DefinGuideVer1 Broker Business Model

The Definitive Guide to
GrowingYour
Freight Broker Business
Using Broker Agents
Version 1
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Copyright 2014 John D Thomas All Rights Reserved
Table of Contents
Disclaimer ....................................................................................................................................... 1
Foreword......................................................................................................................................... 2
Introduction .................................................................................................................................... 5
Growing Your Business ............................................................................................................... 5
So, Just What IS a Broker Agent? ................................................................................................ 7
Here Are Some Topics We Will be Covering ............................................................................... 8
Before You Begin

The Business Model ...................................................................................................................... 10
A Brokers Product or Service ................................................................................................... 10
A Brokers Target Market .......................................................................................................... 11
Marketing Strategies and Business Development .................................................................... 12
An Assessment of Resources and Potential Obstacles ............................................................. 14
Creation of Metrics to Measure Overall Performance ............................................................. 17
Profit Margins-Gross and Net ............................................................................................... 18
Return on Assets (ROA)......................................................................................................... 18
Return on Equity (ROE) ......................................................................................................... 19
The Concept of Agency

How an Agency is Created ............................................................................................................ 20
Setting Up and Managing Operations the Brokerage................................................................ 22
Setting Up and Managing Operations the Agency .................................................................... 23
What Services, Software or Tools Will Be Provided to Agents? ............................................... 23
Spreadsheets......................................................................................................................... 23
Load Boards........................................................................................................................... 24
Database ............................................................................................................................... 25
Proprietary Software............................................................................................................. 26
Training ................................................................................................................................. 26
The Broker-Agent Agreement ................................................................................................... 26
The Independent Contractor Statement of Understanding ..................................................... 27
What is the Commission Structure? ......................................................................................... 27
What Is the Payout Schedule and What Are Some of the Related Issues? .............................. 28
What are the Standard Operating Procedures for Acquiring New Customers and Carriers? .. 29
Suggested Guidelines for Monitoring and Evaluating Customer Performance ....................... 30
Profit margins........................................................................................................................ 31
Number of loads tendered ................................................................................................... 31
Are loads easy to cover? ....................................................................................................... 31
Timely collections ................................................................................................................. 31
Communications ................................................................................................................... 32
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Other? ................................................................................................................................... 32
Suggested Guidelines for Monitoring and Evaluating Carrier Performance ............................ 32
On-time pick ups and deliveries ........................................................................................... 32
Truck availability ................................................................................................................... 32
Communications ................................................................................................................... 32
Ability to follow instructions ................................................................................................. 33
Recruiting to Win
Knowing What You Want .............................................................................................................. 34
Experienced Agents with a Following or New Agents .............................................................. 35
Independent Contractor or Employee ...................................................................................... 36
Desired Skill Sets ........................................................................................................................... 38
Self-starter ............................................................................................................................ 38
Telephone Use ...................................................................................................................... 38
Computer Use ....................................................................................................................... 39
Computer Research .............................................................................................................. 39
Negotiating............................................................................................................................ 39
Service ................................................................................................................................... 39
Multi-tasking ......................................................................................................................... 39
Organizational ....................................................................................................................... 40
Cash Management ................................................................................................................ 40
Current Affairs....................................................................................................................... 40
Filing Claims .......................................................................................................................... 40
Logistics and Supply Chain Knowledge or Experience .......................................................... 40
Finding Agents .............................................................................................................................. 41
Your Website......................................................................................................................... 41
Craigs List .............................................................................................................................. 41
Load Boards........................................................................................................................... 42
Contact Freight Broker Trainers............................................................................................ 42
Your Own Email List .............................................................................................................. 42
Industry Magazine Classified Ads ......................................................................................... 42
The Application and Hiring Processes

The Traditional Application/Interview Process ............................................................................ 43
The Initial Contact ..................................................................................................................... 43
Common Questions from Potential Agents .............................................................................. 45
Sample Questions YOU May Want to Ask Potential Agents ..................................................... 47
The Application ......................................................................................................................... 47
A Review of the Broker-Agent Agreement ............................................................................... 48
Background Checks with References ........................................................................................ 48
A Summary or Detail of the Duties and Responsibilities .......................................................... 48
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The Hiring Decision ................................................................................................................... 48
Agent Orientation ..................................................................................................................... 49
The Results-Oriented Application Process ................................................................................... 50
Customer and Carrier Relations.................................................................................................... 51
Customer Relations....................................................................................................................... 51
Carrier Relations ........................................................................................................................... 51
Growing Your Business Even More

A Website, Opt-Ins, Autoresponders, Social Media etc. .............................................................. 53
A Website .................................................................................................................................. 53
Opt-Ins....................................................................................................................................... 54
Autoresponders ........................................................................................................................ 55
Social Media .............................................................................................................................. 57
Agent Incentives ........................................................................................................................... 58
Volume and Margin Incentives ................................................................................................. 58
Bonuses Based Upon Whatever............................................................................................. 59
Information Sessions................................................................................................................. 60
Load Sharing.............................................................................................................................. 60
An Extra Board .......................................................................................................................... 61
The 80/20 Principle ................................................................................................................... 62
Appendix
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Disclaimer
The content and information in this eBook include legal issues that have NOT been prepared or
reviewed under proper legal scrutiny. There is no guarantee that this information is accurate,
relevant or applicable to your particular needs.
Further, many business laws differ from one state to the next and the content and information in
this resource may not conform or be applicable to your particular state law.
The sample documents related to the broker-agent agreement and the independent contractor
letter of understanding in this eBook are not necessarily complete. The documents may lack
important topics, issues and content that may be required for your particular situation and for
compliance with your particular state law.
You should rely upon your own legal, financial and business consultants before applying or
relying upon any information in this resource.
This writer is not responsible for any loss that may occur in using or not using the content and
information in this resource.
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Foreword
So you want to do something that will help grow your brokerage faster rather than slower?
Perhaps you want to make more money. Or you simply want more help so you can mastermind
the entire business without getting bogged down in details. Then this resource is for you.
Many brokers have a vague idea about using agents; but when it comes right down to it, they,
quite frankly, dont know where to start and they dont know if they are able to do it right.
For sure, those seeking to add agents will find it more complicated and difficult than what was
initially imagined.
The materials in this eBook are presented with the goal in mind of helping freight brokers set up
an Agency to acquire broker agents (or freight agents, used interchangeably throughout this
eBook).
This resource includes many ideas. Some ideas are new and may be used for testing and further
implementation; some may be rather routine to the freight broker industry but may not be well
known to those new to freight brokering.
For example, in this eBook, the extra board is introduced. It is an innovative strategy that may
further encourage and motivate agents to find customers and trucks. Another example is in
understanding and applying the 80/20 Principle. Not all agents are equal. The 80/20 Principle
will help brokers slice and dice agent performance.
Using case studies to illustrate a success story may be effective when dealing with both shippers
and agents. Using opt-ins and autoresponders to start and carry on a dialogue with others on
the Internet are powerful tools. And using the Applicant Evaluation Sheet in the Appendix to
take the emotion out of making decisions may be very helpful.
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These are a couple of ideas that you will discover in this eBook that will help you view your
business in new ways.
There are several particular traits in this industry that are worth noting: one, it is difficult to learn
from other freight brokers and, two, there isnt a lot of literature available. Its a competitive and
tight-lipped industry and those who know dont want others to know.
This leaves new freight brokers pretty much on their own when it comes to learning and
implementing new programs and strategies for either their brokerage or for putting on agents.
Therefore, experimentation is required. Creativity is required. Find out what works for you
then work it to the hilt. Many brokers ask themselves and others, Well what are other brokers
doing? Whats the normal way of putting together a broker agency?
These are legitimate questions but it may be useless to spend a lot of time dwelling on these
questions. By learning and implementing the ideas in this eBook, you, as a freight broker, will be
able to take action without relying on others who really dont want to share their knowledge.
You will be well on your way toward establishing the underpinnings of setting up your very own
Agency.
The success of this eBook and the extraordinary benefits that will hopefully accrue to the reader
are based upon three foundations: one, this writers actual brokerage experience where using
agents was begun but not fully developed; two, over ten years of freight broker training which
provided the core information that brokers and agents use; and three, over two decades of
working with small business start-ups.
Innovation and creativity may go a long way if they are implemented in measured steps. Take a
few steps at a time and then evaluate your progress. Yes, it takes a little more time and effort to
experiment; but, as mentioned above, there is hardly anyone willing to take you under their
wing or willing to freely disclose what THEY have discovered.
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We will go into more detail on these new ideas further down.
The Appendix contains two Load Manager spreadsheets. These are downloadable for immediate
use. Choose one to modify and use for yourself. If you do not currently use some type of freight
broker software, these spreadsheets will provide a valuable substitute. Further, they even go
further than broker software because of their analytic capabilities.
The underlying purpose of this eBook is to encourage you, the broker, to take the time and make
the necessary effort to set up an Agent program that is effective and profitable. The step-by-step
information that is presented here along with the several new ideas are merely starting blocks.
The final part of this is for you to take the required action. Dont procrastinate. Dont lay this
information aside. A new world awaits you if are ready to take action!
Best wishes!
John D Thomas
Atex Freight Broker Training, Inc.
El Paso, Texas
June 30, 2014
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Introduction
Starting your own freight brokerage business is a great way to earn a living and can be very
profitable. The real profit, however, comes from explosive growth and expansion, as with any
other business. While you may be very comfortable working by yourself, there is only so much
you can do without help.
Growing Your Business

