Freight Broker Agent Requirements
Most people when first starting in the freight broker business start out as a freight broker agent, working under the umbrella of a brokerage firm that is bonded and has brokerage authority.
Besides training, what are additional costs or requirements needed to be a Freight Broker Agent?
- Since this is normally a work from home job, you need a home office set up, if you don’t already have one. For equipment you need a computer, a 4 in one printer/scan / fax / copier,2 screens, a desk and chair, file cabinet and office supplies.
- You need a phone with unlimited long-distance service, high speed internet, and you may choose to purchase or subscribe to software to benefit your job ($30-150 month optional / depending on how many you subscribe to).
- Some brokers (but not the majority) charge fees to the agent as part of their internal business model (for such things such as marketing/advertising, training, and usage on their systems and processes or software, use of phone system etc.)- but more do not so this would be optional.
Freight Broker Requirements
Besides training, what are additional costs or requirements needed to be a Freight Broker?
(Please Note: We don’t recommend that you do these steps before training.)
- If you are going to be the Broker, you will need to choose a name for your logistics company and set up the legal structure of your company (such as SCorp, LLC or other); your accountant or attorney can advise you with which would be the best choice for your own situation.
- You will need to file for your brokerage authority with the Federal Motor Carrier Safety Administration ($300 filing fee, OP-1 form). (Once you’ve obtained your registration you’ll need to file a biennial update form MCS-150 – no cost).
- You will need to obtain process agents (one time fee generally runs from $45 to $65 for this), and then you’ll submit this form to the FMCSA (Form BOC-3).
- You’ll need to register your business through the Unified Carrier Registration system (currently $76 fee for brokers).
- You’ll need to obtain a surety bond or trust fund in the amount of $75,000. (Ranges for the broker bond are generally from 750 to 9000 depending on your credit situation/ but is issued by an,insurance company that offers freight broker bonds. The trust fund is generally around $1500 per year if you go that direction but also requires collateral with a bank.)
- Check with your particular state for any requirements that your state may require to operate a business within your state.
- Set up your office and purchase a transportation management software system (TMS). These can vary greatly in price from a few hundred dollars monthly upward. You will also want to purchase load board software. (For questions on the FMCSA or prices please call Jan @ 817-999-5398.)