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What to Consider BEFORE You Hire to Expand Your Freight Broker Business

You’ve done your due diligence. You’ve managed to build a solid freight broker business with happy, long-term customers and mastered the technique of bringing on new customers regularly. In fact, business is booming! Sounds great, right? The problem is…your business is busting at the seams and there’s just you and maybe a partner that’s running the whole thing. If your business grows any more, your attention to the details and stellar customer service level that your clients are accustomed to will drop, you’ll have to refuse loads (wait, what???) and tarnish the top-notch reputation you’ve worked so hard to build or worse…potentially lose a customer!

You know the solution. You’ve toyed with it in your head for a while now – You have to hire more staff, but you just don’t think you can swing it – for a variety of reasons (or perhaps, excuses?). Starting a freight broker business was difficult enough but hiring more staff can be downright terrifying! Ask any start-up business owner and they’ll tell you how scary it was for them to hire their first person. So, here are some things you should consider that might help you overcome your fear of expanding your freight broker business and help you better navigate the process:

  1. Why Hire – Make sure you accurately identify WHY you want to bring on more staff. This could mean hiring someone for just dispatching, finding new customers or exploring a new niche in your office such as LTL or oversize, etc. Once you bring that individual on for a specific need, make sure you don’t divert their focus or muddle their main task(s) by adding on other tasks or making that person be the catch-all of other responsibilities. If you do, make sure it’s always in the best interest of the business and ok with your new hire, otherwise you run the risk of losing them and taking your business off track thereby hindering your success or growth. NOTE: It might seem logical to hire based on expertise. Keep in mind that you can always provide additional training to get your new talent up to speed or knowledgeable in certain areas of the business but you can’t train someone on attitude. When bringing on someone new, always hire for character FIRST, then experience.
  2. Hire Smart – Freight brokers need to realize that just adding extra heads to your office won’t necessarily help or increase your business. If you’re absolutely certain that you’re ready to bring on more staff, consider these key factors.
  3. Who to Choose – Do you want to hire a seasoned transportation professional or someone new to the industry? Hiring someone experienced will cost you more but you’ll benefit from having to spend little time to train them and they will be able to hit the ground running fast. Also, hiring one experienced employee could replace the need to hire 3 inexperienced employees. However, if you choose to hire an eager newbie, the training time will be longer but you can customize their training to tailor-fit your business. Either way, once you’ve found your great new hire, make sure you do your best to hold on to them by making them a respected and valued team member, paying them accordingly and empowering them to do the job they were hired and trained to do. And before you make your final decision to bring someone onboard, consider one last thing – perhaps THE most important factor…fit. They may be an outstanding, intelligent, hardworking individual, but they also need to fit in with your office and you. NOTE: It’s not only important but veryrealistic to understand that with whomever you bring on board, provide in-depth training to or give access to your extensive book of business, you always run the risk of them jumping to a competitor or taking your customers with them.
  4. What Tasks – Only YOU know who you need to bring on to help your freight broker business grow. If you know your office needs more help NOW, one of the safest bets and best bang-for-your-buck might be to hire a dispatcher. Hiring a dispatcher will help you cover loads, dispatch drivers, perform check calls, schedule pickup/deliver appointments, send rate confirmations and do carrier due diligence. This will buy you time to invest in customer interaction and relationships which drive all business!
  5. Business Flexibility – Don’t just decide to bring on another person because you’ve had a crazy week or hectic month. You need to ask yourself if your freight broker business has enough work to keep a new hire busy during slow times or seasonal slumps. Still not sure? The best rule of thumb is not to “think” you might need more staff. If you need to add more staff, believe me, you’ll know without a doubt when it’s time.
  6. Can You Afford It – Bringing on staff is another out-of-pocket expense for your freight broker business. You definitely don’t want to hire someone only to find out that you can’t afford to keep them! Below, I’ve kept with our hiring a dispatcher scenario to give you an idea of how to go about figuring new employee cost.
  7. Dispatcher Break-Even Analysis**:
    Hourly cost range of $8-$15per hour with an $11.00 average.
    $8 per hour = $1,492 Employee Monthly Cost / $166 per load = 8.98 loads per month
    $9 per hour = $1,680 Employee Monthly Cost/ $166 per load = 10.12 loads per month
    $10 per hour = $1,866 Employee Monthly Cost / $166 per load = 11.24 loads per month
    $11 per hour = $2,052 Employee Monthly Cost / $166 per load = 12.36 loads per month
    $12 per hour = $2,080 Employee Monthly Cost / $166 per load = 12.53 loads per month
    $13 per hour = $2,424 Employee Monthly Cost / $166 per load = 14.60 loads per month
    $14 per hour = $2,612 Employee Monthly Cost / $166 per load = 15.73 loads per month
    $15 per hour = $2,799 Employee Monthly Cost / $166 per load = 16.86 loads per month
    NOTE: The amount of $166 was used because that is the average agent commission per load at LDi over the past 12 months. **Employee costs are an estimate that includes related costs such as payroll taxes, benefits, tools, equipment and small supplies needed to perform their job.
  8. Ask yourself how long would it take to increase your load count by 8.98 to 16.86 loads per month if you could spend 3-5 more hours per day selling to your existing customers and calling on new customers.
  9. Would it take 1, 2, maybe even 3 months? Now ask yourself if the investment is worth it? The decision or indecision to grow is yours but always remember, “If you’re not growing you’re shrinking…you just don’t know it yet”!
  10. Growing Pains – You can’t bring on more people to your freight broker business without incurring additional overhead costs, not to mention compensation. More people in your office mean the need for additional equipment (phones, computers, printers, desks, chairs, headsets, etc.) and potentially more space, depending on if your current office space allows for additional bodies and equipment. You might need to move your business to a new and bigger space or location, which could mean additional (and costlier) expenses, such as utilities, rent/lease, parking, etc. Also, whether you bring on someone seasoned or not, you will still need to train them for their position as well as acclimate them to your business model and office procedures. This is another often overlooked expense when bringing on a new hire and, although the figure varies with each individual, your time is valuable and has a price. In addition, once they are fully functioning, you will still need to take additional time out of your daily schedule to monitor their activities and make yourself available to them for questions and guidance as needed.