So, questions emerge: What is your vision for your business? How big do you want to grow? If
your vision and desire are to grow using agents, this choice embodies both opportunity and
constraints.
The opportunity is almost unlimited growth. The constraints are in the communications and
operations that require more attention than operating just a small one or two person office.
To hire, with growth in mind, means choosing the right people that will serve as a direct
extension of yourself, your work ethic, and the brokerage business that you may have put so
many hours into developing.
Enter freight agents: using an army of agents can take your brokerage to new heights as you
build your empire however large or small you envision.
For sure, when it comes to using agents in your freight broker business, you are facing an
entirely different situation with new demands and requirements as compared to running your
brokerage without agents. Whether you plan to add just one or two agents or twenty or fifty,
there are managerial and operational requirements that need to be addressed BEFORE you bring
anyone on board.
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Because of this added dimension in using agents, it might be wise to save this ace-in-the-
hole until you are ready. That is, wait until you have developed a complete Agent program that
meets your needs and one that will be easily communicated to potential freight agents.
Wait until you have established sound business fundamentals such as using good cash
management skills, crafting creative and effective strategies to help you achieve your goals,
setting up operations that you and others can rely upon with confidence and making the habit to
conduct periodic planning sessions with others. Many business owners fail to directly address
and deal with these fundamentals.
When you are ready to start adding agents, make sure you are familiar with questions that may
be asked of you; make sure you have answers to these questions; make sure you can paint a
picture, so to speak, of an attractive future for your agents.
Using agents is not the same as hiring employees. For employees, there are legal and operational
demands different from hiring agents. With an employee search, you normally spend more time
in the selection and hiring process. Yes, some employers are only seeking a warm body. So
there are exceptions.
Nevertheless, creating and building a successful Agency requires a lot of planning and
implementation. Otherwise, you are going to attract unproductive applicants that mirror the
second-rate program you may be offering.
Its true some brokers are just looking for a hired gun that might go out there and do a real
good bang up job. Then the agent moves on for other or better opportunities.
So, you as a broker, need to have in mind a happy medium where you do better than just
bringing on a hired gun and, yet, dont get overly wrapped up in an agent search only to find out
your agent plans to leave in six months or so.
Now, lets get on with more information on using freight agents.
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So, Just What IS a Broker Agent?
Simply put, an agent is generally an independent contractor that represents your brokerage
business in finding and working with customers and carriers. Your business provides the agent a
chance to work as a freight broker without the extra risks involved in owning his or her own
brokerage. But more importantly, it may allow you to expand your company into territories you
wouldn't otherwise be able to cover just on your own.
For example, if your company is based out of Kansas City, having agents in Southern California
would allow you to build your business from both areas. No, you dont necessarily need to be in
Southern California to work that area, but you may find agents that are familiar with the
particular region where they have been living and working.
For sure, you can even have agents in New Hampshire, Oregon, Florida, Pennsylvania and other
areas if you'd like! The possibilities are endless, and the room for growth is always there.
Agents usually work from their home which is why many freight brokerage businesses use them.
Rather than spending money on adding more office space and increasing overhead costs, using
an agent while they use their office can help keep general costs to a minimum and there is very
little upkeep involved.
One more point here, the relatively new legislation, MAP-21, increased the surety bond/trust
fund requirement from $10,000 to $75,000. This has made it more difficult for some to become a
freight broker and may have pushed some already licensed brokers out of business. Now they
may be seeking agent positions where they are not required to put up the bond or trust fund.
They work under the umbrella of another brokers authority.
So, this increase in the cost of becoming a freight broker has added another motivation for some
that are seeking agent positions. Should this make any difference in your recruiting efforts?
Perhaps. Maybe some of these displaced brokers have a nice following or a book of business.
You may want to lend them an ear. This could be a win-win for both of you.
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Here Are Some Topics We Will be Covering
Now that you know a little more about what agents are, let's talk about how your business can
use them to grow even explode your business. Before we do, however, let's quickly go over
some of the topics in this eBook.
We are going to cover many topics involved with adding freight agents to your brokerage
company. We will go into detail in most of these topics.
This is a partial list of the topics in this eBook:

Deciding upon a business model
How to market your business, using your business model
The concept of Agency what the law says and what you need to know
Managing your internal, brokerage operations creating a sales and collection policy as
well as your guidelines for paying trucks, etc
Managing your agent operations providing procedures and guidelines for your agents
Setting up software, spreadsheets and databases to manage your agents as well as
customers and carriers
Helping to prepare guidelines for agents to use when monitoring and evaluating customer
and carrier performance
Knowing what you want and who you are looking for when recruiting agents
Knowing what skill sets and past performance you will be requiring when seeking agents
Creating a commission structure for your agents
Where to go to find freight agents
When to use employees rather than agents
Two ways to recruit and hire agents
Defining broker and agent duties and responsibilities
When and how to cultivate better customer and carrier relationships
Plus more
Many brokers use a contract to establish a professional and legal relationship with their agents.
On the other hand, there may be a number of brokers that do not use contracts.
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This is a matter between you and your legal counsel. There may be pros and cons when using
contracts; nevertheless, it could very well be that using a contract is the best way to ensure a
good working relationship.
In the Appendix below, a portion of a sample Broker-Agent contract is available. You will be
introduced to some of the common topics used in these contracts. The sample agreement,
however, is not complete and, again, you may want to discuss this with your legal consultant.
Also, in the Appendix, you will find an Independent Contractor Letter of Understanding. You
will want your agent to sign off on this.
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Before You Begin
The Business Model

One of the most overlooked aspects in starting a business is in creating a business model. You
may have heard a lot about preparing a business plan but a business model? Business
models help focus time, energy and money and should keep everyone in sync as individual
workers go about their daily duties.
Business models can be detailed or general in nature. Usually, models are laid out in broad
strokes and detailed business plans are developed out of these broad strokes.
A business model starts with a product or service, a

target market, strategies on how to take that product
or service to market, an assessment of resources and
potential obstacles and, possibly, creating metrics
used to measure overall performance.
Many business owners have an idea and simply run with it without taking the time to step back
and developing a game plan. You dont have to write a major college thesis as you create a
business model or even a business plan. At the very least, sketch it out on paper. Lets look at an
example of creating a business model:
A Brokers Product or Service

Does the broker want to focus strictly on truck brokering at its simplest level or does the broker
want to create a third party logistics company (3PL) that wants to not only move cargo for
customers but wants to help plan detailed logistics services covering motor carriers, rail, air and
ocean freight?
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Or does the broker want to work as a freight forwarder as well and consolidate cargo or offer
warehousing services?
Or does the broker want to use their brokerage to supplement a current trucking operation? If a
broker wants to supplement their trucking operation, does he or she want to have company
drivers or does he or she want to have owner operators leased on to them?
Your skills, resources, desires, time and effort will help define what products or services you
want to offer.
A Brokers Target Market

Just whom do you want to target with your products and services? Your target market may
encompass manufacturers, distributors, produce growers, wholesalers, live stock owners, plant
and floral business owners, etc., large and small. You will need to define your market in terms of
demographics, including size, and other characteristics, etc.
Generally, starting out, a broker may get the urge to find a niche. After all, it would be easier to
define your market if you had a niche. However, if you are a new broker, it is better to take
whatever comes your way. At some point later on you may want to focus on a niche. Starting
out, however, begin creating a customer profile regardless of what type of cargo you are moving.
In defining your target market or creating a customer profile, it may not matter if your market is
small. You dont always need large markets.
The key is to find receptive markets. Ideally, you

want to seek customers that are ready, willing and
able to do business with you right now.
In seeking receptive markets, you will have already clearly defined your services and resources
and you have studied your target markets needs and have created efficient and effective ways to
reach and service them.
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Lets talk about your marketing strategies and business development.
Marketing Strategies and Business Development

Marketing is positioning your business in front of your potential target market, gaining their
attention and then taking action to engage them if they dont first take action to engage you. The
better you position your business in front of your market, the easier it is for each of you to
engage the other.
Marketing strategies can include all forms of advertising (look at all the full page ads placed by
transportation companies in truck-related magazines). You can also use email campaigns, video
productions, mailings, creating case studies for some of your success stories, after-hours social
events, brochures, letters, recognition for others accomplishments, etc., etc. Dont forget guerilla
marketing strategies to find creative and unique ways to gain attention.
Guerilla marketing lends itself to using your imagination and a lot of creativity. Guerilla
marketers use only low-budget strategies. Keep things simple and seek maximum impact in your
simplicity. Lets talk about case studies.
One of the most powerful and effective ways to

market your services is by using case studies
that are based upon REAL success stories.
You may have a particular customer or several that were impacted in a powerful way with your
services. You would create a story in which a problem that your customer was facing was
eventually overcome and solved due to your intervention.
The story does not have to be dramatic or extremely detailed. You merely point out a problem
that your customer faced and how you provided the solution.
A marketing strategy, when effective, leads to business
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development. That is, once you have gained a customer
or ready to close the deal, you apply yourself to making
sure that you keep that customer. It is so important to get
your agents on board in some way to ensure that everyone
is pulling in the same direction with the same message.
Keep this in mind as you seek to build your empire no matter how large or small.
As you consider your marketing alternatives, remember, it is not about YOU. Your potential
customer only cares Whats in it for ME?
In summary, your marketing strategies may begin with agents doing a lot of cold calling. For
those that want to meet face-to-face with potential customers, that is fine. But personal visits can
be time consuming and not very productive if the agent does not have experience or a penchant
for this approach.
Probably the Internet and telephone will make up the bulk of an agents time and effort. First, a
large list of potential customers needs to be compiled by each agent. Then, its on to the phones.
Many businesses operate and succeed with a robust group of agents on the phone without ever
meeting anyone face-to-face.
At some point both you and your agents may want to start categorizing customers into an ABC
List. The A Group is for those that are meeting your expectations and benchmarks and they
love you or your agent. Group B is for those that may need to be better educated on your
services; and you may need to explore their needs more so than others. You would like to move
them into your A Group. Lastly, Group C is for those that do not meet your benchmarks and you
may end up firing some of them or encouraging your agent to seek out better customers.
You may want to provide incentives to agents if

they attain certain profit margins, or if they are
finding more and more customers that fall into the
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A Group, for example.
An Assessment of Resources and Potential Obstacles

