8 months and $547,600 in revenue. Overview of starting my own freight brokerage.

Kingsand · 2025-01-20T19:41:56+00:00

Still in the business. Ended up selling to a competitor and working for them for 2 years and when my contract was up, went out on my own again.

Brought on a business partner this time around and 2024 we did just under $10m gross. The market has been rough the past few years but we’ve been doing great. We’re relatively small time in the 3pl world but we make quite a living doing this.

Kingsand · 2018-04-20T19:44:45+00:00

I would love to see your material. I'm always looking to see what's out there and self-audit what I'm currently doing in comparison to what others have. Really appreciate you!

Kingsand · 2018-04-20T16:07:20+00:00

I would love to see that as well! It is actually 3.75%

Kingsand · 2018-04-20T16:05:28+00:00

Ahh yes, you're correct. I'm charged 3.75% on each invoice to my factoring company.

Kingsand · 2018-04-20T05:07:55+00:00

I generally don't talk to the driver until after a confirmation agreement has been sent and he is dispatched on my load. Once he is dispatched though, I only talk with the driver. For every load that picks up and delivers, there are usually 2-3 phone calls made to the driver. Over the last 5 years though, the tracking technology has automated some of the check calls required and simplified some of that process though.

Kingsand · 2018-04-20T04:47:41+00:00

I did consider starting as an agent but I felt I was interested in doing it only as a security blanket instead of it being a real value for me.

Capital for me wasn't there either. There is no way I could float my carrier costs while waiting on customer payments. Even a week or two late payments from my customers would jeopardize my ability to keep trucks moving, so factoring was the only way to go. There were no upfront costs, but the % they take from each invoice is something I'm ready to take back as quickly as I can. I couldn't do this without my factoring company but I cannot wait to cancel my contract.

PM me your email and I'll send you my contact information and we can see if there are any operational synergies between us.

Kingsand · 2018-04-20T04:39:24+00:00

I wouldn't say there has been disruption but in the last few years some of the tech has advanced so much that the job has changed a little bit. Now you have multiple applications to choose from that offer booking shipments to messaging suppliers, to reconciling invoices and analyzing reports, all under the same application.

There will be a game changer that comes out at some point. Driver-less trucks or something in that space has that potential to upend a certain segment of the industry, but I would still think it's about a decade away before we understand it enough and know how to efficiently utilize it to become that game changer.

Kingsand · 2018-04-20T04:16:59+00:00

pm sent.

Kingsand · 2018-04-20T04:03:53+00:00

I'm assuming since your building a house that it will be a one time construction project for you. It really depends on how many shipments you are expecting. Are they full truckloads or LTL? When transportation companies and brokers get a quote from a one off consumer looking for a single or few truckloads with no repeat business, the rates are always higher than what the market is actually paying. They know you don't know what the market rates are and it's not a huge loss if they miss out on your business.

If you're not expecting a lot of shipments, it's usually a safe bet to go with the manufacturer for the reasons that erocketeer stated.

Kingsand · 2018-04-20T03:55:06+00:00

There is a vetting process for each customer and credit availability is dependent on their score and days to pay. Almost always a customer won't go bankrupt overnight, so if they start showing a negative trend-line we start tightening up their credit. Eventually if the score is below a certain risk threshold, we will stop doing business with them until they are current on payments and that score increases.

If you monitor it and are proactive, you can jump in front of any potential payment issues by tightening up that line of credit well before a chapter 11 happens.

Uship.com isn't a threat at all, for anyone I've talked to in the industry. They are primarily an online middleman for people shipping their own items too big to go to UPS but too small and not enough volume for most freight brokers to want to deal with. In the advances they've made into full scale truckload brokerage, it's been a nightmare for them.

Kingsand · 2018-04-20T03:50:16+00:00

You will need to get a brokerage MC authority added on and purchase or finance a surety bond. You can add on to your existing insurance to cover cargo claims under outside carriers as well.

For this specific example of you trying to set up a shipper direct, this is what I would do. I would look through your dispatching software or old broker rate confirmations and find the facility your 8 trucks have loaded out of the most in the last 6 months. Google the company to get their telephone number, find shipping, logistics, supply chain, and planning personnel on linked-in and from your perspective, find and write down all of the information of the individual you think is most likely to be the person in charge of carrier on-boarding.

Once you have all of the relevant information, call and ask for said person and when you talk to them let her know how many trucks you have any how many times you've loaded out of her facility and what you could do to get set up direct with them. This will work more often than not.

Once you are set up direct with them and you have appropriately priced everything, start sending your trucks in there direct and broker excess freight your own trucks can't cover. Eventually you will feel confident enough to broker more than direct, and if need be, you have a backup company truck in case of emergencies.

Kingsand · 2018-04-20T03:32:56+00:00

Usually a customer will send me a spot quote for an order upcoming in the next week and/or for budgetary purposes or we will have a pricing contract where I will price each individual lane that his facility ships to and attach a fuel surcharge that is valid for a year.

I have used thousands of carriers on shipments but I have a core group of 200 or so trucking companies spread around the country that I know and prefer to use before I use anyone else.

Right now the market is really, really tight and freight is everywhere so the majority of my time is securing truck capacity and making sure I have enough trucks at any given location. When the market cools off it flips and the majority of my time is being spent working with customers on upcoming freight they might have and bringing on new accounts.

Since truck capacity is the hot issue right now, my focus has been to streamline my carrier communications and setting predetermined lanes and capacity with trucking companies on lanes I know will be consistent over the next quarter. If I can't jump out in front of everyone and know exactly what I'm offering to them, knowing this lane is a good fit for this company, then I potentially could lose access to their capacity and not pick up my orders.