One final note, it’s good to remember the old adage, “With great power, comes great responsibility” or the sage advice that “Rome wasn’t built in a day”. Now that you’ve decided to bring on one or more individuals into your freight broker business, you need to recognize your own new role within your company. You will need to adjust your mentality from being a one-man-band to being a leader as well as a team player. You will need to be the epitome of patience as you and your new hire(s) become acquainted to you, your business, your office space and additional staff, if applicable. You will need to trust them and turn over certain tasks…something you may not be comfortable with or used to doing. But, it’s up to you to invest in them and develop a strong team atmosphere. It will take time, but it can be done through honesty, transparency, trust, communication and by recognizing individual accomplishments and identifying and rewarding specific milestones or achievements. Once implemented, these actions will create happy workers by instilling loyalty, inspiring work satisfaction and helping to cement a long and happy professional relationship between you and your staff. And as we all know…happy workers are productive workers! In fact, new research suggests we are more productive and work more effectively, creatively, and collaboratively when we’re happy at work…TWELVE PERCENT more productive, to be exact!

Still unsure if you should expand your freight broker business and take on a new hire? Then, chances are, you’re probably not ready. But, if you firmly believe you are, hopefully this post provided some good insight to help you start the process. To learn more on the challenges and solutions for growing a successful freight broker business, watch our insightful workshop video, “Successful Freight Broker Agent Strategies and Techniques for Growing Your Business”, presented by a top LDi Agent http://bit.ly/1L2SwGK, where he goes into detail about his own brokerage’s growing pains and how he not only overcame them but grew to be a multi-million-dollar freight broker business.

If you have any additional suggestions on how to overcome the fear of expanding a freight broker business, I’d love to hear them! So, please feel free to comment on this or any of LDi’s blog posts or suggest future article topics and thanks for reading!

The How & Why to Diversify Your Freight Broker Business

The only thing constant is change and in order to build a successful and sustainable freight broker business you need to embrace diversification.

Diversification. The word tends to strike fear in the hearts of entrepreneurs and business owners alike, for two reasons:  To implement, it means that your business must undergo changes and consequently growing pains or choosing not to diversify means you run the risk of going under if you lose one or two or your largest customers. However, if done right, freight brokers and freight agents that choose to diversify can see their freight broker business and income grow as they expand their scope of business and reach out into untapped territories. This helps to add new customers to your client base as well as give you fresh opportunity to service your current customers in new ways!

Without a doubt, the reasons to diversify will always outweigh the reasons not to diversify your freight broker business. The question is how. Here are some options to help you explore ways to diversify:

1.      Grow Your Customer Base:  A good rule of thumb for freight brokers is when your freight broker business gets 10% of business coming from a single company or a certain industry – it’s time to expand your client base. The loss of that customer could be crippling. Focus on getting three new contacts a day and make that your daily challenge. HELPFUL TIP:  Think above your competition by utilizing different/varied ways to grow your business. Try LinkedIn – using the search function in LinkedIn can help you with targeted searches that narrow your results to provide you with more accurate leads to potential customers. Get Referrals – reach out to your vendors, associates and customers to turn a cold-call into a “warm call” and gain an instant conversation opener.

