Advantages to Using a Broker

michellewebsterMiscellaneous

I have heard and seen a lot of comments stating “Don’t ever use a broker!” plastered all over some carrier’s(/broker’s) websites. I can see the appeal of wanting to bypass the broker fee by contacting the carrier directly. For many people, the bottom line is all that matters. I realize that economic times are tough and most of the people are interested in getting the best price possible. However, I would like to point out a few things to the customer looking to deal directly with the drivers as opposed to paying a freight broker. The first thing being–most carriers are also brokers.

Imagine this…trucking Company X gets a call from a customer looking to ship their freight from point A to point B. This customer wants to know if the company owns their own trucks. Yes, Company X owns their own trucks. That is good news to the customer who is looking to deal directly with the carrier, not a broker. The customer schedules transport. Well, Company X’s trucks are all in different areas and will not be near point A or B for at least a week or two. What  are they going to do? Are they going to tell the customer it may be a week or two before they can pick up? For some, this would not be an issue at all. However, the majority of the customers I work with are on some kind of time schedule and do not have weeks to wait for their product. So what if the customer does not want to wait? Do you think trucking Company X says “I’m sorry. I guess we cannot help you.” No! They will not say anything and instead broker out the load to a friendly company that they do business with. After all, they did not lie when they told the customer they owned their own trucks. They just failed to mention that those trucks would not be anywhere near the location of the customer’s freight.

Most of the truckers HG Logistics LLC, a third party logistics company in Cincinnati, Ohio, deals with are owner operators. The cost of maintaining and operating their own truck can be very expensive. Understandably, they are usually happy to let a broker pay for the cost of advertising and supply them the freight for free. A good percentage of truck drivers HG Logistics works with do not even have websites. Therefore, a broker provides a very valuable service to the carrier. In addition, your standard broker pays carriers in 30 days. HG Logistics is a broker that does even better, paying our carriers in 15 days.  If a carrier works directly with a customer, they are looking at a 45 to 60 day wait for pay, which is the average pay cycle for many businesses in this struggling economy. If a carrier chooses to work through a broker, they can expect quicker pay for their services, while the broker floats the money waiting out the longer pay cycle from the customers.

There are many other very good reasons to schedule your transport through a broker, but my goal here was to point out the obvious ones to those who feel brokers are an unnecessary additional expense and should be avoided.