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Definitions for Beginning Freight Brokers and Agents

In these times of international economic uncertainty, Americans from all walks of life are searching for recession proof income. One industry that's relatively safe from hard times is trucking and shipping cargo across the nation and the world. No matter how hard times get, people always need the items that get moved in cargo ships and trucks. So it's not surprising the freight brokering and shipping business has absolutely taken off in the past few years. But while this at home business is relatively easy to start, it can be confusing. To help beginners, here are a few commonly used terms in the international and domestic freight brokerage industry.

  • BOC3 - The basic form that every broker who works on behalf of logistics or transportation companies must file with the federal government. This form designates the person who will be served papers in any legal matter.
  • Broker's Authority - A form that all freight brokers who operate in the United States must file with the Federal Motor Carriers Safety Administration (FMCSA) to establish themselves as a legal broker. This form is required whether the broker is working with global or domestic carriers.
  • Freight Broker - Describes an individual who is working under his or her own Broker Authority. That is to say, this is the person whose names appears on the OP-1 form with the FMSCA and bears legal responsibility.
  • Freight Broker Agent - A broker who works under another agent's Broker Authority. An agent does not incur the same legal responsibility as a broker.
  • Surety Bond - A form of insurance that freight brokers must carry to insure that covers any losses that may be incurred as a result of their actions. This may include the costs of lost loads.
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    Coach Logistics
    43 N. Dogwood Drive, Mayflower, AR 72106
    (501) 470-3212
    Logistic Services Inc
    9001 Lindsey Rd, Little Rock, AR 72206
    (501) 490-2027


    Freight brokers or logistics agents will work with transportation companies and their customers to determine the needs of the customer, finding a well matched carrier that will ship the cargo at a cheap rate. Freight brokers will find truckers who are licensed and insured to transport different loads of cargo from one location to another. Since many freight and logistics agents are contractors and work independently, they will work by commission. Therefore, they will strive to make both the customer and carrier happy. There are classes available to become a freight broker, however many in the industry gain the training and experience they need by working as a carrier. Most will start their career by delivering cargo for a transportation company while learning about all the ins and outs of transporting by air, sea, or land. In return, they can help customers find the best method and rates for shipping their containers. Truck companies can hire a freight forwarding broker to help their truckers get more business. To hire a local freight broker, customers can call several different agents to set up a consultation session. The agent will answer questions about how much they charge, and how long the process of finding a transportation company takes. If hired, they will then work with the customer to determine what their needs are and narrow down the many available companies to find the best. Truckers that want to get in the freight broker industry can start looking for clients in their spare time and gradually turn it into a full time job after the required licensing and insurance has been completed.
     
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