2.      Expand Your Services:  Every freight broker and every freight broker business needs to continually evolve or old habits and routines will cause you to overlook opportunities and potential threats that surround you every day. To expand your freight broker business, try branching out into other business sectors (lumber, bottled water, produce, etc.) and adding additional modes such as LTL, Flatbed, rail, ocean, etc. (note:  margins for a full load are at about 10%-20%, compared to the 20%-35% for a partial truckload) or simply try asking your customer for more lanes. The benefits to expanding your current services would help to offset seasonal setbacks or customer supply fluctuations. HELPFUL TIP:  Some factoring companies can provide you with credit ratings and analysis on shippers that will give you a better idea on whether your freight broker business should take on a potential customer or not.

3.      Utilize Social Media as a TOOL (not a distraction):  The use of social media for your freight broker business, such as LinkedIn, can be a valuable tool to promote your services. You can utilize their search functions to find similar businesses like your top customer. Try to join groups your customers would belong to-NOT other freight brokers-where you can interact and give input that could lead to additional business. A blog is a great platform to showcase your knowledge and experiences, promote your services and even establish yourself as an industry leader! HELPFUL TIP:  Content is always, ALWAYS the most important factor when promoting anything. The second most important factor is contribution. Don’t just post and post and post and post content. People will get tired of your one dimensional activity. Take the time to visit your groups regularly and offer valuable feedback or comments. Don’t forget to respond to any comments or feedback others leave on -your- posts and/or blog. Not just interaction but timelyinteraction speaks to your credibility and genuine connectivity to others and always be professional.

4.      Have a Contingency Plan:  As diversification quickly becomes the latest powerful way to grow and expand your business and proving to be a must for long-term success, it’s a good idea to have a contingency plan in place so that your business can still function during any unexpected turbulence that is especially likely in the volatile world of the transportation industry where a freight broker business is constantly at the mercy of the economy, capacity and the weather. HELPFUL TIP:  When creating a contingency plan, identify your key risks (loss of customer/revenue, weather fluctuations, technical disaster, etc.), prioritize those risks then you can decide what you will do to resume business in case one of the disruptive scenarios takes place. Your plan should basically answer these three questions: What could happen? What will we do in response? What can we do in advance to prepare?

Need a little kick in the pants to help you jump on the diversification wagon? Imagine walking into work tomorrow morning and your phone is flashing. It’s a voice mail from your biggest customer and they’re letting you know that they’re sorry but they’ve decided to switch to another freight broker. Motivated yet? I thought so…Now get growing!

BONUS:  Want to know more techniques that will save you time, increase your income and grow your customer base? Get our free report, “Top 10 Ways Freight Brokers/Agents Can Increase Their Income” that outlines specific ways every truck broker, freight broker or freight agent can implement to INCREASE THEIR INCOME IMMEDIATELY.

How to Be a Freight Broker Sales Call Rock Star!

When we are about to venture into new territory, we all wish we knew the right way to proceed or a roadmap that led us to a destination of success. In reality, it’s never that easy. If you’re starting out in the freight sales agent profession, calling on a prospect is not only a priority – it’s a necessity to establish and grow your freight broker business. And as a freight broker agent, you know that making effective sales calls is the difference between success and failure. You also know it’s not about getting prospects to just come on board. It’s about keeping them actively shipping with you, while offering them great service and the best prices.

So, wouldn’t it be great to know the freight broker’s secret to making a top class sales call? While it may seem simple, it most certainly is not easy. You will have to persevere through rejection and work hard day after day, bouncing back from the challenges of calling prospects. As once homeless then turned professional football player in the NFL and now motivational speaker, Eric Thomas says, “All roads that lead to success have to pass through Hard Work Boulevard at some point”.

85% of Your Financial Success
Research carried out by the Carnegie Institute of Technology shows that 85% of your financial success is due to your personality and your ability to lead, communicate and negotiate. Believe it or not, only 15% comes from technical knowledge. This is exactly the opposite of what the world tells you. We are told that the path to take is to go to school, get a degree and get the knowledge. Unfortunately, this only accounts for 15% of success! What the world doesn’t teach you is the other 85% – how to communicate, negotiate and lead. We are left to figure all that out by ourselves.

What You MUST Do When Making a Sales Call
Earning a prospect’s business by making them feel special and not just being the next name on a long list of sales prospects is the key to being a successful freight broker agent. You need to take the time to learn a bit about your prospect’s business/background, be well prepared before the call and always operate under the conviction that freight broker rock stars consistently do what average freight agents don’t or won’t.

Sales Call Information Sheet & Sales Call Script
To have a no-fail Sales Call, you need a no-fail Sales Call Information Sheet. A good habit to get into, is having a Sales Call Information Sheet that includes these important key details about the company/contact with whom you will be connecting:

  • Company name
  • Company phone number
  • Company fax number
  • Main contact name
  • First contact name
  • First contact date
  • Products / Services
  • Important information
  • Email address
  • Physical address

Why is this information so important to know, you ask? The answer is simple: because it’s these key details that will help you later construct a no-fail Sales Script*. And yes, it’s a given that information gathering is hard work but it will ALL be worth it when you plug your information into your Sales Script and become a top-producing, rock star freight agent.

