Owning your own independent freight brokerage company can be an exciting venture, but it is important to understand the financial implications. Here are some key considerations:
Startup Costs: While there are no specific education requirements to become a freight broker, starting your own brokerage does come with costs. Depending on factors like business structure and operational investments, these can range from several thousand dollars to over $10,000. Expenses include licensing fees, office space, technology, insurance/surety bond, and marketing/sales.
Profit Margins: As a licensed freight broker, you’ll earn 10% to 30% profit margins on each shipment. The exact margin depends on factors such as transportation mode, complexity, and distance. Owning your brokerage allows you to maximize profits compared to working as a salaried employee.
Cash Flow Management: Brokering involves managing the gap between money going out (paying carriers) and money coming in (from shippers). You must plan for consistent cash flow to cover operational expenses and ensure smooth operations.
Market Volatility: The freight industry experiences fluctuations due to market conditions, seasonality, and economic shifts. Brokers must adapt to changing demand, pricing, and capacity.
Becoming a Freight Agent: A Viable Alternative
If running your own freight brokerage business seems daunting, consider becoming a freight agent for an established freight brokerage firm or a third-party logistics company with a freight agency program (like Logistics Plus). Here’s why:
Reduced Risk: As a freight agent, you’re not responsible for the entire business. Instead, you focus on sales, customer relationships, and finding loads. The parent brokerage firm handles administrative tasks, carrier payments, and compliance.
Access to Technology: Becoming a freight agent for a larger, more established third-party logistics company often provides you with access to better, more cutting-edge technology, such as a transportation management system (TMS) with robust functionality and API integrations.
Broader Range of Services: Partnering with a third-party logistics company that offers additional services, such as air and ocean freight forwarding, project logistics, warehousing, etc., expands the services you can sell to your customers and opens up additional earning potential.
Training and Support: Established brokerage firms provide their freight agents with training, mentorship, and ongoing support. You’ll benefit from their industry expertise and established carrier relationships.
Earning Potential: While freight agents earn commissions (typically a percentage of the parent broker’s profit), the stability and support can lead to consistent income. As you build your client base, your earnings can grow steadily. However, do your due diligence to ensure you find a growing, fun brokerage firm that is financially stable.
In summary, both options have pros and cons. Owning your own brokerage company offers independence but requires significant investment and risk management. Becoming a freight agent for an established North American freight brokerage firm or a global freight forwarder provides stability and support while allowing you to focus on sales. Remember, success in the freight industry depends on hard work, adaptability, and building strong relationships with shippers and carriers. Choose the path that aligns with your goals and risk tolerance.
Watch this short video on the benefits of becoming a freight agent for Logistics Plus.
Businesses that partner with a reputable third-party logistics (3PL) company to help manage their transportation can enjoy many benefits. Specifically, when you work with Logistics Plus, you enjoy the peace of mind from working with a top freight brokerage firm, a great supply chain partner, and a dedicated team of global logistics professionals.
With a managed transportation solution, the experts at Logistics Plus can identify more significant savings opportunities without increasing your staffing, and the savings we produce more than cover the staff we dedicate to your business. Whether it’s one, two, or ten, our dedicated logistics specialists work relentlessly to reduce transportation costs, protect compliance, improve efficiency, and optimize your supply chain.
Here are several key benefits to a company that partners with a 3PL to manage freight transportation.
Cost Reduction: 3PLs can often negotiate better rates with carriers due to their high volume of shipments. This can lead to significant cost savings for your company, especially if you don’t have high shipping volumes yourself.
Scalability: A 3PL can help you scale your logistics operations up or down as needed. This is especially useful for businesses with seasonal fluctuations in demand. They can provide the resources you need during peak times without you having to invest in extra infrastructure or staff.
Expertise: 3PLs have a wealth of experience in logistics and can help you optimize your supply chain. They can provide advice on everything from warehousing to transportation to customs clearance.
Multi-Mode Capabilities: Some 3PLs can support the management of all shipping modes, including parcel, LTL, truckload, air, ocean, or rail, both domestically and internationally.
Improved Customer Satisfaction: Using a 3PL can offer faster and more reliable shipping to your customers. This can lead to increased customer satisfaction and loyalty.
