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A freight broker is an intermediary between a shipper and a freight service provider. Freight brokers can specialize in certain types of freight, such as equipment hauling on lowboys, oversize, bulk tanker, auto, or other types of freight transportation. A freight broker in the United States must be licensed by th
Federal Motor Carrier Safety Administration (FMCSA)
A freight broker, in freight transport (
cargo Cargo consists of bulk goods conveyed by water, air, or land. In economics, freight is cargo that is transported at a freight rate for commercial gain. ''Cargo'' was originally a shipload but now covers all types of freight, including tran ...
), over
land Land, also known as dry land, ground, or earth, is the solid terrestrial surface of the planet Earth that is not submerged by the ocean or other bodies of water. It makes up 29% of Earth's surface and includes the continents and various islan ...
in the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territo ...
by
truck A truck or lorry is a motor vehicle designed to transport cargo, carry specialized payloads, or perform other utilitarian work. Trucks vary greatly in size, power, and configuration, but the vast majority feature body-on-frame constructi ...
is often used as part of the
logistics Logistics is generally the detailed organization and implementation of a complex operation. In a general business sense, logistics manages the flow of goods between the point of origin and the point of consumption to meet the requirements of ...
. This may be part of an overall shipbroking using a cargo broker, a
freight forwarder A freight forwarder, or forwarding agent, is a person or company who, for a fee organizes shipments for individuals or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution.
, third party logistics broker (3PL), and even a fourth-party broker, when
outsourcing Outsourcing is an agreement in which one company hires another company to be responsible for a planned or existing activity which otherwise is or could be carried out internally, i.e. in-house, and sometimes involves transferring employees and ...
is needed (as opposed to in-house) for freight transportation. The brokering can be single mode or by
multimodal transport Multimodal transport (also known as combined transport) is the transportation of goods under a single contract, but performed with at least two different modes of transport; the carrier is liable (in a legal sense) for the entire carriage, even t ...
ation and can use specialized brokers on a permanent basis or as needed to ensure timely
traffic management Traffic management is a key branch within logistics. It concerns the planning control and purchasing of transport services needed to physically move vehicles (for example aircraft, road vehicles, rolling stock and watercraft) and freight. Traffi ...
. A load may be posted on a truck load board by shippers, brokers, or agents. This may occur with special orders, brokers and/or agents that do not have an established logistics base, or brokers and agents seeking a backhaul for a truck not in a high-traffic lane. Many brokers specialize in certain freight such as full truckload (FTL) or
less than truckload Less-than-truckload shipping or less than load (LTL) is the transportation of an amount of freight sized between individual parcels and full truckloads. Parcel carriers handle small packages and freight that can be broken down into units less t ...
, auto, boat or
yacht A yacht is a sailing or power vessel used for pleasure, cruising, or racing. There is no standard definition, though the term generally applies to vessels with a cabin intended for overnight use. To be termed a , as opposed to a , such a pleasu ...
, bulk tanker (
liquid A liquid is a nearly incompressible fluid that conforms to the shape of its container but retains a (nearly) constant volume independent of pressure. As such, it is one of the four fundamental states of matter (the others being solid, gas, ...
or
dry goods Dry goods is a historic term describing the type of product line a store carries, which differs by region. The term comes from the textile trade, and the shops appear to have spread with the mercantile trade across the British Empire (and forme ...
), oversize, equipment hauling on lowboys, flatbed, drop deck, or any other mode of freight transportation with enough loads.


Co-brokering

Co-brokering is a legal practice used to ensure there is an available truck to transport freight. A 4PL may use a 3PL broker to match loads with trucks, with a shippers knowledge. The primary broker will take a lesser amount of the fee and the secondary broker will book the load for transport receiving a larger share of the same fee.


Concerns

Double-brokering or rebrokering is illegal in the United States of America and occurs when a broker charges a fee then contracts the load to a second broker who will reduce the freight charge also collecting a fee that can be up to 15%. For example, an $1,150 load going 400 miles would net a carrier $977.50, but the same load double-brokered might result in $875.00 to the carrier. This margin on the second booking would net the broker an ''additional 14.3%''. The shipper may not be aware of this and will likely not be dispatched to pick up the load. This might have serious ramifications in case of an accident or incident, especially if there are operating issues with the carrier. Confusion on payment might lead to a
possessory {{unsourced, date=September 2018 In legal usage, Possessory forms several compounds. Conventional meanings :(1) of or pertaining to a possessor; :(2) arising from possession (e.g. possessory interest) or :(3) that is a possessor (e.g. possessory ...
lien (as opposed to "freight charges held hostage."), a load not delivered, and lawsuits.


References

{{transport-stub Freight transport