It may sound basic but, in the freight broker business, perfecting your sales calls is the most important thing you’ll do in this profession. When you treat this part of your job with the importance it deserves, invest the amount of time that is necessary to obtain the information you need AND combine it with our no-fail Sales Information Sheet and our no-fail Sales Call Script, you will possess the weapons you need in your freight broker arsenal that will propel you and your freight broker business to accomplish what you had only ever dreamed of achieving!

If you have questions about this report or want more information about the industry’s most respected freight broker agent program, visit www.LogisticDynamics.com or call us today at 1-800-554-3734.

*For a great sample template of our no-fail Sales Call Script, please click here for the Free Report, “How to Be a Freight Broker Sales Call Rock Star”.

5 Ways For Freight Brokers To Never, Ever Give Up

The top reason for failure for any freight broker or freight agent is giving up. The good news is, YOU can overcome that reason and make yourself someone who doesn’t give up.

Whenever you are challenged, it’s always hardest in the beginning before it becomes easy. Freight management is no exception. For any freight broker starting out, you will undoubtedly face the challenges of forming a foundation; making calls, building relationships and receiving loads. However, as you gain success over time, it does become easier and even fun.

What challenges will you face as a freight broker/freight agent? One challenge for a beginning freight broker is when they start to accumulate successes in their career, they sometimes tend to give up or push themselves less and less. On the flip side, if the freight broker does not see a success or big enough payoff soon enough – they give up completely. The biggest mistake anyone can make is to start something, hit a few road blocks right away, and then give up before it gets any easier. Plus you’ve just wasted a bunch of time!

What’s fantastic about this industry is when you make the commitment to NEVER, EVER give up, you can’t help but be a success! Only when you commit and persevere, will you achieve all of your business, career and financial goals. It all begins with promising yourself that you’ll stay the course and not divert from it.

Why would you give up anyway? You wouldn’t give up eating. You wouldn’t give up sleeping. You wouldn’t give up waking up in the morning. So then why would you give up on your goals and dreams?

Why Do We Give Up?

I’m sure many of you have seen hundreds of articles about successful entrepreneurs and thought to yourself, “Well, it’s easy for them to say ‘Never give up’ when they’re a successful entrepreneur! Everything I’ve ever attempted has failed!”

That’s a key point for this topic: The reason we give up is because we’ve allowed so many other attempts at success to fail. After enough experiences with attempting something numerous times and allowing it to fail, we begin to associate our dreams with failure and disappointment.

The lies we hear in our mind keep telling us that we’re going to fail anyway, so we might as well give up now. How many times has that happened to you?

But there IS a solution and here’s five steps on how freight brokers and freight agents can break this pattern of failure and train their mind to never give up:

1.     Stay Focused

Success speaker Tony Robbins says, “Where focus goes, emotion flows. What you focus on – the thoughts you choose – decide your emotions”. When you focus on how challenging your situation is, you’ll feel overwhelmed and frustrated. On the other hand, when you focus on the possibilities, and the rewards of persevering, you’ll feel motivated, excited and ready to work. Stay focused and you’ll finish anything.

2.     Stay Positive

It may take weeks, months or years to achieve your goals. That’s why you must give yourself permission to be happy with making small progress. Each day, focus on doing just a little more than the day before and enjoy all your little victories along the way.

3.     Have A Great Support Network

You’ll have setbacks on the way to your goals – guaranteed. You’ll have setbacks today and this week. The average person has a crisis once every three months! Don’t avoid these challenges and setbacks. Build up a support network of people who’ll assist you when these challenges do come up. These can be other freight agents or just great friends whom you can confide with. Just make sure they’re on board with your goals. When you have a support network that understands where you’re going, it gives you the strength and energy to overcome your setbacks.

4.     Seek Out Ways To Assist Others

When you focus on ‘What can I get’ you tire yourself out. Then you make yourself feel like a victim when you don’t get what you want. Instead, focus on “What can I GIVE”. When you focus on giving and ensuring other people get what they want, you’ll inevitably get what YOU want and feel happier along the way.

5.     Have Faith

Finally, have Faith. Not faith where you delude yourself into thinking that everything will be grand even when you never put in the work. It’s having faith in the process. Again, when you commit to a plan and work that plan every single day, you WILL achieve milestones and victories. Only when you stay with the process long enough and hard enough, is it impossible not to succeed.

5 Ways For Freight Brokers To Deal With Rejection

As you build your freight broker business, you’re going to witness rejection. It’s inevitable. However, as great a freight broker or freight agent as you might be, not everybody wants to deal with you! This is a perfect reason to always be building your contact list.