Resources can fall into several categories:
1. There is capital (liquid or real, accessible or not accessible). For example, cash is capital
and liquid, real estate is capital and not liquid; savings, investments or access to loans
may accessible; equity in a personal residence may not be accessible.
Three points to be made: one, know what capital you

have to work with; two, capital requirements for a
brokerage or to set up an agency are relatively low; and
three, too much capital may encourage undisciplined
spending.
2. There are human resources. These are the individuals that join with you whether they are
family, partners, employees or agents. Each individual is a potentially valuable asset that
can maintain and perpetuate your business. Careful screening and selection of whom you
choose to work with is essential. Selecting individuals that complement your strengths
and bolster your weaknesses may be better than individuals who are similar to you.
3. There are intellectual resources. These resources include the entire body of knowledge,
information, skills and experience that you and your team possess. Included in
intellectual resources is the good old-fashioned ability to make wise decisions.
4. Good will is value that is created over time. It is different, although connected, with a
tangible asset or a stream of income. It is created in how customers and others perceive
you, your people and your organization and how these customers act upon their
perceptions.
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Be aware that every effort that you and your people make to fulfill and exceed customer
expectations is another brick as you build your house of good will.
There may be other resources available but these four are very important.
Identifying potential obstacles can be difficult. No one has a crystal ball. Many, if not most,
business decisions are made with very little visibility and, perhaps, shrouded in a lot of
uncertainty, especially when making decisions that entail long term projections.
Nevertheless, potential obstacles have to be identified as accurately as possible and decisions

may have to be made without having a complete picture.
Lets look at several examples.
The first potential obstacle relates to your selection of agents. What you THINK you may be
getting in an agent may be far different than what you REALLY get. Knowing what you want in
seeking agents is crucial. And preparing a selection criterion will help. We will talk more about
this further down.
The second potential obstacle relates to carrier and customer selection. Dealing with a new
carrier for the first time may be like a roll of the dice. Carrier selection should be the joint
responsibility shared by the principal (you) and the freight agent. After working with a carrier
over time, performance can be monitored and evaluated. Your company will want to work with
those carriers that meet your benchmarks and remove those carriers that dont.
Likewise, selecting and working with new customers can be a challenge. A credit check will help
but it is not full-proof. Talking to the shipping manager is essential. Before you commit to taking
a load with a shipper, you need to have a very good idea of when to expect payment. The credit
approval process can be done by the broker; the collection process could be shared with the
agent.
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The key is for you and/or the agent to record and monitor performance and become as familiar as
possible with both customers and carriers.
The third potential obstacle relates to infrastructure and carrier assets. Our countrys roads and
bridges are antiquated along many highly traveled traffic lanes. Many hours are wasted due to
inefficient modes of travel. Delivery throughput is bottled up. Costs are driven up due to these
inefficiencies. The consumer absorbs most of this increase in cost; but some companies are
unable to push the full cost off to the consumer.
Carrier assets trucks and drivers - are undergoing greater regulation. Over-regulation can be
stifling. It drives costs up as well. Again, delivery throughput is thwarted as compliance becomes
more overwhelming.
The fourth potential obstacle relates to wrongful legislation. CSA2010 is still in limbo and
the FMCSA remains obstinate in the face of opposition from the Government Accounting Office
(GAO), the American Trucking Association (ATA), the Owner Operators Independent Drivers
Association (OOIDA), the Alliance for Safe, Efficient and Competitive Truck Transportation
(ASECTT), brokers, freight forwarders, shippers plus other objective university studies.
These opponents have pointed out the inaccuracies and misleading conclusions that result from
the flawed SMS methodologies. Opponents contend that FMCSA publication of these flawed
data should not be made public.
The fifth potential obstacle relates to weather. The first quarter of 2014 was witness to record
snow levels, droughts, floods, tornados you name it.
These five examples reveal some potential problems and there may be other big problems
lurking on the sideline.
Some of these potential obstacles are outside a persons control. Nevertheless, by working
proactively, brokers and agents may be able to lessen the impact of potential hazards of the
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business. Anticipate these potential problems, or train your agents, and be ready to go to Plan B
if Plan A fails you.
What you dont have Plan B? Working proactively requires that you have in place various
plans and responses to any number of potential problems.
Creation of Metrics to Measure Overall Performance

As you build your business model, how will you measure performance? How will you know if
you are progressing or not?
Of course you should be recording revenues, expenses, profits, asset acquisitions, and new
liabilities as you progress. And, many business owners focus especially on increasing revenues
and profits. Sometimes cost controls are not properly implemented as expenses increase both
fixed and variable expenses that increase as revenues increase.
However, as a broker, you know that a brokerage is normally not laden with assets. And debt
requirements are usually low. The real key to brokering success is in managing margins
margins that make up the difference between what the shipper is offering and what you end up
paying the truck. If you have agents that know how to negotiate, you have a good start in
building your business.
What metrics or benchmarks will help measure overall performance?
Three such benchmarks are:

1. Profit margins Gross and Net
2. Return on assets, and
3. Return on equity
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Profit Margins There are two types of profit margins. The gross profit margin is measured
by the profit after paying the truck divided by total revenues; the net profit margin is the profit
after paying the truck and all operating expenses divided by total revenues.
Total Revenues
Less payments to the truck, equal
Gross profit (divide this by Total Revenues for the margin %)
Less operating expenses, equal
Net profit (divide this by Total Revenues for the margin %)
Brokers are concerned about both the gross and net profit margins; agents are only concerned
about their gross profit margin, that is, what is the profit after paying the truck.
Margins may fluctuate from load to load, from shipper to shipper, from time to time and may
even be seasonal. Growing net profits margins usually indicate the company is increasing its
market share. That is, the company is growing the business faster than competition. Conversely,
eroding net profit margins indicate the company is losing market share. Evidence of eroding
profit margins may drive a brokerage company and its agents to seek out better paying
customers. Or, to negotiate lower rates to the truck.
Both options are fraught with peril and this one of the challenges that makes brokering so
interesting.
Return on Assets (ROA) Many freight broker companies are non-asset based brokers (as
noted above). That is, they are not running trucks. Comingling trucking with a brokerage is
actually a business model begun by some brokerages in the past; yet, new business owners
looking into starting a trucking company and a brokerage (or just a brokerage) need to review
current legislation (see MAP-21 legislation) on these issues.
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Nevertheless, as you generate more sales dollars and greater profits, the company may be
generating more assets such as growing the amount of cash in the bank or adding on new
equipment. The net profit measured against this increase in assets is one measure of
performance.
Return simply means the net profit and the return on assets tells business owners what net
profit they are getting for the assets they have in place. This measure would have more relevance
for asset-based carriers but it has some relevance for brokers as well.
Return on Equity (ROE) Equity refers to the investment made by owners or shareholders.
A cumulative increase in net profits over time usually results in a greater equity stake and this
increase in profits measured against the increase in equity is another measure of performance.
Again, the Return simply means the net profit and the return on equity tells business owners
what net profit they are getting for their investment in the business. This measure also has more
relevance for asset-based carriers because of the larger investment relative to that of non-asset
brokers but it also has some relevance for brokers as well.
In summary, when defining your business model, you will employ a holistic approach to include
services to be offered, identifying target markets, preparing marketing strategies, identifying
potential resources and problems and setting up metrics to measure your performance.
When you enter the freight broker business (or any

business for that matter), you want to make sure as
accurately as possible that you are in a game that
you can win.
If you win, congratulations! If you lose dont let that devastate you. Use your loss as a
stepping stone to something else.
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The Concept of Agency
When you hire agents, you are bringing in help with the goal of increasing your business and
market share. As such, the agent works as a representative of your company to help you achieve
your goals.
How an Agency is Created

An Agency is created with a legal, written agreement, or verbally, between a principle (freight
broker) and their agent (freight agent). The principle gives authority to their agent, allowing
the agent to represent and bind the principle in business negotiations and transactions.
This authority identifies what the agent can and cannot

do and is usually given in a written contract or with
other supplemental papers. With a written or verbal
agreement, the broker defines the nature, scope and
duties of each agent.
There are laws governing relationships

