US Ravens Logistics

logo

  • Track a Shipment

  • Agent Portal

    Log In


Different types of freight brokers

What Are Different Types of Freight Brokers?

Today, freight brokers are core players in the logistics industry. As logistics operations grow, it takes a lot of work to ship loads from one place to another on your own. This is where a freight broker can help businesses manage the complex task of shipping the load to their destination safely and securely. In this blog, we will understand what a freight broker is, their responsibilities, and the different types of freight brokers.

What is a Freight Broker?

Freight brokers are crucial in connecting shippers with carriers. They help bridge the gap between shippers and carriers to ensure seamless transit of goods across various transport modes, be it by truck, rail, or sea. They act as a link between shippers who need to ship their goods and carriers who can transport their goods.

Further, from helping small businesses ship cargo efficiently to carefully managing the freight deliveries of large companies, freight brokers are responsible for swift and timely freight delivery.

What is the Role of a Freight Broker?

A freight broker can help businesses save operational costs by bargaining for better prices. They are also responsible for keeping records up to date, sending quotes to different carriers for the best price, handling loads, and resolving any issues during shipment delivery. Let us see the primary duties of a freight broker in detail.

Handling of Loads

Freight brokers expertly manage load handling. They skillfully match available carriers with shippers’ cargo requirements, ensuring seamless transportation of loads.

Build Strong Partnerships with Customers

Cultivating solid, long-lasting relationships with clients is paramount for freight brokers. They actively collaborate with shippers, gaining in-depth knowledge of their unique needs.

Negotiating Favourable Rates and Contracts

Freight brokers navigate the complexities of carrier pricing and leverage their knowledge to negotiate and obtain the best market rates favorable to their customers. Ultimately, this leads to reliable and cost-effective service, maximizing value for shippers.

Provide Real-Time Shipment Information to Shippers

Ensuring cargo visibility in real-time is a critical responsibility for freight brokers. They employ advanced tracking systems to monitor shipments, providing customers with up-to-date information on location, status, and estimated delivery time.

What are the Different Types of Freight Brokers in Logistics?

Freight brokers can be of different types based on their classification. Some freight brokers can be classified based on assets, while others can be classified based on the type of technology they use for communication. Let’s take a closer look at each type of freight broker:

Type 1: Asset Based Classification

When we classify freight brokers based on assets, there are two types of freight brokers – asset based and non asset based. The former work with companies that have their own fleet of trucks and other transportation assets, while the latter work with those who don’t have any assets. Let us briefly go through them:

  • Asset Based Freight Brokers

Asset-based freight brokers are part of 3PL logistics company that owns and operates trucks, different trailers, and other transportation assets. Having their own trucking assets allows them to offer clients a complete service by combining their in-house transport capabilities with their brokerage services.

It gives them direct control over drivers and equipment. This means asset-based brokers can be flexible in managing shipments to ensure reliability and coordination between pickup and drop destinations. Through this integrated arrangement, they can control the movement of the supply chain and provide shippers with a more efficient, streamlined service.

  • Non Asset Based Freight Brokers

As a non asset based freight brokerage, brokers are part of a logistics company with no assets of their own. Instead, they partner with carriers or truckers to ship on their shipper’s behalf.

Non-asset-based brokers are skilled at finding suitable and available carriers. They focus on matching loads quickly and managing the entire logistics supply chain, which allows companies and operations to scale quickly.

Type 2: Technology Based Classification

Many digital freight brokers use technology to find and book loads. While brokers who follow traditional methods use traditional methods such as personal relationships with truckers and physical load boards to book a load. Let us look at both of them in detail.

  • Digital Freight Brokers

Digital freight broker leverages technology and online platforms to streamline the brokerage process. To find loads they use load boards like DAT, Truckstop, etc. that employ load-matching algorithms for real-time shipment tracking and create digital marketplaces to connect shippers with carriers efficiently.

Such freight brokers use digital onboarding to onboard new carriers. To send rate confirmation to the trackers, they first create the loads digitally and send them the rate confirmation via email. This helps speed up the onboarding and load assigning process, saving time that is very crucial in logistics. Since they use technology, such brokers can provide services across the globe.

  • Traditional Freight Brokers

Traditional freight brokers operate based on personal relationships, industry knowledge, and manual processes. It means that they will use their personal relationships and traditional physical load boards like DAT to get loads and then contact their established carrier networks to find carriers for the same load.

Although such brokers are not as tech-savvy as digital brokers, they have deep expertise in the industry, personalized touch, and the ability to handle complicated shipments. They limit themselves to specific regions/commodities of transportation.

Conclusion

Choosing a suitable broker is difficult but necessary for your business. Depending on your load needs, you can choose either asset based freight broker or non asset based freight broker. Also, if your load is time sensitive, you can hire a digital freight broker to work with a logistics company that can fast-track the process of your shipment pickup and delivery.

Tags:

Leave a Comment

Your email address will not be published. Required fields are marked *