The rejections freight brokers experience might not be the harsh rejections a door-to-door salesperson may have to endure. However, when people don’t answer your calls, don’t reply to your emails, or tell you not to contact them again, you’re witnessing rejection. This can affect your confidence and your desire to make more calls and contacts.

Perhaps, the biggest indicator of your future success as a freight broker is your ability to tolerate failure and rejection. When you allow rejection to upset you, it won’t be long before you give up on this profession and on your goals. On the other hand, when you learn to tolerate rejection and reach the point where it doesn’t affect you, you become unstoppable. Can you learn to deal with rejection? The answer is absolutely YES!

Here Are 5 Ways For Freight Brokers To Deal With Rejection:

 

  1.  Have a vision and don’t lose sight: As a freight broker, you have a large, compelling and motivating vision for your life, and goals you desire to achieve. It puts rejection into perspective. Remember, that one rejection is just a small blip on a freight broker’s overall journey to achieving their goals. They must take the focus off how challenging the rejection may appear and keep their focus on their vision.
  2.  Focus on the positive: When a freight broker (or anyone) focuses on their challenges, what are they going to get? More challenges! Think about it. Has focusing on your challenges EVER got you what you desired? However, when you focus on SOLUTIONS, what will you get? Solutions and Success in the freight broker business. Successful people are ruthlessly solution orientated. When freight brokers experience rejection, they must pick up the pieces, dust themselves off, focus on their vision and solutions and get back to work with a smile.
  3. What are the lessons you can learn? Rejection is a great teacher. Each rejection and challenge has within it a valuable lesson. Napoleon Hill, author of Think and Grow Rich says it best: Every adversity, every failure, every heartache, carries with it the seed of equal or greater opportunity.
  4. Nothing happens before it’s time:  Accept that it wasn’t right for you at that moment. There’s another saying: Whatever you resist persists. When you accept the rejection and don’t fight reality, the emotion disappears. For example, when it rains, you can resist it by saying: I’m so mad it’s raining. Can’t this rain stop? I’m going to get wet walking to work, which will make my clothes wet, which will make me look unprofessional for the meeting…blah…blah…blah. See how silly this is? By not resisting it, all you would say is: It’s just a little rain. When it rains, you just accept that it’s raining and get on with your day. With practice, you can become as emotionless about rejection as you are about rain.
  5.  Don’ttake it personally: Finally, and most importantly, don’t take rejection personally. You can’t take it personally because rejection isn’t about you! Rejection is not a measure of YOUR self-worth. When someone rejects you, they’re acting out of their own insecurities, doubts and fears. Maybe they’re busy. Maybe they have a lot of stress because their rent is late and the landlord is pressuring them. Maybe it’s raining outside and they just can’t stand the rain! The reality is, rejection has more to do with them, than you. Once any freight broker or freight agent gets their head around this, they’ll have no trouble picking up the phone and making those calls!

Where Is Your Motivation?

For every freight broker and freight agent, achieving your goal in this industry is going to take time.  One day of hard, focused effort isn’t going to be enough.  To get what you desire, you have to put in hard, focused work every single day, day after day, for a long and extended period of time – even months and years.

Like billionaire Warren Buffet says:

“It doesn’t matter how hard you try, it takes nine months to have a baby.”

Every day, you have to wake up and take the steps necessary to get what you desire.  To do this, you’ll have to tap into your motivation.  To have a successful freight broker agent business, it takes a tremendous amount of motivation to get out there every day and make calls, build relationships, and face objections when you ask for the order.  Motivation, however, is a skill you can learn.

Are you a Freight Broker willing to pay the price?

There was once a businessman who made a fortune in the cleaning industry.  On an interview for a TV show, he was once asked “What is the secret of success?”

His reply was:

To become successful, you have to first know what you want, and then determine the price you are willing to pay to achieve it.  If you pay the price, you will achieve your goal.”

Whether your desire is to become a millionaire, or just make a little extra money so you can go on vacation or pay your rent on time, there will be a price you’ll have to pay to accomplish this.

You’ll have to work hard and make sacrifices to keep learning and growing and changing.  Your goal will cost you time, effort and energy!

The question is:

“Are YOU a Freight Broker or Freight Agent willing to pay the price?”

No one else will do this for you.  It’s all on your shoulders and the success of your freight broker business depends on it.

If you’re willing to pay the price, you can accomplish anything you desire.  Most people are not willing to pay the price.  It’s too difficult.  It’s too intimidating and they don’t desire it bad enough.

Even if you aren’t very motivated right now, you can unlock your hunger when you follow these 3 Essentials of Business Success:

  1. Goals

All success in this industry and in life begins with a goal.  Set some compelling goals that light a fire under your belly and get them down on paper.  If you don’t have a written list of your goals, then all you have are just dreams.

