WHAT’S THE DIFFERENCE BETWEEN FREIGHT BROKER & FREIGHT AGENT?
At the TOP level the difference between a freight broker and a freight agent is: a FA is an individual or group of individuals that functions as an independent contractor under a freight broker’s operating license to move freight for its customers, while the FB moves freight under its own FMCSA operating authority.
A FA is sometimes called a sales agent because they often sell for the FB they represent versus sell and operate the business, although they could choose to sell and operate the customers they acquire.
There are additional nuances that come from a freight agent / freight brokerage relationship that we’ll describe in greater detail next.
FBs earn money through the margin spread between what the sale price to the shipper and the freight cost of the underlying motor carrier.
The FA earns its money on a commission of the spread it negotiates with its customer and the underlying asset motor carrier.
A FB has a more consistent look and feel across its offices versus FAs under a broker.
FAs are typically small businesses that operate out of their homes, while a FB is most often a much larger entity.
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