Technology: Many 3PLs can provide customized and integrated technology solutions for transportation management (TMS) and warehousing (WMS). Combined with business intelligence software, 3PLs can help provide a more complete picture of transportation costs across all modes.
Reduced Risk: 3PLs are also responsible for mitigating risks associated with transportation, such as delays or damage to goods. Some even offer shippers interest cargo insurance policies to cover high-value freight movements.
Focus on Core Business: By outsourcing your logistics to a 3PL, you can free up your time and resources to focus on your core business activities. This can help you grow your business and improve your bottom line.
Working with an established 3PL like Logistics Plus can be a great way for companies to improve their logistics operations, reduce costs, and focus on their core business.
The Freight Classification Development Council (FCDC) has discussed new amendments to the National Motor Freight Classification (NMFC®). These new NMFC changes are effective 08/05/2023.
Docket 2023-2, Subject 1 – Athletic Goods Group
Docket 2023-2, Subject 2 – Games or Toys Group
Docket 2023-2, Subject 3 – Paper
Drugs or Medicines, NOI – Item 58770
Docket 2023-2, Subject 5 – Railings, NOI – Item 35255
Docket 2023-2, Subject 6 – Adhesives Group
Docket 2023-2, Subject 7 – Office or Store Equipment Group and Stationery Group
Docket 2023-2, Subject 8 – Roof Gutters, Eavestroughs or Downspouts, or Fittings therefor
Docket 2023-2, Subject 10 – Fruit Juice Powders or Crystals; Juice, fruit or vegetable, including Juice Concentrates, Juice Beverages or Juice Drinks; or Preparations, beverage, NOI
Logistics Plus Ranks Among Transport Topics 2023 Top 100 Logistics Companies
Logistics Plus is also named a Top Dry Storage Warehousing Firm and a Top Freight Brokerage Firm.
ERIE, PA (May 3, 2023) – Logistics Plus, Inc. (LP), a leading worldwide provider of transportation, logistics, and supply chain solutions, is proud to announce that it has been named to the annual Transport TopicsTop 100 list of North America’s largest logistics companies based on gross revenue for the most recent 12-month period. With domestic sales approaching a half billion dollars, Logistics Plus made the final 100th spot among all third-party logistics providers competing in North America. Logistics Plus also ranked as the 44th largest dry storage warehousing firm and the 61st largest freight brokerage firm.
“With the historic supply chain disruptions of the last few years receding into the past, third-party logistics providers have been adjusting to normalizing freight market conditions while working to build more efficient and resilient supply chains for the future,” said Seth Clevenger, Transport Topics’ managing editor of features. “The Transport Topics Top 100 Logistics Companies list offers an updated look at how the industry’s largest 3PLs are adapting to this shifting business landscape.”
“I always say we punch above our weight class,” said Jim Berlin, Founder and CEO of Logistics Plus. “Even though we have the global resources to be recognized among the largest 3PLs, we maintain a flat structure with lean operations that are responsive to our customers’ needs. No customer is too large or small for us. They are all equally important.”
Since 1935, Transport Topics (TT) has been the news leader in trucking and freight transportation. When it comes to major issues, industry events, and new developments, TT journalists get the story first and get it right, keeping readers informed about all aspects of the trucking industry and helping them stay ready for what’s to come. Explore the latest at https://www.ttnews.com.
About Logistics Plus, Inc.
Logistics Plus, Inc. is a 21st-century logistics company that provides freight transportation, warehousing, fulfillment, global logistics, business intelligence, and supply chain management solutions through a worldwide network of talented and caring professionals. Jim Berlin founded the company nearly 26 years ago in Erie, PA. Today, Logistics Plus is a highly regarded, fast-growing, and award-winning transportation and logistics company. With its trademark Passion For Excellence™, Logistics Plus employees put the ‘plus’ in logistics by doing the big things properly, plus the countless little things that ensure complete customer satisfaction and success.