  1. Systems

You must follow a proven system if you want to be successful in the logistics industry.  If you don’t take the actions that successful freight brokers take, then you can’t get the results that successful freight brokers get.  Your roadmap to selling more freight includes making 3 new contacts a day and following up with your list weekly via email and phone.

  1. Motivation

Last but most importantly is Motivation.  Motivation is the glue that holds everything together.  It’s your WHY.  As Nietzsche said, “A man with a strong enough WHY can endure any HOW!”.

In other words, it’s motivation that gives you the discipline to review your goals and it’s motivation that allows you to stick to the system.

As a Freight Broker or Freight Agent, if you follow these three steps – and pay the required price – then you can live out your dreams and create an amazing life for yourself and your family!

Best Practices for Renewing Your Freight Broker Bond

If you’re active in the freight broker business, you’ve probably had to renew your freight broker bond these last few summers in order to stay compliant with the Federal Motor Carrier Safety Administration’s (FMCSA) requirement for broker licensing.

Surety bond renewal is an important administrative step that freight broker agents need to take care of, usually on an annual basis. It guarantees that your business meets the legal requirements at all times so your license remains active. Without proper licensing, you risk having your freight broker license revoked and losing your credibility with shippers and carriers.

To make sure this year’s renewal process goes smoothly, here are three best practices that help freight broker agents stay compliant and pay less for their bonding.

Start your freight broker bond renewal on time

Having to stop brokering because you’ve missed the renewal deadline would be a real pain. That’s why it’s a good idea to make sure you stay on top of administrative requirements – and stay in business, unhampered by legal problems.

If you were already brokering two years ago, you went through the FMCSA broker bond increase in October 2013. The BMC-84 freight broker bond was increased from $10,000 to $75,000, a significant raise that changed a lot in the industry. Back then, all freight broker businesses had to either get a new bond with the higher amount or upgrade their bond limits.

As a result, a large percentage of freight agents have to renew their bonds around autumn of each year. If you’re one of them, starting the process in summer is the best approach. With thousands of freight brokers undergoing the renewal process around the same time, delays in renewal are likely, which can jeopardize your license and compliance.

Keep in mind also that even if your deadline seems far away, the bond payment has to be processed a month before the actual expiration of the bond. The FMCSA requires surety companies to send written notices for bond cancellations 30 days in advance. This means that if you haven’t taken steps to renew the bond by then, you might end up with an expired bond. Usually you’ll get a renewal invoice from your surety 60 to 90 days before the expiration, so you have enough time to react and avoid the unpleasant consequences of losing the right to broker.

Fix your financials to get a lower bond cost

Who wouldn’t like to pay less for the freight broker bond renewal? It is definitely possible to reduce your bond cost over the years, and there are a few useful practices in this respect that can save you a lot.

It all starts with understanding how your bond premium is formed. When you apply for a bond, the surety needs to assess the risk associated with providing backing for your business. The more solid your brokerage is, the less you will pay for the bond because you will not be considered a problematic applicant.

That’s why, if you have the chance, it’s a wise step to take care of your financial stats before the renewal. Clearing up old negative items from your credit history, such as liens and judgments, will definitely help to improve the image of your brokerage in front of sureties.

Boosting your credit score is probably the most powerful way to reduce the bond cost. And of course, make sure to showcase the strength of your business in terms of management and finances in general and to stress on the improvements you’ve made.

Look for the best bonding rates – with care

The price you will pay for your freight broker bond renewal is formed on the basis of your credit score and overall finances, but it also depends on the surety agency you will choose to work with. So what are some good practices in this respect?

First of all, if you’re tempted to file bond applications with ten agencies to get a comparison on the prices, think twice. Usually when you apply for a bond, the surety makes an inquiry on your credit. Due to credit card company policies, if you suddenly get multiple inquiries, your personal credit might be penalized permanently and without notice.

Instead of going through all the effort of multiple applications and putting your credit at risk, it’s wiser to avoid shopping around too much, but to focus on making good research of the surety agencies on the market.

The most important tip is to choose a surety provider with years of experience in the field and with a solid reputation. It’s crucial that the agency works only with A-rated and T-listed surety companies because this guarantees the solid backing of your freight broker bond.

Plus, a trustable surety agency would work with numerous bond underwriters, which would mean it has access to the best bonding markets.  Thus, it can shop around for you and find the right bonding rate for your specific case.

With a few handy tips in mind, this year’s freight broker bond renewal should run more smoothly for your business. Best of luck on your renewal journey!

A special thanks to guest blogger, Todd Bryant, president and founder of Bryant Surety Bonds. He is a surety bonds expert with years of experience in helping freight brokers and forwarders get bonded and start their business.

Want to work under LDI’s surety bond? Apply for our authorized freight agent program now!

Apply to be an LDi freight broker agent today!

