From working with a carrier directly to using online load boards, there are more options than ever to help shippers put their freight in motion. Yet, the advantages of using one of the most tried and true of these options, the freight broker, may be largely unknown to some shippers. So, to set the record straight, we sat down with a real-life freight specialist – Bulk Connection’s own Truckload Division Manager for 30 years, Scott Wilson – to answer the question: what does a freight broker do to add value for shippers?
What is a freight broker?
A freight broker is a licensed property broker that uses its network of carriers to transport shippers’ freight – and much more. This “much more” includes helping shippers to cut costs, move freight fast, and remove the demands of traffic management and carrier sourcing from its operations.
So, in that respect, the term “freight broker” feels a bit antiquated nowadays. We’re third-party logistics providers (3PLs) that perform a lot more on the shippers’ behalf than simply moving product from points A to B. Anything from drayage and arrangement of customs details to manufacturing logistics and just-in-time delivery can be included in our services. Not to mention the human component of communication and negotiation for cost savings.
What advantages do freight brokers provide for shippers?
Cut freight costs. Most freight 3PLs have very large networks of carriers. A 3PL can leverage the size of its network to find the best carrier for a shipper’s load based on experience, equipment and cost. 3PLs can essentially ‘comparison shop’ on behalf of their shipping customers.
Move freight fast. Again, the large size of a 3PL’s carrier network allows for greater flexibility in meeting the timelines of shippers. From there, communication is vital to iron out schedules that work for shippers and destination facilities. We can also factor in stops to tank washes and other items.
Remove demands of traffic management. When a shipper books a load with a carrier, that shipper typically must allocate internal resources to track that load and manage the timeline and stakeholder expectations. Brokerages can handle those tasks on the shippers’ behalf.
Provide multiple transportation modes. Some 3PLs, like Bulk Connection, that specialize in bulk freight shipping can handle transportation across just about all trucking modes – e.g., liquid and dry bulk, dry van, LTL; effectively giving shippers a ‘one-stop-shop’ for their transportation needs.
Maintain carrier information. For shippers going it alone and working with different carriers directly, there can be a lot of work that goes into maintaining the carriers’ licensing, insurance and regulatory compliance information. Some 3PLs have a dedicated team whose responsibility it is to keep these records updated and ensure that the broker’s TMS system assigns shippers’ loads ONLY to carriers that are up-to-date and qualified to handle them.
Can a shipper use a freight broker AND hire carriers directly? Or is it one or the other?
Shippers can and do use both carriers and freight brokers. Often, a shipper will have a comfort level with a specific carrier in a specific lane(s). As capacity is needed for new lanes however, shippers can lean on brokers to source them and/or lean on brokers to simply explore options in these new lanes. Some shippers may also choose to augment existing carrier arrangements with broker-based loads within the same lane so that they are not too reliant on a single carrier.
There are other times where a shipper may have a new product that is outside of its regular carrier’s wheelhouse and, again, a brokerage can step in and handle transportation for that product.
What are some value adds that a freight brokerage provides to shippers?
A major value add that freight brokers provide is emergency shipping. When you’re dealing with a single carrier, it has what it has. If you have an emergency and all of that carrier’s trucks and drivers are booked, you’re out of luck. A 3PL with a large network, however, can pull trucks in from near and far to support your needs.
What are misconceptions that shippers may have about freight brokerages?
The barriers to entry to becoming a freight broker are relatively low. It’s important to partner with a broker that has a proven track record and the longevity that breeds trust. In Bulk Connection’s case, we’ve been a trusted partner to shippers all over North America since 1987.
What about digital freight marketplaces? Do they replace the broker?
For some freight where the broker adds little value, the broker role may not be necessary. But anyone who’s ever booked a shipment – especially a bulk or hazmat shipment – understands that there is often significant knowledge and back and forth communication that goes into making the shipment successful. As such, shippers need true experts to guide them through the process. You’re simply not going to find that expertise and support in a load board or a computer algorithm – especially if the project encounters a hiccup along the way.
How can freight brokers help shippers during the COVID-19 crisis?
By showing up ready to get the job done. Transportation is vital to keeping our economy running, so the folks at Bulk Connection are here and fully operational to support our shipping customers and carrier network. We have been following CDC guidelines regarding safety, hygiene and social distancing since the outbreak, and we’ve been doing everything we can to keep our employees safe and supply chains moving. We will be monitoring and following guidelines as things start to ease up as well.
Learn more about 3PLs and freight brokers
Whether you have been partnering with freight brokers for years or are simply interested in the advantages they could bring to your supply chain, contact Bulk Connection to see how its expert 3PL services can supercharge your operations. With over 30 years of liquid and dry bulk and dry van experience, Bulk Connection has the expertise and the carrier network to help you optimize your shipping operations. To learn more, contact us today.