The Logistics Plus® network includes offices, warehouses, and agents located in Erie, PA; Aurora, CO; Buffalo, NY; Charlotte, NC; Chicago, IL; Chino, CA; Cincinnati, OH; Cleveland, OH; Colton, CA; Dallas, TX; Dayton, NJ; Des Moines, IA; Fontana, CA; Haslet TX; Honolulu, HI; Houston, TX; Jamestown, NY; Laredo, TX; Lexington, NC; Los Angeles, CA; Meadville, PA; Miami, FL; New York, NY; Norfolk, VA; Olean, NY; Phoenix, AZ; Riverside, CA; San Francisco, CA; Tulsa, OK; Vancouver, WA; Australia; Belgium; Brazil; Canada; China; Colombia; Czech Republic; Egypt; France; Germany; India; Indonesia; Japan; Kazakhstan; Kenya; Libya; Malaysia; Mexico; Netherlands; Poland; Saudi Arabia; Singapore; South Africa; Taiwan; Thailand; Turkey; UAE; Uganda; Ukraine; and Vietnam; with additional agents around the world. For more information, visit www.logisticsplus.com or follow @LogisticsPlus on Twitter.
The Freight Classification Development Council (FCDC) has discussed new amendments to the National Motor Freight Classification (NMFC®). These NMFC changes noted below are effective 04/08/2023.
Subject 1 – Furniture Group and Furniture Parts Group – Numerous items for furniture or furniture parts are canceled with reference to new item 78400, new item 79300, item 164390, item 178690 or provisions otherwise applicable, as shown.
Subject 2 – Plastic or Rubber Articles – Provisions for plastic or rubber articles, as shown, are updated by: reclassifying numerous products; canceling the Plastic or Rubber Articles or Materials, Expanded, Group; canceling obsolete provisions; amending minimum packaging requirements; and making other changes in the interest of clarification, simplification and uniformity.
Subject 3 – Dental, Hospital or Medical Supply Group – The Dental, Hospital or Medical Supply Group is updated by canceling numerous items with reference to new items 56570, 56590, 56830 or 56930, or item 188560, as shown. The group is further updated by canceling numbered packages and making other changes in the interest of clarification, simplification and uniformity.
Subject 4 – Cabinets, or Parts Named
Subject 5 – Pipe or Tubing, or Pipe or Tubing Fittings, metal – Numerous items, as shown, are canceled with reference to new item 52200, naming “Pipe, Tubing, or Pipe or Tubing Fittings, metal, combined or not combined with other materials, NOI,” with classes predicated on greatest dimension and density. Note, item 51902 is canceled and reestablished as new Note, item 52201.
Subject 6 – Pipe, Tubing or Pipe Fittings, NOI, mineral and resin composition combined – Item 52250 – Item 52250 is canceled with reference to item 156600.
Subject 7 – Foodstuffs, other than frozen – Numerous items, as shown, are canceled with reference to item 73260, which provides the FCDC’s standard 11-subprovision density scale.
Subject 8 – Sugar – Numerous items, as shown, are canceled with reference to item 73150, which provides density breaks at 10, 15 and 30 pcf.
Subject 9 – Pads, Padding and Related Articles Group – Numerous items, as shown, are canceled with reference to item 149265, which provides the FCDC’s standard 11-subprovision density scale.
Subject 10 – Brooms Group – Numerous items, as shown, are canceled with reference to new item 32800, naming “Brooms, Brushes or Mops, or Parts thereof, NOI,” with classes predicated on the FCDC’s standard 11-subprovision density scale.
Subject 11 – Mirrors – Numerous items, as shown, are canceled with reference to new item 137390, naming “Mirrors, NOI,” with classes predicated on greatest dimension and density.
Subject 12 – Chemicals, NOI – Item 43940 – Item 43940 is amended by assigning classes predicated on density, with breaks at 10, 15 and 30 pcf.
Subject 13 – Pesticides, including Insect Paper, and Flypaper – Item 155045 is canceled with reference to item 155050. Concurrently, item 155050 is amended to assign the FCDC’s standard 11-subprovision density scale.
Subject 14 – Carts, Wagons or Wheeled Trays, food or beverage preparation, serving or vending – Items 81570 and 188950 – Items 81570 and 188950 are canceled with reference to new item 189000, naming “Carts, Wagons or Wheeled Trays, food or beverage preparation, serving or vending, with or without cooking, cooling or heating devices or equipment,” with classes predicated on greatest dimension and density.
