New Freight Broker Bond Is Law – What Do You Need To Know?

Since the Federal Highway Bill was passed the amount you need to be bonded for has increased from $10,000 to a hefty $75,000.  The increased amount is geared to help weaken fraudulent activity within the freight brokerage industry.  However, this now means that getting a company to back you for the necessary amount will require stricter application guidelines and could prevent many small brokers from getting bonded.  As a freight broker you are required to purchase a surety bond for your business so it’s important to know exactly what it is and what you need to obtain it.

As was mentioned, surety bonds help regulate the freight brokerage business and reduce potential financial losses for affiliated parties.  The surety bond acts as a kind of insurance, except where most insurance contracts bind two parties together, the surety bond brings three separate entities into a binding contract.  There is the “obligee” that requires the bond; this is usually a government agency that regulates the industry.  There is the agency that issues the bond and provides a financial guarantee of your business’s ability to follow through on the agreed upon contract (this is the surety).  And there is the actual individual, or business, that is required to purchase the bond called “the principle”.  A freight broker falls into the “principle” category.

As the principle you should know that not all bonds are the same and each will be evaluated differently depending on the applicant.  Surety bond applicants will be evaluated on several pieces of information such as credit score and personal and business financials.  Because every applicant will have different information and credentials not everyone will receive the same rate on their bond.  Also, depending on which bond you apply for can determine the amount or type of risks the surety company will take on.  One of the major risk a surety company considers is that the principle will default and the surety company will have to pay the bond amount to the obligee.  So the lower the risk on the surety bond, the lower the cost.  You can get bonded for $75,000 at minimum or if you want to get more coverage you can apply for a larger bond.  Many top freight brokerages carry a bond of $250,000.

Standard surety bonds rates range from 1-10% of the bond amount.  Bonds deemed to be high risk can cost as much as 20% of the bond amount, while others might even require some sort of collateral be given along with the premium.  Whether this has to be done or not is determined by the Surety Bond Underwriter (SBU).  The SBU is the person who reviews the application and decides the risk being presented to the surety company.  This can vary from one individual to another since every provider gauges risk differently.  Ultimately, the surety body underwriter has the authority to accept or deny high risk applicants.

When applying it’s important to have your paperwork ready beforehand.  You can work to have this ready by first contacting the agency or obligee that is requiring the bond.  In the case of the transportation surety bond this would be the FMCSA.  They can help you better understand what bond form you will need.  You can obtain the exact form you’ll need from most surety companies, but accessing the form upfront will save a lot of time.  It’s also important that all your personal and business records are easily accessible. You will need the name of your business, the penal sum (bond amount) and social security numbers and addresses of all respective owners.  This is information that the bond underwriter will need in order to consider your application. Knowing what the surety providers expect will allow you to be prepared and help the application process run smoothly and as favorably for your business.

Surety bonds are not always cut and dry but knowing the proper vocabulary and preparing yourself with the right information and documentation can make it a lot easier.  If you are looking for a freight agent job you can hire on with a company that already has a bond.  If you want to establish your own freight brokerage you will need to follow these guidelines and make sure you obtain the proper coverage for your business.  If you have additional questions reach out to the appropriate government agencies or a credible freight brokerage program that can give you the necessary information to decide which direction you want to take your company.

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Mind Food: A Freight Agents Guide To “Intelligent Eating”

Freight Agent EatingYou know that old saying, “You are what you eat?” Well it reins true and chances are you’ve felt the effects of a poor diet. It’s pretty widely accepted that if you eat a healthier diet your body will become, well, healthier. But what impact does your diet have on your mind and your ability to problem solve?

More than you might think. More than you might care to think about. But it something that should be considered because this concept can be especially important when it comes to work.

A friend of mine is a freight agent and is frequently expressing his continuous fatigue and inability to think as clearly as he would like.  So, like any concerned friend would, I decided to see how I could help my pal.   I did some research on how diet relates to mental performance, compiled a short list of brain foods, and gave it to my friend.  The list below identifies foods that my friend says have helped him! They are easy to find foods you can use to promote clear thinking and increase energy.