Between the principle and the agent,
Between the agent and other third parties, and
Between the principle and other third parties
If an agent works outside the scope of the agreement, the agent may be subject to removal from
the brokers company or may even face legal charges. Not only is a meeting of the minds
necessary the broker and agent should perform in accordance with the agreement.
Both the principle and other third parties rely upon the good faith of the agent who identifies
himself/herself as an agent representing his/her principle. Misrepresentation can not only make
an agent liable but may also mess up business transactions between the principle and other third
parties to the extent of irreparable harm.
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The principle also has to comply with the terms outlined
in the agreement.
These terms usually include paying the agent as agreed to in the agreement and holding the agent
harmless in the event of claims, liabilities and expenses while the agent is discharging his/her
duty as an agent in accordance with the agreement.
Lastly, there may be differences in state laws regarding the laws of Agency and it would be wise
to consult with an attorney to ensure that you understand matters and that you are in compliance.
For example, the laws of Agency apply to corporations, LLCs and partnerships. Yet, there may
be differences among these three entities from one state to another.
Regarding a freight brokerage that is set up as a general partnership with a few or many partners,
each partner acts as an agent and can bind the entire partnership with third-party agreements,
etc., depending on the agents authority. Likewise, if a freight agent, acting within his/her
authority, makes a bad or foolish decision, the principle is bound by this action.
Review some sample or actual Broker-Agent Agreements; highlight those areas that appeal to
you and then seek out an attorney if you want the best possible Broker-Agent Agreement.
Having one agent or several, agents can be a great addition to your business and bring incredible
value as well.
However, it is crucial to understand that bringing

agents into the business is a different animal
and requires preparation beyond just running a
brokerage.
Further below, we will address practical issues related to the who, how, what and when:
knowing what you want,
agents versus employees,
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recruiting agents,
setting up the commission structure,
setting up daily operations for you and your agents,
preparing and assigning duties and responsibilities between you and your agents,
establishing a time frame to complete the various stages involved in bringing agents on
board
plus more
Setting Up and Managing Operations the

Brokerage
Whether your freight brokerage is relatively new or established, there should already have been
put into place plans and strategies for conducting business. Operations may or may not have been
put into writing but there should be decisions already made regarding such issues as:
Maintaining the broker authority, including the BOC-3 and the UCR,
Assignment of duties and responsibilities,
Customer acquisition strategies,
Customer evaluation,
A collection policy for receivables,
The pros and cons of using a Factor,
A policy for paying trucks,
Getting set-up with motor carriers,
Prequalifying carriers and carrier selection,
Invoicing customers and paying motor carriers,
Spreadsheets or software to record, monitor and evaluate performance,
The necessity for insurance in addition to the trust fund or surety bond,
And so on ..
If you ARE new and HAVE NOT completed these

items above, STOP HERE! Do not proceed and get
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22
signed up for detailed and comprehensive freight
broker training.
Go here: www.atexfreightbrokertraining.com
Having operations established, attention needs to be focused on building an army of agents. You
should also have in place before you hire your first agent a step-by-step plan to bring
agents on board. What does your total program consist of? Exactly how are you going to build a
powerful, effective and profitable sales force?
Setting Up and Managing Operations the

Agency
By setting up a detailed program of how the you and your agent will interact together, including
expectations that are clarified, uncertainty will be minimized and business can move forward
more smoothly compared to those that try to wing-it.
What Services, Software or Tools Will Be Provided to Agents?

Spreadsheets?
Load Boards?
Database?
Proprietary Software?
Training?
Spreadsheets
Spreadsheets may provide analytic functions that expensive freight broker software may
not provide. In the Appendix, you have two spreadsheets. These are more for the brokers
use rather than the agents.
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For the first spreadsheet you can record load activity for several agents (Load Manager
Worksheet for All Agents). The worksheets (tabs) on the bottom will represent each
agent.
With the second spreadsheet (Load Manager Worksheet for John Doe) you will record
the load activity for just one agent and the worksheets (tabs) at the bottom will represent
each shipper.
Regardless of which spreadsheet you use, you

can see how many loads each agent is getting,
what his or her per cent and dollar split is, how long
it takes you to pay the agent and even the number of
miles on each load and the rate to the truck.
There is a lot of information in a very compact area on these spreadsheets. And, with
some creativity, you can modify these spreadsheets to include other information that is
important to you.
By recording and monitoring load activity, patterns evolve over time making it easier for
the broker to make decisions on whom to work with and whom to drop, if desired.
These spreadsheets are under copyright protection but you are free to use them in your
brokerage.
Load Boards
Some load boards are free, some run about $35-$45 per month and others about $150 per
month. Study the services provided by each one.
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The freebie load boards may or may not be active; the middle-range load boards can be
very good; and the higher-priced load boards may include bell and whistles that are not
essential, especially if you are new to brokering.
You may want to provide access to one or several load boards for your agents. Or, you
may want to leave that purchase to the agent.
Some load boards may offer programs for brokers with agents. In other words, the load
board may provide discounts for agents for a certain minimum number of agents.
There are probably over 100 load boards and you may want to focus attention on those
that provide activity, options and service.
Database
A database to collect customer, carrier and agent information is essential. Your databases
become your goldmine. As you build your databases of information and monitor the cash
flow that you are building, your databases may become valuable assets that can be sold or
passed on to family, partners or friends.
And, trust me, if you have a list of customers

that are generating consistent and recurring
income month after month, you might be
surprised at how valuable this becomes.
If you are using freight broker software, it has database features to record all load activity
as well as building a wealth of customer, carrier and agent information.
If you dont have freight broker software (and this may not be the best investment if you
are starting new), you may use any good contact management software.
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Proprietary Software
This type of software is custom software written for a particular brokerage. Usually only
the largest brokerages will go to this expense. There may be a number of very good
software packages that can be purchased right off the shelf. And, yet, some of these can
be a bit pricey in themselves.
Automating your business with software that has integrated features, i.e. export
capabilities to QuickBooks, generating confirmations, etc. can be useful after you build
your business. But starting new, the best software in the world wont help you find
customers and this is what you want to concentrate on if you are new.
You may want to search for Broker-Agent software that will allow you to build and
manage your database of agents. It may also provide reporting capabilities and help when
making payments to agents, including printing and mailing 1099 forms at years end.
Training
Some brokers conduct agent training. Some brokers require training in their facility and
they charge for it. Maybe as much as $2,500.
Is this an option for you? Perhaps a rebate on the training fee could be given after the
agent completes satisfactory performance for a period of time. Perhaps the training could
be outsourced and a rebate policy could still be in place.
You are the boss. You choose whatever fits into your business model.
The Broker-Agent Agreement

The Broker-Agent Agreement is best left to an attorney. The agreement need not be cumbersome
but YOU need to make some decisions first on how you want to operate your business using
agents.
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The scope of duties and responsibilities are especially important for you to consider as you
approach the preparation of your agreement.
Review some sample Broker-Agent Agreements and highlight those topics that make sense to
you. If you are surfing the Internet for samples, the agreements for real estate brokers, stock
brokers, mortgage brokers, etc., may or may not be helpful.
Or you may consider modifying and using the sample Broker-Agent Agreement in the Appendix.
It is in rough form but you may change it to your liking.
Some Brokers keep a public copy of their Broker-Agent Agreement on their website. You have
to decide if you want to do this if you have a website.
The Independent Contractor Statement of Understanding

If your decision is to hire only independent contractors, you may want to provide a statement
for the agent to sign in which they indicate an understanding of the Broker-Agent relationship
and agree that they are indeed independent and that they are responsible for their own taxes and
expenses. These agents are called 1099 contractors and your legal relationship with them
should be clearly laid out in your Agreement.
Hiring employees entails a completely different responsibility and we will touch on this further
below.
What is the Commission Structure?

It may be difficult to determine what the normal commission structure is between the Broker
and his/her agent.
But you may find commissions that run

70/30 with 70% going to the agent, or
60/40 with 60% going to the agent, or
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50/50, or
40/60 with 40% going to the agent
The agent should be looking at the total package and not just the split. It is YOU, the broker,
however, that needs to make a decision on this. You may have agents seeking a better split than
what you are offering and the question is, Are you open to negotiation?
On the other hand, you may want to initially ask the agent what type of split they are seeking.
Newer agents may not know what to ask for; more experienced agents may want to dictate to
you want they want. If you are open to negotiation, then negotiate.
What Is the Payout Schedule and What Are Some of the Related Issues?
Will you be making payouts weekly, bi-weekly or ?? Weekly payouts are common. Some agents
may not be too concerned about how quickly they will get paid. Everyone is different and with
time and experience in talking with agents, you can fine-tune your offer.
Usually, the broker does not invoice the customer until the broker receives the carriers invoice,
bill of lading and other paperwork related to the load. However, there may exceptions to this. For
example, the broker may tender an invoice to the shipper, even by fax, before receiving the
truckers paperwork.
So, it is up to you, the broker, to determine your payout schedule and the timing. Most brokers
pay their agents as quickly as possible to keep the agent motivated.
Other decisions relate to non-payment or slow payment from the customer. Will you make a
deduction against your agent if the customer does not pay? Will you assess a late fee if the
customer does not pay within a certain time frame?
Its not uncommon for the broker to absorb the cost

of a non-payment unless the agent in some manner
commits fraudulent activity. Likewise, many brokers
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assume liability for their own errors in making
undercharges, etc. On the other hand, many brokers
will assess a fee against their agent if the customer
is a slow payer.
Sometimes the agent is required to assist in the collection process if payment is not received
within a stipulated time period.
Lastly, will you, the broker, have a minimum commission on each load? Twenty five to fifty
dollars minimum is not unusual. Or maybe 3% of the gross amount.
These are just a few questions and issues that need to be decided upon before completing a
Broker-Agent Agreement.
What are the Standard Operating Procedures for Acquiring New