Recipe For Success To Move More Freight

Just as there are recipes for success, there are recipes for failure.  As a freight broker agent, you’ve done your homework and you’ve tested things during the course of your business that have helped you determine what works and what does not.  For a freight broker agent, a typical day almost always involves having several balls in the air at once.  And when things get busy or you get caught up in the day-to-day minutia of things, it’s all too easy to slip into low gear or take your eye off the prize.  For instance, how many of you have lost sight of obtaining new contacts, emails or phone numbers?  How many of you stopped building your contact list?  Or only send emails rather than use the phone, if you DO make any contacts?  Do you believe that your customers will stay loyal and always work with you?  Do you only service the current customers that you have?  Or maybe you’ve decided to coast and rest on the current flow of business that you have.  These behaviors sound pretty harmless and might even be acceptable to you.  But know this:  If you continue on this path for your business, you are most definitely creating a Recipe for Failure.

The billionaire Charlie Munger has a strategy to discover how to be successful called “Inversion”.  Basically, this strategy means that in order to figure out how to BE successful, you must first ask what it would take to be UNsuccessful.  Freight broker agents  can apply this principle to moving freight as well.  So, according to Munger’s strategy, the following actionables would be a Freight Broker’s Recipe for Success:

  • Obtain three new email contacts and three new phone numbers every day.
  • Call 10 prospects every day.
  • Add to your contact list every day.
  • Use the telephone as much as possible rather than just sending emails.
  • Be aware that your customers will eventually leave at some point, so prepare by adding to and diversifying your contact list.

Remember, this is a minimum.  Following this Recipe for Success isn’t just for when you’re not doing as well or not moving as much freight as you would like.  A successful freight broker would continue following this Recipe for Success even when they don’t have to.  So when the down cycle comes, for example in December which is typically a slow month in the freight sales industry, you’ll be so well prepared with your large and prosperous contact list that you won’t feel any strain.  It’s just like Sun Tzu said, “Plan for what is difficult while it is easy, do what is great while it is small”.

Ten calls a day and 3 new contacts a day is a minimum. Want to get ahead FASTER, then:

  1. Make more calls.
  2. Contact more new prospects.
  3. Diversify your contact list.

When you’re in a down cycle, it’s just as important to keep following this recipe.  During these times, diversify your contact list.  Just as you wouldn’t invest all your money in the stock market in just one stock or bond, don’t put all your hopes of moving freight on just a few prospects.

Getting three new contacts a day is increasing the investment you have in this industry.  When you do this, the result is simple: you make more sales and achieve your goals faster, building an ongoing successful freight agent business.

15 Must-Know Questions Freight Brokers Ask To Move More Freight

The life of a freight broker agent can be very rewarding but not without some challenges.  Calling to find freight is definitely one of those challenges of the business.  Freight agents need to find freight – so you need to make the calls.  Every freight broker knows this.  To add to this…you may be a freight broker agent, but you aren’t really a salesperson.  Your real job is to solve your customer’s freight and shipping challenges.
In order to solve challenges for our customers, we must first figure out:

  1. What are the customers challenges?
  2. What frustrates them?
  3. What do they wish other freight brokers would do that they don’t?
  4. What causes the customer stress?

The answers to these questions can’t be discovered when we do 90% of the talking.  Instead, we MUST ask great questions, and then close our mouths and write down the answers we’re given.  Once we know what their challenges are, and we know that we can assist them to solve these challenges; we can start talking about us.

What Questions Freight Brokers Must Ask The Shipping Decision-Makers To Build A Relationship With Them:

  1.  Tell Me About Your Business?

First off, you should have already googled the company you’re calling.  Ask this question to break the ice.  Good companies love to talk about what they’re doing.  Join in the conversation from the information you already have with them.

  1.  What Are Your Main Responsibilities?

The answer you want to hear is “I’m the Shipping Manager/ Shipping Decision Maker/ in charge of freight here”.  If they’re director of purchasing, simply ask for the name of the shipping manager.  After asking for the shipping manager’s name, ask if you can speak to them.  Once you get to the shipping decision maker, listen carefully to their responsibilities.

  1.  Who Else, Besides You, Makes Your Shipping Decisions?

Your goal is to talk to the person with the power.  Everybody else has problems you can potentially solve, but the person who makes the shipping decisions is the only one who has the authority to let you assist him/her.

  1.  What’s Your Biggest Challenge Shipping Your _______________?

Ask for the biggest challenge shipping their products.  Ensure you write down the answer to this question.

  1.  What Happens When ________________________________ Happens?

This is for locating their challenges beforehand, so you can solve them when they happen.

  1.  What Are Your Main Priorities While Moving Your Freight?

(IE. Price, transit time etc.) Another question you must write down the answer to.