Tea:
Skip the latte and grab a tea! Green and black tea are great for your brain because they’re full of “catechins”.  According to the Journal of Physiology there is a link between catechins and physical performance.  They are also responsible for keeping your mind sharp and may be able to counter balance those drained or lazy unmotivated feelings.  Some people even say they’ll help you lose weight!

Whole Grains:
Whole grains are great for your body however; they’re also great for your brain! Whole wheat, bran and wheat germ contain folate as does brown rice, oatmeal, and other whole grain items.  These whole grain foods increase blood flow to the brain which means heightened brain function.  Grains also contain vitamin B6, which is full of Thiamine. Thiamine is good for anyone trying to improve their memory.  Take some and you’ll remember to take some!

Curry:
Put some spice into your life!  Curry is a good start.  Curry powder contains curcumin which is full of antioxidants that help fight against an aging brain while maintaining cognitive function.

Nuts:
If you have a pressing job like my freight agent friend, then don’t skip snacks! It’s important to feed your brain throughout the day in order to stay in your best mental state. So, go nuts!  All nuts and seeds are good for your brain and good for suppressing that hunger pain.  Nuts and seeds are full of fatty Omegas as well as other important nutrients that act as antidepressants.  Who knew nuts can keep you from going “nutty” and getting sad?

These four foods are great for keeping your brain in tip top shape.  Leafy green veggies, berries and dark chocolate also have beneficial effects on brain power as well as make for a healthier overall diet. They’re pretty delicious too!  Start feeding your brain the right things and you will reap the benefits.

Till next time, Liv Well!

*Liv Well is not a registered health practitioner.  Her blogs and comments do not necessarily represent the opinions of, and are not endorsed as right or wrong, by the owners of this blog.  Consult a doctor or registered medical specialist before experimenting with any health product or food to know how it may affect you.

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Summer…Even For A Broker? How To Avoid Sun Remorse

Transportation Agent

Transportation Agent Getting Sun

Summer’s here! That time of year when the days get longer and the recreational activities seem endless.  While there is plenty to do and enjoy during this season, many will be cooped up in an office throughout the day, missing all the fun in the sun.  However, work must go on right?  If you’re a transportation agent busy in the office there are still ways to avoid sun remorse and participate in all the season has to offer.

A freight agent often has the ability to work from an office right in the comfort of their own home and can determine their own schedule.  While some freight brokers have the same setup many actually work in an office for a larger, fully staffed logistics company.  Both options have their pros and cons but no matter which category you fall into you’re probably sitting inside behind a desk feeling like the sun is just out of reach.  For those of us dying to get out,  here are a few ways to get your work day sun fix!

1.  Let the sun shine. Position your desk where it has better access to the sunlight; or open windows around your house or office letting in the warm breeze.  This will create a comfortable outside effect so you don’t miss out on the summertime ambiance.

2.  Don’t just take a break, take a sun break. Find an area outside where you can create a space for breaks during your day.  Add a chair or blanket, bring a magazine and don’t forget your container of iced tea! Creating a summer break area will give you a chance to make up for lost summertime relaxing, and can be a fun way to get your dose of sun during the hours that you’re at work.

3.  Bring summer inside. On your way to work, you might want to pick some wild flowers to put in a vase on your desk, or stock up on seasonal fruit and cold treats for lunch. This along with that summer breeze floating inside will be sure to create a summery atmosphere while you work.

Being a transportation agent is great because of the ever changing duties and fast paced environment.  It’s not always easy to steal a few minutes away from the office but as a logistics professional it’s in your nature to make it work.  You don’t want to miss out on the summer season so making small changes like those mentioned above can make for a more enjoyable work day.  Summer only comes once a year, make the most of it!

Check out these links to some cool summer drinks:

http://allrecipes.com/howto/summer-sips-refreshing-summer-drinks/

http://www.bhg.com/recipes/drinks/seasonal/summer-beverage-recipes/

http://www.cookinglight.com/food/in-season/cool-summer-drinks-00400000001113/

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Freight Agent Balancing Act: Managing Work & Personal Life At Your Home Office

Freight Agent Office

Freight Agent Working From Home Office

As a freight agent or transportation broker working from out of your home office you probably understand the intricacies of balancing a successful home-based business with the domestic issues you find yourself engaged in.  Amongst these challenges is finding the most effective way to accommodate the needs of your patient and loving significant other during the course of the day.  We all know he/she only wants the best for us but sometimes it’s difficult to keep our work and personal lives apart which can put strain on both relationships.  This means it’s important to use certain strategies to achieve the ideal work and family balance.