Customers and Carriers?
When it comes to customer and carrier acquisition, the broker needs to prepare some standard
operating procedures for the agent. If an agent contacts a shipper or carrier that is new to the
agent, the agent will relate information to the broker to see if the shipper or carrier is already in
the database and approved.
If the shipper or carrier is already approved, the only transactions that are needed are for the
agent to take the order from the shipper and get the shippers confirmation sent to the agent, or
broker, and the agent will then send the load confirmation to the carrier for signature.
If the shipper or carrier is NOT already approved, the broker normally runs a credit check on the
shipper and does the proper due diligence on the carrier.
The agent does NOT want to dispatch a truck on a

load until both the shipper and carrier have gotten
approval from the broker.
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The turnaround time for getting a shipper or carrier approved should be fast. Both the broker and
the agent may stand to lose a load if the approval process is not expedited.
These procedures need to be laid out and communicated in advance of the agent taking orders or
dispatching trucks.
Your agents will need to know your policy on paying trucks. If drivers or dispatchers ask, Do
you make fuel advances?, your agent needs to know this. If drivers or dispatchers ask, How
quickly do you pay?, your agent needs to know this.
If a driver moving a load calls in to the agent and says, The receiver rejected the load.. or if the
driver calls in and says, I had an accident before delivery. How are you or your agent going to
respond?
The broker needs to communicate to the agent

at what point the broker will intervene on a problem.
A broker does not want the agent calling all the time
on small issues that should be dealt with by the agent.
There may be many issues that only the agent should be responsible for. For example, when
drivers or dispatchers ask for a backhaul, the agent should respond to this.
Suggested Guidelines for Monitoring and Evaluating Customer

Performance
If you hire experienced agents, they may already have in place techniques that are used to
monitor and evaluate customers.
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Otherwise, several benchmarks may be suggested to help focus agent time and effort. The best
way to perform analytics is to create spreadsheets for the information you want to record and
monitor.
Be sure to check out the links in Appendix B. Load Manager Spreadsheet Templates for two
spreadsheets that the broker may use. These may be modified for agents to use as well.
Here are several benchmarks that may be beneficial to the agent for evaluating customer
performance:
Profit margins Margins can be calculated for each load, an average for each time
period and an average for each customer. Review this topic in Creation of Metrics to
Measure Overall Performance above.
Number of loads tendered Is your getting one or two loads per month from
particular customers or ten or twenty or more? Generally, the more the better and when
you record this activity, you can quickly identify those customers with a few or many
loads.
Are loads easy to cover? It is one thing to get a lot of good paying loads but the
question remains: Can your agent find trucks for these loads when and where he or she
needs them? If some shippers are consistently giving loads that are hard to cover, your
agent may want to work with other shippers that have more loads that are covered easier.
Timely collections You and your agent may be getting decent margins but are you
getting paid as quickly as you like? This collection activity needs to be tracked and
financial software like QuickBooks will allow you to generate detailed aging reports for
both receivables and payables.
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If you have a slow paying customer, you may want to get your agent involved. However,
this should be addressed in the Broker-Agent Agreement.
Communications Many shippers and brokers use people with excellent

communication skills. Everyone should strive for clarity to eliminate potential
uncertainties. This is especially important when working in a fast-paced setting.
Other? Are there other benchmarks that you would like to use or you would like your
agents to use? Monitoring shippers, carriers and agents should be on-going? If you can
quantify an activity, put it in a spreadsheet.
Suggested Guidelines for Monitoring and Evaluating Carrier

Performance
On-time pick ups and deliveries This is pretty straight forward. You and your
agents need good, reliable drivers that will perform within reasonable time constraints.
Sometimes there are good reasons for delays. Your agent should find out whats going on
when a delay occurs. They may want to give the benefit of doubt to a driver but repeated
problems may need to be investigated.
Truck availability Your agent may have some carriers and, through no fault of their
own, they may not have trucks available when and where your agent needs them. Over
time and with proper monitoring, agents can refocus attention to those that are available
more often than not.
Communications Agents should encourage drivers to call and ask questions or get
clarification. Over time, both your agent and the carrier will learn to work together like a
well-oiled machine for the benefit of everyone. An agent should seldom ignore a driver
that asks a lot of questions.
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Ability to follow instructions It is one thing to ask a lot of questions; it is another
thing for your agents driver to follow instructions. Again, this is pretty straight forward.
If you and your agents take the time and make the effort to create important benchmarks and
record load activity, over time you will see patterns evolve that will help you and your agents
make better decisions. Making well-educated decisions based upon actual experience is better
than just trying to wing-it.
Lets summarize we have looked at your business model, we have discussed the concept of
Agency, we have dealt with setting up operations for your brokerage and your agents.
Now, we will address the recruiting process recruiting agents that will help propel your
business to new heights.
Recruiting to Win
You have to ask yourself, Why would an agent want to work with me? You may think you
have the greatest operation in the country or that you are the greatest person in the world; but, as
you start seeking agents, THEY are going to be thinking, Whats in it for ME.
Sure they will tell you how they can help you, they will try to relate their work history and
experience with your needs. They will talk about helping to build YOUR business.
But deep inside, they want to know how THEY can profit.
So, as your prepare your package and your offer, try to address these concerns that agents may
have deep feelings about. Some agents just want to get out there and hustle for business. They
are good at what they do. And they are happy with that. This is good.
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Other agents may be looking for growth opportunities and may be seeking greater responsibility
and recognition.
Are you prepared to deal with these differences?
What if your agent asks, Is there a career path

that might lead to becoming an employee or
partner or officer?
What will your answer be?
So, before you begin recruiting, make sure you know and understand what YOU want. And,
knowing what you want, how are you going to proceed?
Knowing What You Want

If working with agents is new to you, you may want to know what other brokers are doing as
mentioned further above. You may want to know what is normally done when setting up an
Agency. This is okay to some extent. But in this resource that you are studying, you will want to
confront some of the hard questions straight on and decide what YOU want to do.
With very little information available to freight brokers on using agents, you need to start with
Knowing what you want. As you work your agent business you may want to tweak things over
time. What you want to avoid is making major changes too often to the point of confusing you
and/or your agents unless, of course, these major changes are required for a good reason.
Lets look at two issues that you may want to tackle upfront:
1. Using experienced agents versus new agents, and
2. Using independent contractors versus employees.
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Experienced Agents with a Following or New Agents
Agents come in many sizes and shapes. No formal education is required and some agents with
little formal education may prove to be among your best performing agents.
As far as actual experience, you may run across situations where the agent worked as a freight
broker and, for whatever reason, does not or cannot continue as a broker. Or, the agent may have
been with another brokerage with some good experience.
Or, you may have a person with great trucking experience and is quite knowledgeable about the
industry; yet, they lack a following or actual brokerage experience.
Then you may have individuals with no experience at all. And some may be seeking to be trained
by a freight broker. Some agents are even willing to work for nothing, or very little, if the broker
will take them under their wing.
Brokers seldom do this. The broker does not want to expend time, effort and perhaps money on
training or working with an agent only to see the agent leave for greener pastures. And, a
contract to retain the agent for a certain duration of time may not be easily enforceable.
Most brokers will require experienced agents with a following or a book of business and, in
some cases, the broker may want the agent to have achieved a million dollars-a-year in
performance.
Be aware that brokers may encounter agents or

individuals that have no experience or do not
have a following. Yet, the agent or person may
possess motivation beyond the average agent
or may have connections or may possess
other traits or skills that might be valuable to
the broker.
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What kind of productivity can you expect from your agents? In many cases, the productive
agents may only be 10-20% of your agent workforce.
Does that mean you go out and recruit 25, 50 or 100 or more so you can end up with 3 or 4 up to
10 or 20 productive agents? Maybe so, maybe not.
By knowing what you want and refining your agent selection process you may be able to save a
lot of time, effort and money. As you work your agent business, you want to have in place a
good but simple selection process and methods for evaluating your agents.
Many brokers will increase the split to the agent as the agent continues to achieve greater
margins. Other incentives can be applied as well. We will deal more with incentives further
below.
An agent with an existing book of business might be the quickest way to get the Agency going.
Having a book of business means that the agent has already connected and worked with income-
producing companies and people.
Lastly, it would be wise, however, for the broker to do some due diligence to find out how active
a list of clients really is. Is the list filled with REAL clients or are many of them inactive?
Independent Contractor or Employee

