage company and gets a commission percentage of the brokerage fee.

Q: Can I work at home?

You not just 'can' but you 'must' work at home at the beginning in order to save money, keep your expenses low while you grow and develop your business.

Q: What is a Freight Broker (Property Broker)?

Property Broker is the correct terminology for many names used in the business to identify what we do. Truck Broker, Freight Broker, Load Broker, Freight Agent, Transportation Broker or simply Broker or Agent are all interchangeable terms synonymous with ‘Property Broker’. An active FMCSA registration to operate as a Property Broker allows a third-party to arrange pick-up and delivery of a Shipper's product by a Carrier without ever having physical control of the shipment.

Q: Does a Freight Broker need a broker’s license specific to their state or in each state?

Freight Brokers are regulated by the Federal Motor Carrier Safety Administration (FMCSA). The Freight Broker registration with the FMCSA allows us to make arrangement for the transportation of freight anywhere within the United States. So, no, you will not need a separate freight broker’s license for each state.

Q: How much does it cost to apply for your Freight Broker Registration / US DOT # with the FMCSA?

The FMCSA charges $300.00 to apply for a registration with an operating status of a motor property carrier, motor passenger carrier, freight forwarder or freight broker. The FMCSA does require all new applicants to complete their registration application online through their Unified Registration system. No new applications by mail. If you’d like, a Freight Broker Training filing specialists will file for your Freight Broker Registration on your behalf with the FMCSA for $450.00 (includes the $300.00 fee charged by the FMCSA). Plus, our course graduates are eligible for one Freight Broker Registration filing service included in their course cost ($150 value, filing service does not include the $300.00 fee charged by the FMCSA).

Q: What is a BOC-3 and how much does one cost?

A BOC-3 form is provided by a process agent. It’s a blanket form of coverage that designates a representative in each individual state upon whom court papers may be served in any proceeding brought against a motor carrier, broker or freight forwarder. A BOC-3 form and filing is usually priced between $25 to $150, depending on the process agent providing the form.

Q: What is the difference in being a Freight Broker or a Freight Broker Agent?

A broker is the owner of his or her own company. They are required to meet all legal requirements (FMCSA Registration, Bond/Trust Fund, BOC-3) to operate as a broker. An agent works under the umbrella of the registered broker and typically receives a commission percentage of the brokerage fee.

Q: Is Freight Broker training school required?

Currently the answer is “Not yet”. Soon, the FMCSA will be establishing new rules requiring brokers to show proof of knowledge or have relevant experience. However, whether training is required by law or not, the reality is that the failure rate for those who attempt this business without freight broker training is high. In order for a broker to be successful in any industry (stock broker, real estate broker, etc.), formal training is a must. Freight Mover School will prepare you to perform broker duties in a profitable, ethical manner, giving you the tools needed to be successful in the field.

Q: Should a Freight Broker school be affiliated with a freight brokerage?

Yes! And the instructors should be actively engaged in brokering freight. How can an instructor teach something they don’t do themselves? When a school tells you they are affiliated with a brokerage ask for the brokerage name and US DOT # or MC # so you can check their FMCSA registration or authority and make sure it is current.

Another crucial tip for you to become successful in your freight broker or freight agent job is to place an emphasis on one specific market section. Being a generalist is good but you pose yourself at risk not to become a master in anything at all.

The lesson I learned well from the launch of my own brokerage is that you can’t go well trying to do everything for everybody nor in freight brokerage nor in any other. It’s just impossible!

For that matter my decision was to get a good command of one specific market section gaining as much experience and profit as I could and only then scale up.

The below video shows the process I went through at a start. It can be helpful for you to find your best market niche in freight brokerage.

As I say in the video market niches can be of different form and size. The examples in this video are for illustrative purposes only; you should do it your way.

Types of equipment

Step-Decks/Flatbeds/ /Lowboy trailers/RGN trailers
Wagons
Refrigerators
Power Only (PO)
Many other

Types of product

Building Materials
Steel
Products
Meat/Poultry
Gas&Oil
Beverages in bottles
Heavy Equipment
Many other

Location/Lane Based

Chicago outgoing cargo
Northeast outgoing cargo
Cross-border cargo
Specific lanes like So Cal to TX
Many other

Mix of 1, 2, 3

Northeast outgoing van cargo
CA products
CA to TX flatbed cargo
Many other

I’m a great advocate of being a narrow-specialized master, especially in such a difficult business as freight brokerage. Even a proficient freight broker has a hard time quoting and sending piles of papers between Chicago and San Francisco being the same moment asked to dispatch an ice cream at a due temperature from New York to Dallas. Do you think it’s real to be busy with something else?

Naturally it won’t do without expanding in other market sections, the income should be potentially maximized, but learn the rule – first comes one specific sector you put focus on, then all additional, but no sooner than you become experienced and profitable in the first one.

To put focus on means to follow the course until successful completion.