A good place to start is by making your work space as distraction free as possible.  The fact that we can work from home is one of the big perks to being a freight agent but make sure your work space is away from areas where others in the house are watching TV, listening to music or participating in any other noise producing activity.  This is your office; so make sure your work space incorporates the elements required to perform your necessary duties like any other work office.  You may risk missing key details on a load or simply forget a pickup if you aren’t able to hear your customers or aren’t fully present during the conversation.  These are errors no agent wants to make so put some real thought into the location and design of your work space.

Knowing what you require during the day to be successful and clearly communicating this to your significant other is essential as well. Be consistent with the boundaries you set for your family so everyone can accommodate you during those working hours.  A good way to do this is to have scheduled breaks; this will provide times where you can give your full attention to family matters and address issues without interrupting the business your doing.  Remember to be consistent with the times you allot for non-work related things as this will help you form quality relationships at work and with your loved ones, by giving each party your undivided attention.

You should also consider doing your best to have a consistent start and stop time.  We all know every type of freight broker is on call 24 hours but for an agent working from home it may be especially important to find a way to stop non-urgent issues from interfering in your work or personal life.  Clearly define what is urgent and non-urgent and do your best to stick to those rules.  It will be very helpful if your family understands how important a phone call can be to your business and the family budget.  Explain what you do in detail and tell them what your customers require from you.  Likewise, ask your family what they need from you as if they were your customer and work to accommodate both parties as much as possible.  Simply discussing what each group needs will help those you love the most understand why you may have to allow your business special attention during non-business hours.

Attention along with good communication centered around a clearly defined schedule will provide a good foundation for keeping all the people in your life including your customers, carriers, and cutie pie/stud muffins as happy as possible.  But every office and family operate a little differently.  Figure out what works best for you and your family and apply those strategies in a consistent way throughout the day to ensure a more successful working environment.  While you can’t eliminate all distractions that come from your family during the day, know your bottom line requirements to be a successful freight agent and enforce a plan.  Implementing these tips will help you achieve that perfect work and family balance.

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Experienced Freight Brokers and Agents in High Demand

From the food we eat to the clothes we wear, commodities are constantly being transported around the globe to fill our ever increasing demand for consumer goods.  As the need for different products and services increases so does the need for freight brokers and agents.

Over the last decade the world of transportation has undergone some significant changes and there has been a shift away from the traditional shipper-carrier model (when a shipping company would go directly to the carrier to supply trucks, or capacity as it is referred to within the industry).  As shippers have moved away from this they have begun to look at the solutions third party logistics (3PL) and freight brokerage companies can provide for not only their capacity needs but for consultation services addressing their entire supply chain.

This change has led to growth for 3PLs and freight brokerages which has increased demand for experienced freight brokers (individual who work inside a transportation company as an employee) and freight agents (people who contract with an established logistics or transportation company who have their own, usually smaller, freight brokerage).  According to industry statistics provided by Armstrong & Associates, a well-known supply chain consultation firm and research provider, the 3PL industry has seen positive growth almost every year since inception and a 5.2% increase year over year 2010-2011; well above most other industries in the same period.

As transportation and logistics companies seek to hire more qualified individuals they are looking for people who have a proven track record for increasing sales, customer service, and a broad knowledge of transportation and supply chain topics.  Many companies are looking for people currently working in these fields and are competing for the best individuals by offering a better reputation and support system.

However, there is opportunity to break into the industry without experience.  Most positions available that do not require experience are freight broker or account manager jobs inside established companies.  This is often a great place to begin before considering if it would be appropriate to branch out and either start your own freight brokerage firm or become your own boss by jumping into the freight agent role.