If you are new to setting up an Agency, you may want to set your agents up as Independent
Contractors rather than as employees.
The Internal Revenue Service (IRS) has specific guidelines as to who is or is not an independent
contractor or employee.
As an independent contractor, the agent is essentially

self-employed. Most work out of their homes anyway.
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As self-employed contractors, they are responsible for
their own taxes and expenses.
The broker may want to assume the responsibility for some expenses. These would be identified
in the agreement and/or supplemental papers.
If the broker has agents working in-house, using the brokers facilities including telephone,
computer, supplies, etc., the IRS might consider the agent to be an employee and the broker,
then, becomes responsible for the agents payroll taxes and probably more. A form W-4, in this
case, is provided to the employee.
When negotiating with prospective agents with the intent of using them as bona fide independent
contractors, it is imperative that the agent understand that they are responsible for their own taxes
and the broker would require the agent to sign a statement to that effect. See Independent
Contractor Letter of Understanding in Appendix E.
At the end of the year, if the agents commissions exceed a certain dollar amount, currently
$600, the broker is required to issue a form 1099 by March 31 of the following year.
Now if the broker encounters an agent that has the potential to fill a staff position that the broker
has open or is considering, the broker may then convert the agent to an employee status. This
move has to be considered in detail because once a person becomes an employee there are new
obligations that the broker needs to fulfill.
The new health care law is forcing employers to

examine their obligations and expenses
especially as they relate to health and medical care.
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Desired Skill Sets
As you seek agents, you may want to prepare a list of skills that are important to you. Of course,
few agents will excel in every skill set desired or required for brokering; nevertheless, here is a
list of some skills you may want to see in your agents.
Self-starter
Telephone use
Computer use
Negotiating
Service
Multi-tasking
Organizational
Cash management
Current affairs
Filing claims
Logistics and Supply Chain Knowledge and Experience
Most of these are straight forward, but lets take a brief look at each one:
Self-starter Brokers are looking for agents that can take the bull by the horns
without over-relying on direction from the broker. Brokers can help agents focus on
action steps, preferably written down, that will provide the impetus for doing
something anything other than sitting around and procrastinating.
Telephone Use Some individuals think they know how to use the phone but the first
two items of importance where they may fail are not speaking directly into the
mouthpiece and not speaking clearly. The agent will be on the phone all day on most
days.
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Computer Use More and more individuals are becoming computer savvy. Make sure
your agents are used to working the computer. MSWord and MSExcel are becoming
basic programs where agents need to be proficient. There may be database software, or
freight broker or dispatch software that you may require proficiency in. Find out what the
agent knows. Ask for examples of what kind of work he/she does on the computer. Does
the agent have a hard drive back-up plan and service?
Computer Research Many individuals can work the computer but they may lack
research skills. Agents may need to explore the options and services that load boards
offer. They may need to explore how using census data or the NAICS code system can
help in locating shippers and carriers. These are just a couple of examples. If the broker
does not provide some type of contact management software, the agent should research
their options here.
Negotiating Most brokers and agents love to negotiate. A few others may hate it and
that may prevent them from succeeding or even working this industry. Negotiations
should hopefully result in a Win-Win-Win for everyone. There need not be any losers.
Service Having the heart of a servant will go a long way. This is one area where the
agent can stand out or fail miserably and lose customers. Many agents and brokers
seem to forget this as the months or years go on.
Multi-tasking Doing several things at one time very well and doing them in proper
sequence are traits of a good agent or broker. While doing agent interviews, try to elicit
examples of days where the agent was so busy they didnt have time to go to the
bathroom or whatever.
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Organizational Prioritizing becomes important. Knowing what to do first and
second and being flexible when things get in the way is the mark of a good agent or
broker.
Cash Management The agent does not normally initiate the invoice and collection
process; but they should stand ready to assist if their customer is running late on payment.
Current Affairs Does your agent know whats going on in the industry? Its good to
know who some of the major carriers are and what type of cargo they haul; and what
about knowing whats going on with CSA2010 or with the new CARB requirements
coming out of California or with the drivers hours of service (HOS) requirements? Does
your agent know his/her responsibilities and potential liabilities in these areas and is
he/she aware of the potential challenges?
Filing Claims Many, if not most, brokers do not file claims for their customers. But,
some do. Does your agent know the claims process? Is this a new service you could
provide? If you are new to brokering, you may not want to add this responsibility unless
you are well-versed in filing claims. Its really a shippers responsibility.
Logistics and Supply Chain Knowledge or Experience What about LTL,

intermodal, customs clearing, etc? Any value-added service that you and/or your agent
can provide to your customers will help attract new business and help hold on to current
customers.
If an agent can only master a couple of these, he or

she most likely will not survive. For those that can
master most of these skills, if not all, they will have
a clear path to success.
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Finding Agents
If there WERE a good place to find freight agents, most likely, no one would tell you. Can you
imagine being in the hot desert at a drinking well with fresh, cold water and you dont know how
much water is left in the well?
And these strangers come by asking if there is good, fresh cold water there in the well. I dont
know about you but if it were me, Id say something like, No, this water stinks! I think there is
another well down the road a ways.
Okay, maybe this is a little stretch here but you get the idea. You are not going to freely give
information to other competitors. They are going to have to rely on their own efforts. You are
going to have to do the same.
Having said this, here are a couple of places you might want to start as you seek good freight
agents.
Your Website Not all brokers have websites but if so, place a webpage, a message or
a banner ad on the website. Some brokers have web pages to attract broker agents,
including a summary of what they are seeking, a summary of their bio, an application, a
sample Broker-Agent Agreement plus more.
Craigs List This service is getting more popular for those seeking jobs or
opportunities as well as those needing employees, agents or opportunity seekers. Craigs
List has rules that people need to know about. For example, you cannot place the same ad
repetitively all around the country. As far as this writer knows, you can place an ad in one
locality and then delete it and then post it in another area. Or, you may reword your ads
and place them in several cities at the same time.
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You can hide your business contact info and have the person reply through Craigs List, if
you like. Or, you can provide a telephone number to call or text.
Load Boards Some load boards include a Classified Ad section. You may find many
other brokers that are seeking agents and two things stand out as you peruse the listings:
1. Most brokers, if not all, are seeking experienced agents, and
2. All of the brokers purport to provide the best of everything.
Well, why not?
Contact Freight Broker Trainers Dont neglect contacting Freight Broker

Trainers that may have a ready-made group of highly motivated people with good
experience and good training under their belt. The only drawback is the fact that most of
these graduates may not possess the experience that you might be seeking.
Your Own Email List If you have a website, you may want to consider preparing an
eBook with practical and useful information. Give it away free in exchange for a name
and email address. Then get set up with one of the contact management email providers
and communicate from time to time with your contact list.
The messages that you send every few days or so are called autoresponders and we will
deal with these below in A Website, Opt-Ins, Autoresponders, Social Media, etc.
Industry Magazine Classified Ads You dont necessarily have to spend a lot of
money seeking agents; but, at some point, you may want to consider this approach. There
are probably a lot of truck-related magazines and newsletters with a classified ad section.
As you reach out in your search for freight agents, make sure that you know what you
want, know what you can offer and be ready to easily communicate this and have in place
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your sales funnel that directs your agent inquiries all the way to your final desired
destination.
Getting prospective agents to complete the application might be considered a destination.

The ultimate destination is to get qualified agents on board.
The Application and Hiring Processes

Getting good agents can be a very time-consuming effort. You dont need this if you are like
most business owners.
You have several choices in your agent search.

1. You could go through the traditional application/interview process that may or may not
be effective. It may be effective if your prospective agent has several years of experience
and a book of business. Or
2. Your search may be ineffective because some people are very good at telling you exactly
what you want to hear even without having a book of business. Or
3. You could employ the Results-Oriented Application Process see below.
The Traditional Application/Interview

Process
The Initial Contact
Once you make contact with a potential agent (or they may contact you first) and answer
questions they may have, you may want to continue the discussion to keep things going. Let the
prospective agent know that you would like them to take the next step if you feel it may be
worthwhile. Or, they may express an interest to take it to the next level before you do.
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You have to play it by ear. Your screening process may be quite simple or you may want to
make it more of a challenge. For example
Some brokers advertise, Lets talk today and start tomorrow. This quick and easy strategy may
appear to be efficient - but is it?
If the selection process is quick and easy, you may get only those that have a Well Ill give it a
try mentality and this may NOT be what you are seeking.
Some experts say that if the person seeking an

opportunity perceives the selection process as
being a challenge and not a sure fire thing that
you may attract people that will more likely be
more dedicated once they make the decision
to go with you. Its called cognitive dissonance
and this writer will leave it to you to explore this
strategy.
To learn more, Google cognitive dissonance and see if any of the results apply to your
situation.
This writer experienced one particular interview in which the interviewer sat in front of a
window in a hotel while a second person was sitting off to the side and slightly behind this
writer. This second person was apparently making observations, maybe trying to read some
body language who knows? However, during the interview, there was a small aura of
mystery if not intrigue.
The interviewer asked all the questions but provided no information about the positions they
were seeking to fill. He was in control.
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He made sure to point out that the resume contained some red flags and, after some silence and
a couple more questions, he said he would give me, this writer, a shot. The interviewer then
mentioned about the requirement to attend one of their meetings.
To make a long story short, this writer made a round trip of 300 miles to observe employees
receiving their weekly commission checks (some were big). But, the entire process was
misleading, frustrating, and this writer returned home to never again consider any position that
was not properly presented.
However, for those that DID make a decision to join the group, they probably were very
impressed and dedicated - at least starting out. For this writer, it was like walking into a dark
room.
As a freight broker seeking agents, you dont necessarily have to present your opportunity with
such mystery; but you may want to consider developing some steps in the selection process that
are perceived to be a somewhat difficult no matter how badly you want to get some agents on
board. The Marine Corps is looking for a few good men. Why cant brokers do the same?
Common Questions from Potential Agents

Be prepared to answer these common questions that may come up during the initial contact. Or
you may want to put these in Q&A format on an ad or other handout that you might be using.
Here they are:

What is your split?
Do you have a contract? If so, for what duration?
Do you do FT, LTL or Intermodal? If so, roughly what percentage for each?
Do you provide free access to any load boards? If so, which ones? If not, what is the
agent cost?
Do you have any performance quotas? If so, what are they? If so, what time frames?
Do you require the agent to pay for anything like business cards or letterheads, etc.?
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What is your average days-to-pay the truck?
Who runs credit checks on shippers you (the broker) or the agent?
Are there any chargebacks against agents? If so, under what circumstances?
Do you have any freight broker or dispatch software? If so, is there a cost to the agent?
Do you have a trucking database for the agent and, if so, what is the commission to the
agent if the agent uses your database?
Do you have protected territories for agents or is it open?
Do you have a website? If so, is it interactive with shippers or carriers?
Under what circumstances do you want the agent to contact you if there is a problem on a
delivery?
Do you have contingent cargo insurance?
Do you have a list of duties and responsibilities for agents?
If I get set up with new shippers and trucks, who do these belong to?
Do you have a non-compete clause if I should ever leave?
If I bring a good book of business with me, what protection do I have if I turn these over
to you?
Do you have performance reviews where I could get a higher split? If so, can you explain
how it works?
Do you provide any incentives or bonuses? If so, what are they?
Can I use subagents to work with me?
Are you registered with the BBB?
Do you have any type of load share or truck share programs between the agents? If
so, how do they work?
Do you file claims for shippers? If so, for all of them or just some?
Over the past year, about how many agents have you added and how many have left?
You may need to give these questions some good thought BEFORE you begin your agent search.
Now, there may be questions that YOU may want to ask.
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Sample Questions YOU May Want to Ask Potential Agents
Are you currently working as an agent or freight broker? If so, for how long? If so, why
are you seeking a change? If not, what have you been doing?
May I contact your current broker (or employer)?
How much experience or knowledge do you have about the transportation and logistics
industries?
Do you have any particular area of interest to work in?
Do you understand some of the demands of working as an agent doing a lot of cold
calling, fast-paced environment, etc.?
Do you have a customer base? If so, what kinds of cargo are you moving?
Do you have a trucking base? If so, what kind of trucks are you using?
Do you have plans to open a brokerage yourself some day? (Or, you may want to simply
state that you are seeking agents for the long-term).
You can add to this list as you see fit.
So, what IS the next step if you or your caller wants to continue? Here is a potential strategy to
bring the agent on board.
The Application
You may have an application already on hand. Use it and modify it if need be. Otherwise, pick
up a generic application from an office supply store or surf the Internet for a sample.
You may ask for a prepared resume if you like. Some agents may not have one ready. If not, just
ask them to complete your application or questionnaire.
There may be personal questions that you do NOT want to ask from a legal standpoint. You may
want to check with a human resources (HR) person, your attorney or your state law on this.
However, you normally will not give the scrutiny that you would give to a potential employee.
Its up to you on how you want to conduct the gathering of information.
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A Review of the Broker-Agent Agreement
Most potential candidates will want to review the agreement. A few will go along with it after a
cursory review. Dont be offended if some want their attorney to review it. Other potential agents
may want make minor revisions. Again, its up to you and it would depend, of course, on how
important or how strongly you feel about making the revision.
Background Checks with References

You may already have a process for doing background checks. It is not a bad idea, and, in fact, it
may be very revealing when contacting 3-4 previous employers or brokers. However, many
previous employers are reluctant to give much information on an employee.
Usually you can at least ask a previous employer or broker, Would you rehire this individual
again? A Yes would be ideal. A No may still be acceptable. It all depends on the
circumstances and speaking straight forward with your potential agent.
A Summary or Detail of the Duties and Responsibilities

You may want to prepare a simple summary of the agents duties and responsibilities and give
this out for those who express an interest. You could later send a more detailed description if
they want to join your company. Or you can give out all the details up front. Its up to you. What
you are doing here is not only giving guidelines and laying out procedures, you are setting down
expectations what YOU will expect from the agent and what THEY can expect from you.
There is more on this topic in the Appendix further down D. 3 and 4 and E. 4 and 5.
The Hiring Decision

The hiring decision may or may not be the hardest part in your quest for good agents. Your
overhead costs are certainly less than using employees especially when using agents that work
out of their home office. Keep this in mind.
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So, when you decide to use an agent, call them immediately to make your offer. If they accept,
congratulate them and tell them how happy you are. Tell them the first step is for them to sign
and return the Agreement, the Letter of Understanding and the W-9 form that you will email or
fax to them.
Once you both sign and date the Agreement, you now have a legal relationship between you and
your agent.
If a potential agent does not immediately accept your offer, they may want to sleep on it. Tell
them you understand and ask them when they might have answer. Go from there.
As your Agency grows, you may want to consider using a good agent to assist or take over the
application function and/or the orientation function below. Communication skills, building
immediate rapport with people, and desire are all factors to consider when using this option.
Agent Orientation
Will you have some type of orientation? Most of it would be over the telephone but you may
want to have compiled other useful information to be emailed or sent regular mail. If you, the
broker, have a larger staff than just yourself, you may assign one individual to be the go-to
person to give some help or support in the beginning.
Perhaps you have software for each agent and there may be some orientation required here.
Maybe its getting set up with load boards. Maybe its going over in-house reports that you will
be providing to each agent. Whatever it might be, its good to try to start building some rapport
with your agent over and above the hiring process.
Once you have provided some orientation, its a

good idea to ask the agent, Okay, whats your
plan of action to get started?
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The Results-Oriented Application Process
As mentioned above, interviewing agents can be very time consuming. There may be another
way here it is.
Whether you have one applicant or fifty, tell each applicant you want to give them a small
project.
Tell them it is a trial project.
Tell them there is no immediate deadline.
Tell them to find two, three or five (or however many you want in the trial) new
customers and at least one or two new carriers.
Tell them you will pay them a certain split and add any other information that may be
necessary, i.e. the Independent Contractor Statement of Understanding in the Appendix
below.
With this strategy, you will sift out those agents that yield results and those that dont this is
what you are seeking - results.
This strategy is used with independent contractors in many areas of commerce landscaping,
auto repair, carpentry, etc. You are simple asking them to complete a small project and you will
pay them as agreed to.
Those that meet or exceed your expectations or perform according to your requirements can be
brought on board for more work with a formal contract or whatever you choose to work with.
Doesnt this seem more efficient than spending a lot of time in the interview process which may
not lead you to those that generate results?
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Customer and Carrier Relations
Customer Relations
There is no need to dwell upon the importance of customer service and good communications. It
should already be upper-most in the minds of every Broker. Plus, there are many resources and
materials on these two topics.
Nevertheless, customer service and good communications are the essential fundamentals of
successful freight brokering. Everyone has to be on the same page the Broker, the Agent, the
Shipper and the Carrier - and the customer has to feel, and be, secure in knowing this.
Contacting and introducing yourself to those shippers who are giving your agent loads may make
a good and lasting impression. Always be alert to learning what it is that your customer really
wants.
Keeping in contact with your agent concerning their customers is a proactive way to work your
business. Unhappy customers usually dont call you and tell you they are unhappy they just
quit giving loads to your agents. How sad. It may be prevented.
Carrier Relations
Carrier relations are every bit as important as customer relations. As a broker, including your
agent, you both are in the middle. You both walk a very fine line in trying to please both shippers
and carriers.
With all the new transportation regulations and the uncertainties that they bring, you have to be
very knowledgeable as to what is going on.
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The new legal requirements for truck and motor performance, the new hours of service (HOS)
rules and the new CARB regulations coming out of California affect not only truckers and motor
carriers, they affect brokers and agents as well.
There are the monster problems with the Compliance, Safety and Accountability (CSA2010)
regulations. The Federal Motor Carrier and Safety Administration (FMCSA) is the defendant in a
lawsuit, the outcome of which will hopefully clarify, among other things, whose responsibility it
is in the carrier selection process.
Smart freight brokers and their agents will make special efforts to keep pace with what is going
on in these cases. The broker may want to closely monitor each carrier and do so along with the
input from their agents.
Growing Your Business Even More

Using agents to help grow your brokerage is a great decision. And it may be the most effective
way to meet your goals quicker rather than later.
Yet, to gain more leverage, you may want to consider implementing even more techniques and
strategies than what has been considered up to this point. You may already be well-versed and
experienced in the ideas below; however, if not, you might be surprised at the impact you can
make as you are building your brand.
Building your brand lets talk about this a little bit.
Building your brand simply means that you consciously work at implanting a certain idea, image
or feeling into the minds and thoughts of your potential market. For sure, what YOU may think
you are may not be even close to what OTHERS think you are.
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Invoking emotional feelings, especially, can be powerful. This requires knowing your market
and knowing your skills and limitations. You might start by just asking a simple question: How
do customers benefit by working with me?
Just recently, this writer completed a survey from a large, stable investment company. The first
question related to how satisfied this writer was working with their company. The answer was,
Extremely satisfied. The second question related to how likely would this writer recommend the
company to others. The answer was, Very likely.
The survey then asked for the primary reason behind the answers. This writer responded,
Because I was able to talk, in person, with a knowledgeable individual.
Being able to talk to a live person is very important to this writer and many others and this
experience is solidly embedded in this writers mind. This writer has branded this company.
Do you want YOUR company to get branded?
Lets see what else can you do to build your brand? Lets talk about whats going on in the
Internet world.
A Website, Opt-Ins, Autoresponders, Social