  1.  What Qualities Do You Look For In A Great Transportation Partner?

Your goal is to be excellent in this profession.  Excellent results only come to excellent people with excellent work ethics.  When you know what’s important to them, you’ll ensure them that you’ll fulfil their requirements.

  1.  What Do You Like Most About Your Current Freight Broker?

This question shows that you have class and that you don’t speak poorly of your competition.

  1.  What Would You Change About Your Current Freight Broker?

If they say “I wish they would get their rates to me faster”, then you ensure them that you’ll get your rates to them fast!  With all of the information your prospects give you, write everything down.  By taking action and giving them what their current agent doesn’t, you’ll stand out and be seen as both better and different than their current agent.

  1.  Do You Keep Your Options Open For Transportation Partners?

This is one of the main questions you MUST ask.  This question qualifies your prospect.

  1.  What’s Your Criteria for Bringing in a New Freight Broker?

Some may have criteria, some don’t.  Overall, their criteria is for you to solve their challenges.  When you go to them with your solutions, you break their autopilot and comfort zone and they won’t be able to help but listen to you.

  1.  How Do You Measure Success With Current Freight Brokers?

The main way is that their freight broker gets their freight picked up, transported and delivered on time.  But always see if you can go deeper for other answers and insights.

  1.  How Would I Win Your “Freight Broker Of The Year” Award?

They might be reluctant to answer or tell you they don’t have an award like this.  Use the phrase “But if you did have an award, how would I win it” to give them permission to open up and tell you what is most important to them.

  1.  What Lanes Are You Shipping Right Now?

Remember, success on the telephone goes to the person with the best notes.

  1.  What’s Your Email Address So I Can Send You My Information?

You MUST ask this question every time.  We’ve already shown we’re interested in them and gotten to know their requirements.  Don’t forget this final step where you capitalize on all the work you’ve already done.

There are countless other questions a freight broker agents could ask a customer/prospect.  The above questions are a great starting point to engage them and find the answers that will not only serve to develop a relationship but help you be THE freight broker agent they choose to solve their freight and shipping challenges.  Now, it’s up to you to ensure they’ve made the right choice and turn them from a good prospect into a great customer!

10 Ways Freight Brokers Can Generate Leads

Lead generation is a difficult and time-consuming task but the success of your business hinges on identifying new prospects and attracting them to what you have to offer.  The ultimate goal for your freight broker business (or any business) is to generate more leads to convert into customers so your business will grow.  The suggestions below are designed to help freight brokers fill their sales lead pipeline.  The more leads you have in your pipeline, the more prospects can be converted to customers which means more money for you and your freight broker business to grow and prosper.

Here are 10 places freight broker agents can generate leads to grow their business:

1. Start with people that you know – your current contacts:  Ask friends and family where they work.  Not every company requires shipping, but many do.  A freight agent’s current contacts are a great source for leads, and once you get a lead inside an industry you can prospect other companies in the same industry.

2. Keep a notebook in your car/truck:  You can write down names of companies you see on the road.  Write down the company, any nearby landmarks, and any other information you can use to establish rapport during your conversation.

3. Referrals:  As you get more customers and build a reputation, they will refer other customers to you.  Companies that you’ve picked up from and shipped to are another good source, but wait until after the shipping is complete to contact them so you have success under your belt.

4. Companies in the same industry or companies you work with:  When freight brokers tell companies they specialize in produce or lumber, they will establish expertise in the client’s eyes.  Check shipping labels on produce or food for information on how they are shipped.

5. Check customers’ credit reference sheets for new leads:  Mention that you were referred to them by the customer.

6. Go to Thomasnet.com:  Start calling the customers on their list.  There are 10’s of thousands of them.  If you’re not comfortable with this, pick an industry you are familiar with and start there.

7. Look at where current loads are picked up or dropped off:  Call these places.  Usually they will tell you they do not have any loads that need to be moved, but if you are persistent, you will find they have loads that need to be moved.

8. Research the destination of your current loads:  Companies in these cities will have loads to be moved, and know that they will get a better rate if you are already shipping to their city.

9. USDA produces a valuable resource at MarketNews.usda.gov:  This can be a great resource for freight brokers and the prices and freight information are updated every Wednesday.

10. Go to ProduceMarketGuide.com:  This has regularly updated information on produce.  CareersInFood.com also has resources about food manufacturing.  Manta.com gives in-depth information about companies, including email contacts.

These are just a few ways that freight agents can find new prospects but the ultimate success of your business depends on your actions.  To be a successful freight broker agent, you must continue to put in the hard work of introducing yourself, your freight broker business and your services to new prospects regularly then continue that momentum by building relationships, stimulating referrals and finding additional opportunities when possible.  Your reward will be a thriving pipeline that will skyrocket your business at high-times and help to carry you through slower times.  Just like solidifying any good habit…lead generation cannot be a one-time activity but rather a way of life.