No matter what your level of experience strong personal drive and self-determination are recognized as key components of the career that set proficient freight brokers and agents apart from those passing through.  These characteristics are especially important to potential employers because it is not uncommon to see people enter the industry with inflated hopes of high payouts from little effort when in fact the duties of a freight broker can be demanding and require substantial work ethic.  Both brokers and agents put in a lot of hard work before they start to see their wallet fattened.  But a good freight broker is willing to spend time making the connections and clients they need to build a strong customer base and realize a better than average income.

The statistics show the industry is growing and becoming more popular each year.  The solutions a 3PL or freight brokerage company can offer shipping companies have been proven to add considerable value that is being sought after by major corporations.  As the market continues to support logistics and transportation companies with a more complete supply chain management model, demand for qualified, experienced sales associates will continue to grow and provide a challenging but lucrative position in the transportation industry.

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Freight Brokers Watching As Transportation Bill Receives Extension

All year long freight brokers and freight agents have been anxiously watching as the federal government attempts to reach an agreement about future transportation regulations and funding.  Today was no different as the industry braced for the possible end of funding for highway transportation and infrastructure projects all across the nation..

With only two days left to vote, the House of Representatives passed a stop-gap measure that will extend funding to numerous major transportation construction projects without directly passing the controversial Highway Transportation Bill, a convoluted bill posed as the solution to transportation and highway rules and funding issues.  Transportation agents are specifically watching this bill because it contains a provision affecting the bond limit all freight brokers will be required to have going forward.

With the expiration of the most recent extension of SAFETEA-LU (the previous bill regulating highway and transportation infrastructure projects) in sight, the government was working to create a permanent plan for transportation related projects.  Earlier this month the Senate made a big leap by passing the bi-partisan Highway Transportation Bill.  The Highway Transportation Bill is designed to keep transportation projects going for the next two years and provide funding of over $109 billion dollars during that period.  It also includes language that will increase the freight brokers bond from $10,000 to $100,000.  An increase that threatens over 17,000 freight brokerages across the country.

After passing in the Senate, the bill went before Congress to receive the confirmation vote.  The House had until March 31st to vote on the new bill or face the real possibility of federal funding running out for major projects nationwide.  With so much debate surrounding the many provisions of the bill, Congress was unable to come to an agreement.   As early as last week, the House Transportation & Infrastructure Committee Chairman John Mica (R-FL) reported the House would be proposing a 3 month extension, or stop-gap measure, that would continue funding for highway and infrastructure projects but not pass the extensive Highway Transportation Bill.

With only two days left before the deadline, the House put the stop-gap measure to vote.  Earlier today, the House voted 266-158 to pass the measure keeping state projects funding intact past Easter and through the coming 2 months.  The Senate signed off on a parallel bill by voice vote to move the bill to President Obama’s desk.  The President is expected to sign off on the extension early tomorrow morning.

The Highway Transportation Bill, a bill that contains a number of provisions that will affect the transportation industry, notably for freight brokers and freight agents the $100,000 broker bond, will continue to be scrutinized in the coming months.

With a new vote pending in the second quarter the bill will either becoming the new funding and infrastructure plan directing all freight brokerages to hold the new bond or be voted back down to Senate for revision and continued debate.

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Getting Candy Corn to Your Candy Bowl

Halloween officially marks the beginning of the holiday season. Consumers begin a three month spending spree on food and gifts, and retailers wait anxiously to bounce out of the red. Items fly off the shelves by the case load, forcing trucking companies to work overtime to ensure retailers have all the products they need to satisfy their customers. Especially their ‘sweet tooth’.

What symbol could be more representative of Halloween than Candy Corn? The little triangle-shaped, multi-colored, dried corn kernel replica candies that dominate Halloween candy aisles seem to be in everyone’s candy bowl. But the process of getting the candy corn from the manufacturer to the consumer is a fairly long one that requires punctual deliveries and complicated exchanges.

First, the candy begins, as any other edible good: in a large mixing bowl at the factory. Over recent years, robotics and advances in technology have drastically altered the look and feel of modern factories, replacing thousands of human laborers. Nowadays, many factories are almost completely automated, capable of producing huge amounts of product. In fact, it’s estimated that over 35 million pounds of candy corn, or 9 billion pieces, will be made this year.