Subject 15 – Wheels or Wheel Blanks – Numerous items, as shown, are canceled with reference to new item 197230, naming “Wheels or Wheel Blanks, NOI.” As modified, the new item assigns classes predicated on packaging and density.
Subject 16 – Radiators, heating or cooling – Items 26800, 26840, 26860 and 26880 are canceled with reference to new item 26820, naming “Radiators, heating or cooling, NOI, or Unit Ventilators,” with classes predicated on greatest dimension and density.
Subject 17 – Guards, Screens or Covers, gutter, metal – Item 36650 is amended to read, “Guards, Screens or Covers, gutter, metal,” and to assign classes predicated on greatest dimension and density. The minimum packaging requirements are amended to authorize “in packages,” and new Note, item 36651 is established to provide additional packaging requirements.
Subject 18 – Items (Rules) 245 and 680 – Definition of and Construction Requirements for Crates – The requirements in Item 245 are clarified by: stating that crates are six-sided; amending the methods of securement; and specifying the bottom construction requirements. As modified, the requirements are amended to state that openings on sides, ends and tops must not exceed 25 inches in their greatest dimension, which may be the length, width, height or diagonal measurement of the opening. Item 680, Sec. 5(a) is concurrently amended to state that “in packages” also applies on articles tendered in a “crate-like framework not complying with Item 245.”
Subject 19 – Feeders, livestock or poultry – Numerous items, as shown, are canceled with reference to new item 65300, naming “Feeders, livestock or poultry, including Salt Holders, with or without conveyors or troughs,” with classes predicated on packaging and density.
Subject 20 – Bottle Filling, Labeling, Rinsing, Washing, Wiring, Capping or Corking Machines – Items 115220 and 115240 – Item 115220 is canceled with reference to item 115240. Item 115240 is amended to include “Capping or Corking Machines” and to assign classes predicated on packaging and density.
Subject 21 – Ice Cream Freezers (Ice Cream Makers) – Item 121400 – As modified, item 121400 is canceled with reference to new item 123135, naming “Ice Cream Makers, including Ice Cream-Making Freezers,” and assigning the FCDC’s standard 11-subprovision density scale.
Subject 22 – Peat or Peat Moss – The description of item 154900 is amended to read, “Peat or Peat Moss, NOI,” and class 70 is assigned.
Subject 23 – Culverts, Culvert Sections or Culvert Fittings, metal – Numerous items, as shown, are canceled with reference to new item 51015, naming “Culverts, Culvert Sections or Culvert Fittings, metal,” with classes predicated on greatest dimension and density.
Subject 24 – Blanks or Stampings, NOI, or Castings or Forgings, NOI, aluminum, or brass, bronze or copper – Items 13260, 13320, 30260 and 30320 – Items 13260 and 13320 are canceled with reference to item 13120, and items 30260 and 30320 are canceled with reference to item 30160.
Subject 25 – Dough Sheeters – The description of item 114390 is amended by adding “Dough Sheeters.”
Subject 26 – Removal of ‘F’ Packages
Subject 27 – Obsolete Provisions – Multiple Items
Subject 28 – Obsolete Provisions – Multiple Items
Subject 29 – Obsolete Provisions – Multiple Items
Subject 30 – Obsolete Provisions – Multiple Items
Subject 31 – Bicycles, electric (Electric Bikes or EBikes) – Deferred Subject – As modified, new item 190270 is established, naming “EBikes or ETrikes (Electric Bicycles or Tricycles),” with classes predicated on whether the products are shipped without batteries, with batteries installed, or with batteries uninstalled.
Additional detail is included in the DOCKET 2023-1 bulletin. As always, please contact us if you have any questions.
Owning your own independent freight brokerage company can be an exciting venture, but it is important to understand the financial implications. Here are some key considerations:
Businesses that partner with a reputable third-party logistics (3PL) company to help manage their transportation can enjoy many benefits. Specifically, when you work with Logistics Plus, you enjoy the peace of mind from working with a top freight brokerage firm, a great supply chain partner, and a dedicated team of global logistics professionals.
Logistics Plus, Inc. is 