Freight broker
A freight broker is a licensed intermediary who arranges transportation between shippers and carriers without taking possession of the freight, earning the margin between what the shipper pays and the carrier receives.
Last reviewed · by the Fleetchart team
Brokers hold their own authority and are required to maintain a surety bond. They exist because shippers want one point of contact and carriers cannot economically maintain a sales force.
For a small carrier, broker relationships are a business asset. Rate matters, but so do payment speed, honesty about detention, and whether the broker's loads actually appear as described.
Ranking brokers by realized margin and days to pay — rather than by quoted rate — tends to reorder the list considerably.
For example, say a shipper pays a broker $2,500 to move a load, and the broker pays you $2,150. The broker's margin is $2,500 − $2,150 = $350, or $350 ÷ $2,500 = 14% of what the shipper paid.
You usually never see the shipper's side, so judge a broker by what reaches you: the rate, how fast they pay, and whether detention and lumpers get paid when they should. A broker who pays $50 less but pays in 15 days instead of 45 can be worth more to your cash flow.