Workers begin by mixing sugar, water, and corn syrup in large kettles, then add fondant (a sweet, creamy icing) and marshmallow for texture. A batch is made and poured into molds. Then a machine pokes a hole in each candy, inserting white, yellow, and orange food coloring. After cooling (approximately 24 hours), the molds are emptied and the candy falls into chutes where they are lightly covered with a glaze for shine.

The candy corn is weighed according to the company’s specifications then packaged and boxed for shipment. From here, the company will get in contact with a carrier capable of transporting their product to the retailer. It is also possible to work with a freight broker to facilitate the transportation process. A freight broker acts as a kind of liaison between the company doing the shipping and a carrier willing to carry the load. They work with the shipper to determine their needs, and then find a carrier from his or her list of contacts matching those qualities. A price is negotiated, of which the freight broker receives a percentage commission.

There are also many stores and online companies that will purchase product directly from the company to sell to the public in bulk or at wholesale prices. In this case, they will procure their own means of transporting the candy to the consumer, whether their own carrier service or by use of a freight broker.

The containers are loaded and the trucks carry the candy to the retailers, who either immediately replenish their shelves with fresh product or increase their own back room inventory for when the number of units on the floor begins to dwindle. Inventory systems such as Just-in-Time and FIFO (First In, First Out) automatically track, via computer, exactly how many units of the candy have been sold and will alert the purchasing manager when it’s time to buy the next shipment of inventory.

Happy Halloween. Are you an active freight broker?  For new opportunities to advance your career as a freight broker just click here for information.

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How Much Can A Freight Broker Make?

One of the most common questions I get from freight brokers is “How much can a freight broker make?” My answer is almost always the same, “It depends.”

Generally Freight Brokers can make very good money. I have seen many make hundreds of thousands a year, but I’ve also seen a few make next to nothing. The wonder of the profession is that there is no cap on what a person can make. You are only limited by the amount of business you can do. Therefore if a person is dedicated, hard working, and skilled in business and as a salesperson they can make much more money than many other professions could provide.

From my experience I would venture to guess that the average established Broker makes between $100,000 and $150,000 a year. That’s not bad for a profession requiring no college degree, certifications, or state exams. Among startup opportunities out there it is also one of the most affordable. A brokerage requires very few costs for startup.

So how does a freight broker make all this money? It’s pretty simple, really. When a company wishes to move a load of freight from one point to the other, he will pay for it to be moved. When a shipper uses a broker, he pays the broker to move the freight, only the broker does not actually move the freight, but rather possesses the contacts and resources to find the right person to do the job. The broker turns around and pays a carrier a lower price to move the freight than what the shipping company paid the broker. This difference is called a “spread” and is the broker’s margin or profit once operating expenses are paid for.

So if you charge a company $2,000 to move a load, and pay a carrier $1,850, you will retain a margin of $150. Each load will vary, but the current industry average spread per load is probably somewhere around this figure. Now is the most important factor that decides how much a broker makes. How many loads can you move per week? Most getting started out will move about 1-5 loads per week, once established you might move something like 5-10 or more loads each week. You will see that your annual income as a Freight Broker, then will vary directly by the number of loads you move.

For example, if a person moves an average of 5 loads per week at $150, it will amount to about $39,000 each year. If you move an average of 10 loads per week at the same margin, you’ll be making around $78,000 per year. It obviously would continue up from there.

One thing to keep in mind is that no one ever moved a load without knowing how to and being familiar with the transportation industry. If you hope to be successful as a freight broker you will need either experience in the transportation industry, an education in freight brokerage, or preferably both. A few excellent freight broker schools have been established to teach students exactly how to be successful.

Educate yourself on possibilities, learn how to broker freight if you do not already know how to, and get to work. It is an extremely rewarding and lucrative industry to get started in. Check out salary.com for more information on broker incomes.

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Freight Broker Training: Finding Freight

intermodal freightHere is a little freight broker training tip. We hope you find this information helpful.

As a freight agent or freight broker, moving loads is the most important aspect of your job. It is also the most challenging thing a broker needs to do, once freight is found and the job won, the rest is quite simple. Here are a few suggestions that might help you get started finding freight, or if already established, to help you find more or better paying freight.

