Being A Freight Agent is Not Easy
Being a freight broker agent or a freight capacity agent is no easy task. You have all the headaches of a small business, a sales organization and the heavy regulation of the Federal Motor Carrier Administration (FMCSA)
Starting with the FMCSA, the new electronic logging device mandate has made your life more difficult as far as planning loads to. If you are a freight agent who is unlucky enough to be with a carrier that does not have a good plan on how to implement and manage the mandatory electronic logs then your life is exponentially more difficult.
Life is hard enough as a freight agent without having to fight your way through a flawed electronic logging mandate implementation policy from your carrier. Yes, if you are a freight brokers agent then this part does not affect you as much, you only have to worry about if your carrier has enough hours to actually get your freight to the consignee on time.
If you are a freight capacity agent and have ended up with a carrier that does not have a plan to implement the electronic logs then your best bet is to make a change, and do it quickly. As we the title above says, being a freight agent is not easy, why make it more difficult than it already is?
You need to be focusing on operations not fighting with a safety department that has failed to plan ahead. Whether you like the electronic logging mandate or not, it is the law and your drivers will have to comply if you are a freight agent.
Next you are a small business. This is what you really are and what your focus should be on running. The safety aspect is a part of that, but as a small business your relationship with your carrier is effectively like hiring them as an outsourcing company to handle your insurance, financing, safety, billing and collections. This is what your carrier should be providing you as an absolute minimum if you are a freight agent. If your carrier partner is not, then as a small business owner you need to look at options to improve your business.
As the owner of a small business or freight agency, you are responsible for your overall profitability. Yes, you contract some of that out to your carrier partner but remember you are the business owner. Your carrier is your partner as long as the relationship is mutually beneficial.
If it is not beneficial for you to continue the relationship and provided you do not have a long term contract you have to honor then you have the obligation to look around to find a better partner to outsource parts of your business to so you can focus on operations and sales.
Finally, you are a sales company. This goes hand in hand to operations when it comes to making money as a freight broker agent or a freight capacity agent. As a freight agent you have to be able to bring in new customers and maintain profitable relationships with your existing customers. Notice I said profitable relationships. I cannot tell you how many freight agents I have known in the past that kept customers just because it was easy and not because it was profitable.
Customers want service and low rates. Sometimes they favor low rates over service. These are the customers you need to stay away from or replace if you already do business with them. You cannot build a quality freight agency with a customer whose number one focus is price. You will constantly be adjusting your rates and never knowing one day to the next if you will have freight. These types of customers tend to go through a lot of carriers always looking for a cheap solution.
From time to time they will come back to you when service gets really bad for you to bail them out. Maybe, you will keep them for a month or two until they see an increase in their service then they will start looking for the cheapest rates again. Normally, this will happen when freight is the slowest and you will have no other options but to not have any freight or lower your rates
Don’t keep falling for this, find customers that value customer service and relationships. Stay away from customers that only care about price.
In the long run, your freight agency will be a much easier business to run and be profitable if you can follow these simple paragraphs in our article.
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