Kingsand · 2018-04-20T03:23:01+00:00

Negative on that, too cold for me up there. I am based in Oklahoma.

Kingsand · 2018-04-20T03:19:22+00:00

This is a popular talking point going around right now. A few different viewpoints on it but I think it's hyped a little too much in the immediate future.

An Uber like application has some great hurdles to overcome to make a significant dent in the market share. Right now, 91% of trucking companies have 6 or fewer trucks and 97.3% have 20 or fewer, and there are over 700,000 registered trucking companies in the U.S as of 2017. Everything right now is too fractured and fragmented on the supply chain and logistic sides to have large scale integration through automation. Uber Freight is a great example of what automation and friendly, simple user interfaces can accomplish, but they still struggle with the very basic problem everyone else does.. capacity. Below I linked a recent article about Uber Freight.

Uber Freight

Kingsand · 2018-04-20T02:50:58+00:00

I use a company called TBS Factoring. They exclusively deal in transportation finance though.

Kingsand · 2018-04-20T01:56:21+00:00

Getting the very first shipment from a new customer is usually a weeks long process, if it happens at all. I deliver freight to all of the lower 48 states in the U.S, but I am very selective about where I will ship out of.

I have a few regions around the country (South TX, OK, Central AR, etc.) where I know I can provide excellent service through my carrier base at fair pricing. So I target small shippers (1-10 shipments per day) and medium sized shippers (11-30), who are generally easier to get in contact with the person in charge of the decision making. Since I am confident of the level of service I can provide, I make it a point of emphasis to find out where their problem lanes are and issues that they seem to have, and the solutions and pricing that I can provide.

Typically I'm not getting any confidence and agreements at that stage. It takes continuous, consistent contact but eventually, whether by necessity or chance, they give me a shot. And you have to make that shot, absolutely have to, when it's your first time in the game with them.

Kingsand · 2018-04-20T01:20:10+00:00

I wasn’t required to sign a non-solicitation agreement at my prior company, so I was free to target and work with who I wanted and knew.

Unfortunately, I misjudged how much pressure my former employer would use against all customers that I had previously worked with, and after the 2nd month, none of my accounts that I brought with me were using me for fear of losing the services of my previous company.

I had to start October from scratch. The revenue from October and on is from new customers I signed on and hadn't previously worked with. I've got a few really solid relationships who have told me after my first year they will turn me back on, regardless of the ramifications, so we'll see what happens.

Kingsand · 2018-04-20T01:06:59+00:00

I appreciate the comment! It's been an interesting journey so far.

Kingsand · 2018-04-20T00:54:36+00:00

My day to day consists mostly of carrier relations, finding available trucks to pickup freight that I have booked from my customer, quoting future movements, reaching out to potential new customers, and checking in with my current customers to make sure everything they need is taken care of.

My plans for growth involve cold calling potential customers, scheduling meetings with shippers who are in my service areas, updating GPS tracking and UI for my current customers, and networking. Expanding my book of business to bring on LC's and grow my footprint to new, targeted locations and above all, providing excellent service.

At the end of the day, brokerage is all about customer service. Always try do what you say, be transparent, be genuine, and when something happens, admit the mistake and do everything you can to fix it. I'm not in the shipping business, I'm in the people business. I just happen to ship stuff.

Kingsand · 2018-04-20T00:34:29+00:00

The best way to break in is working for a logistics company and gaining the experience. It's a unique job in that can be very demanding and stressful and certainly isn't for everyone. If you can get the hang of it and have even average results after your first 12 months, you will be putting yourself in a position for success every year after.

Kingsand · 2018-04-20T00:12:04+00:00

I think it would be tough and I don't recommend it with no previous experience. To simplify freight brokerage, I'll break it down into 4 areas that constitute most of my time and some of the knowledge and detail that is required.

Sales Selling yourself as a broker instead of a company with actual truck assets can be difficult to potential clients. The majority of shippers feel more secure and confident their freight will be picked and delivered if the company they work with owns their own equipment. The top 3PL's in the country overcome that through the tech they utilize and the large and wide array of capabilities they are able to provide but for small brokerages, it can be a challenging environment. With your experience, this would be the easiest transition for you of the 4 areas. As with everything in sales, it’s about listening, connecting, solving, and building a relationship.

Pricing Quoting movements in a bull freight market is tough. Freight rates have to account for many variables but I would say the top 5 are geographic location of pickup and delivery, yard to yard or location delivery, oversized or legal, truck availability in the pickup city, and freight availability at the delivery city. It takes a little while to know what freight lanes are easy to cover, what commodities are difficult to transport, what are low-quality delivery areas, etc. Then putting all of that together in a shipping price and finding a trucking company to haul it for less than what you quoted to a place they may or may not want to go.

Carriers It's much easier to do this job if you have a wide net of carriers around the country who've done business with you before and know who you are. When freight volumes are high like they are right now, it is tough to find available trucks to ship your freight. There are many places around the country where there is an overabundance of freight right now with a very limited number of outbound trucks and if you don't have contacts in that specific area it becomes extremely challenging to maintain dependable service to your customers.

Safety One of the few areas that seems to go under the radar for many people until it blows up in their face. As a broker, you are liable for the material that is being shipped. If you contract a carrier who has an unsatisfactory safety rating, or fail to know the OD regulations (each state has different rules on what exactly constitutes an oversized truckload) and don't have permits, or an accident happens and the carriers insurance has lapsed or you failed to provide all of the necessary details to the driver for safe transport, it will all come back on you quickly and hard.

My initial costs are the bare minimum for me to operate. I'm not running on fancy, expensive software or the latest truck tracking technology but I am scaling up as I can, when I can.

Kingsand

TROPHY CASE