Most established brokers do little cold calling unless they are really trying to grow the business. Those who have a considerable book of business get most of their loads from existing customers or as referrals from customers. This works great as long as you keep your customers happy, which include shippers and carriers. Providing superior service and really value added, instead of just taking money for being the middle man, is the way the most successful companies have gotten to where they are.

Many people utilize internet load boards to find carriers and loads to move. Many load boards now days are free, at least for some of their services. Load boards can be a threat to brokers, as they have the tendency to allow shippers and carriers to connect directly, without the need of a broker, but there are still many instances where a freight intermediary is preferred, especially if you can provide a valuable service.

Other, less obvious sources on the internet can also be useful. Use search engines to find lists of companies and contacts, whether by industry, geographical location, specific shipping need, etc. Often the niche and specialized corners of the industry will have less competition (where the transportation industry is already fiercely competitive) allowing you to specialize and pick up a lot of business.

Target smaller companies. Large companies will either have their own transportation department and possibly even their own trucks, or will already have an established relationship with a larger brokerage. You won’t stand a chance at getting those accounts, especially if you are just getting started and don’t have a considerable reputation and book of business.

Doing these things, as well as using your head, getting creative and trying to find those companies that may not be getting 40 calls a day. Most of all just work hard and be sure to make the customers you do land happy. If you do this, you will maximize your chances at success and your bottom line while you’re at it.

If your looking for freight broker training visit http://www.FreightBrokerageSchool.com today.

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Getting Started in Freight Brokerage – Setting Up Your Business

Before you go about filling out the forms and applications for your Broker Authority (Freight Broker License), you need to make sure you have a business entity set up and ready to go. This can be a rather daunting task, but can actually be quite simple if you take a little time to educate yourself and just get it done.

First of all you need to decide on a form of doing business. You have several different options here. Your choice should depend on where you see your company going in the next several years. What about 10 or 20 years down the road? Are you going into business alone? With a friend? Do you plan on expanding or hiring other freight agents? These questions, among other considerations, will help you decide how to go about starting your business.

A corporation is probably the most desirable of all forms of doing business, as it separates your assets (as an owner) from the assets of your company. This means if something goes terribly wrong and someone wants to sue your company, they can take money from the company, but in most cases cannot take any money or assets from you (your house or bank account, etc.). As a freight broker, dealing with large trucks and potentially very valuable cargo loads, this is very desirable for you. The drawbacks to incorporation for your company are somewhat more rigorous regulation and complicated tax law. It is also somewhat more difficult to become a corporation, as there are more steps and complicated application process. The time it will take is worth it. An alternative from a corporation is an S Corporation, which carries most of the same benefits as a Corporation, but is designed for smaller companies still in need of incorporated status.

Less desirable than a Corporation and S Corporation, but still relatively safe, is a Limited Liability Company (LLC). An LLC offers similar liability protection, where liability for the company does not generally extend to an owner’s personal assets; it is limited to assets in possession of the company. An LLC can be desirable especially for those not planning on sharing ownership of the company or expanding too much.

Sole Proprietorships and Partnerships should be avoided if possible, as these forms of doing business do not offer protection of personal assets. With these your house or anything else is fair game to satisfy company debts and legal liabilities. The one thing they do have going for them, is that they are relatively easy to set up. But setting up an LLC or Corporation is well the small additional effort required. If you do choose to set up a partnership, be sure to draft a thorough partnership agreement. Too many partnerships have gone sour because of unclear agreements and misunderstandings among partners. A clear legal agreement can go a long way to remedy this.

If you plan on using a business name other than your own name, you will need to check to make sure that that business name is not already taken. Once you are sure your desired DBA (Doing Business As) name is not taken, you can register it with the appropriate authorities.

This is intended as a general overview, not as a thorough or exhaustive guide. The information listed here may not be correct, as laws and regulations vary from state to state and county to county. Though most of this can be done without the aid of an attorney, it may be wise to consult with an attorney in your area.

If you or someone you know is interested in freight broker training there are many resources available at http:// www.inboundlogistics.com.

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