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How To Select A Reputable Freight Broker

by dannyadmin on October 20, 2014

A freight broker is a person/firm that acts as a liaison between companies or individuals in need of shipping services. Despite being an intermediary, a freight broker offers essential services to shipping companies and their clients. For instance, a shipper can use a broker to access more clients without necessarily having to worry about establishing and managing new relationships. However, selecting a reputable freight broker can prove a challenge. With that in mind, here are some tips to get you started:


Federal law requires any person acting as a shipping broker to have a property broker license. The only body tasked with issuing these licenses in the US is the Federal Motor Carrier Safety Administration (FMCSA). Broker licenses usually have a letter “B” while carrier licenses have a letter “C.” Still, some brokers have both “B” and “C” licenses, which means they provide both services. To be on the safe side, you should avoid brokers who do not have the relevant license.


Choose a broker who has adequate insurance coverage. Most brokers carry contingent cargo insurance to pay for damages in the event a shipper or its insurer refuses to pay. In addition, reputable brokers carry liability as well as errors and omissions coverage. If a broker does not have coverage, take your business elsewhere.

Background Check

Before trusting a freight broker with precious/expensive goods, carry out a background check on his/her activities. To start with, run a credit check on the broker you intend to hire. The general rule of thumb is to select a financially solvent broker. This means a broker who pays carriers on time, does not have substantial outstanding debts, and has a good credit score. Be wary of brokers with financial problems. Secondly, run a background check on your broker including any complaints filed by past clients and how the broker handles unsatisfied clients. Luckily, you can find such information by visiting the Better Business Bureau (BBB) website.

Carrier Selection

Request your broker to furnish you with carrier selection details. Then, go through the information provided carefully to ensure you do not get a raw deal at the end of the day. For instance, a reputable and experienced broker will only work with carriers who have stellar safety rating, FMCSA licensure, as well as proper insurance coverage. Take note some brokers use electronic posting services to find available capacity. These services allow brokers to post available loads and carriers to post available capacity.

Active Member of Reputable Association

Select a broker who is an active member of a reputable trade organization or association. A good example of such a body is the Transportation Intermediaries Association (TIA), which requires its members to abide by a strict code of ethics. Another reputable body is the National Industrial Transportation League (NITL). This does not mean a broker who is not a member of any of these bodies is untrustworthy. Consider the factors described above before making your choice.

All in all, freight brokers serve as a link between carriers and clients who require shipping services. Some of the important factors you should consider before hiring a freight broker licensure, carrier selection process, and insurance coverage. Furthermore, your broker should be an active member of a trade organization.

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