Media etc.
A Website
While websites can be used effectively to build your brand and may actually drive paying
customers to you, a website for your freight brokerage is not a high priority if you are new to
brokering. If you are established, this is a different story. You may provide tools and password-
protected areas for customers to track loads, etc.
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The truth is, however, shippers normally dont surf the Internet to find brokers or agents. In fact,
many shippers are being called upon by many brokers largely due to the fact that many brokers
and agents use the same old shipper directories and end up calling on the same people.
You dont have a competitive edge with this strategy. You have to go where no one else is going
to find receptive customers. This takes some extra effort and a dose of creativity.
One gem that you never want to forget IF you choose

to build a website, never, NEVER let a visitor come to
your website without giving them the opportunity to
leave their name and email address. NEVER! More on
this subject in Opt-Ins and Autoresponders below.
Opt-Ins
Opt-ins are used to collect names and email addresses on your website usually in exchange for
something of value that can be downloaded immediately.
Some website owners want to collect more information than just a name and email address.
However, the more information that you require in order to download the information, the fewer
individuals you will have opting-in.
If you are going to the trouble and expense of creating a website, why not do it RIGHT? You are
missing the boat if you end up creating the same old boring website that thousands, if not
millions, of business owners have.
You dont care how pretty it is necessarily. You want it to be EFFECTIVE! Many not-so-pretty
websites are effective because they provide useful content and include an Opt-In option to offer
something of value.
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The freebie, or whatever you choose, has to be something that is practical and useful for your
visitor. It could be an eBook or a report. It could have a title that includes something like, How
to . Or 7 Tips for .. The item of value may identify a problem that your visitor is
currently experiencing and you are providing a solution or valuable input.
Remember, when a visitor comes to your website, they are focused on Whats in it for me?
They dont necessarily care about you or how great your service is. They only care about
themselves at this point.
In the report or eBook you might want to tell readers WHAT to do in a certain situation but hold
back on telling them HOW to do it. In your case, your eBook or report could be directed toward
potential freight agents.
Ask yourself, What are they looking for? What problems do they have? What pain are they
feeling? .. and so on. Then, give them some relief.
Okay, once you have some practical and useful information ready, you will want to subscribe to
some type of contact management service to set up and manage your autoresponders.
MSOutlook may not be what you need; on the other hand, you may be able to mesh Outlook
with your autoresponder service.
Autoresponders
Look at the word again, autoresponders. What are these? What is this? Auto probably means
something automatic. Responder probably means some type of response. You got it!
Autoresonders!
Autoresponders are a series of messages that go out automatically after a person has entered
their name and email address. They want your freebie and this moves them to sign up or Opt-
In.
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So what are the series of messages that go out automatically? You would first create a series of
messages in MSWord or whatever. You may create as many, or as few, messages as you would
like maybe 10-20, maybe 25-30 or maybe even more. But even if you start with 5-7 messages,
you will have a good start.
Then, with your contact management software, you enter these messages and assign them to go
out automatically every few days. Maybe send the first one out on day one or day two, then
follow up and send the rest out at whatever interval you desire. If you have 25, 30 or more
messages, you may want the latter ones going out every week or so. There is no hard-fast rule,
however.
The aim is to make contact every so often and more so right after the visitor signs up.
Now, what about the content of these messages? This may be the most difficult part. You want
to provide practical, useful information and refrain from bombing your reader with one sales
pitch after another. Maybe 25% of your emails could be hard sells.
In these hard sells, you give your reader a direct order, or what internet marketers say, a Call to
Action something like, Call Now or Go Here for More Information. You may hire
someone to write your messages or you may give them a shot yourself if you have the knack to
write persuasively. Again, readers are looking for information that is practical and useful or
something that helps them solve their problem. Anything less than what meets their expectations
will cause them to opt-out.
By getting people to opt-in and directing them to follow your calls-to-action, you will have
captured them into your sales funnel with the ultimate goal of getting an agent to say, Yes, I
want to become your agent.
Now listen .. dont get overwhelmed here.
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If you are not ready for all this (a website, opt-ins, autoresponders, etc.) keep these tools in your
arsenal. Start simple and build from there same thing for social media below.
Social Media
The best known social media platforms are Facebook, Twitter, Linked In, You Tube, Pinterest
and Instagram. This will not be a survey or discussion on the inner-workings of these sites. But
there is one thread that penetrates each of these and that is with each of these platforms, you can
build your brand without presenting your business in the form of an advertisement.
Social media are powerful for several reasons: first,

you hopefully wont turn your audience off with boring
material; second, you may be able to eliminate costly,
ineffective ads; third, you can engage your audience
in ways to help establish your credibility and expertise;
and, lastly, the money you spend on social media may
generate greater impact IF the campaigns are properly
conducted.
Lets briefly look at Facebook: many users on this platform are predominantly users that
communicate socially with peers and family. However, Facebook provides users the option to set
up company pages to feature and promote their business.
In addition, business users can create campaigns to target potential users or customers. Many
social users attempt to acquire as many Likes as possible. However, business owners are
interested in more than Likes - they are interested in sales. Successful business campaign
managers never lose sight of this fact.
The Internet is jam-packed with information on using

social media; for an alternative, business owners can
hire individuals or companies to prepare social media
marketing strategies.
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Kassie Green, owner of 11th Hour Marketing in El Paso, Texas states,
With social media - for it to be beneficial - you either need to spend
money to manage it or time to do it yourself. [Many] companies charge
outrageous prices and it is very hard to find someone to manage with
good content at low cost. Its costly to manage your FB if you need 4-5+
posts daily whether its in time or money.
So, for optimum results, you either pay an expert to conduct a campaign or you do it yourself IF
you know what you are doing. Many smart business owners will turn it over to a social media
expert.
Agent Incentives
Programs for agent incentives can serve two purposes:
1. Incentives that will reward good results, and
2. Incentives that will help retain good results agents
If you lose a good results agent, what chance is there of capturing another one that is producing
for you in the same manner? It may be very difficult to find a good replacement and very costly
if you do NOT provide incentives at least for those that are performing well.
Its that simple.
Volume and Margin Incentives

These incentives are meant to encourage agents to achieve more dollar volume performance
and/or higher margins.
For example, when an agent reaches $5,000 in collected commissions after the split for three
consecutive months, the broker will increase commission rate to Agent by 3-5%.
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Or when an agent achieves a 15% gross margin before the split for three consecutive months, the
broker will increase commission payout to agent by 3-5%
These are mere examples and it is wide open as to how the broker wants to structure incentives if
at all. Start simple if you are just beginning.
Any incentive is better than no incentive if you think it through.
Bonuses Based Upon Whatever

This is a wild card type bonus that can be given spontaneously or with the occurrence of an
event.
For example, a Christmas bonus, a New Year bonus, a bonus on the agents birthday or the
brokers new baby bonus. Creativity and surprise goes a long way to building some anticipation
and possibly better performance. If this wild card is used, it should be consistent and should
apply to everyone.
For example, you dont necessarily need to have 3-4 spontaneous bonuses per month; but 3-4
spontaneous bonuses per year are not out of line. You are not necessarily basing the bonus on
agent performance.
Bonuses dont necessarily have to be cash or

expensive acts. One of the best motivators can be
recognition given either spontaneously or at the
right time.
Recognition while conducting a fun-type contest can be very effective. You might want to top
off a contest with some type of cash prize or restaurant gift coupon for the winner or first, second
and third place winners or whatever.
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Information Sessions
Information sessions with a group can be a great way to learn what is going on with your Agents.
Using Skype, you can set up a phone call to as many as 25 individuals. They can be located
anywhere in the world. All you need is the phone number where they will pick up and you would
then set up a group call.
There are other vehicles for making group phone calls; but keep it simple if you are just starting
up.
It is a good idea to have some structure to a meeting

(this holds true for ANY meeting not just Skype
meetings). Provide the leadership that your agents
may be in need of. Dont go much longer than one hour.
You may feel that you cant find enough content for a full hour; but by providing an outline and
getting the ball rolling you may find the hour is gone in no time at all. Give opportunity for
Agents to discuss issues that are important to them. Dont let any one or two dominate the time.
Elicit comments or questions from the more reserved agents.
Everyone should benefit with group info sessions.
Load Sharing
Load sharing allows for more efficient cargo deliveries and/or keeping truckers rolling. For
example, your agent might have a load but cant find a truck. The agent would share that load
information to other agents who might have a truck to move the cargo.
Conversely, your agent might have a truck but it needs a load. The agent would find another
agent that has a load but no truck.
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In each case, the agent is willing to give a portion of their commission in order to get a load
delivered. Shippers and truckers may benefit from this efficiency; but some brokers do not allow
for load sharing for various reasons.
An Extra Board
Using an extra board is unique to freight brokering but it can work as a motivator while
providing more efficiency in the movement of cargo. Here is how it works.
You, as a broker, would ask agents to sign up for the Extra Board if they have an interest. They
would agree to take a lesser commission if YOU provide either a load or a truck from YOUR
database.
You would then make a list of these agents on a first-come, first-served basis. You would then
provide either a load or a truck from your database and give it to the first agent on the list. If that
agent quickly finds a truck or a load then that agent goes to the end of the list and another agent
moves to the top of the extra board.
If the agent does not find a truck or get a load after a time certain, you would place this agent at
the bottom of the Extra Board and pull up the next agent from the list.
The question is: why not just give the load or truck information to ALL of the agents and the first
one that gets a load or truck gets the commission at a lower rate? This is a common practice with
some brokerages.
The potential problem here is that some, or even many, of your agents may sit back and wait for
YOU to provide a load or a truck that needs a load. You may want them to be more proactive
and search for new customers or trucks instead of waiting for your handout
If you are just starting your new Agency, you may want to keep things simple at first. Later, you
can experiment with various strategies.
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The 80/20 Principle
Many business owners struggle simply because they dont understand this Principle. When you
hire agents, you are looking for results. The 80/20 Principle, if understood and applied
correctly, will give you the results you seek and perhaps a whole lot more.
This Principle was first observed and developed by an Italian economist, Vilfredo Pareto. While
he was observing patterns of wealth and income in different countries, he found that there was a
predictable imbalance in this distribution of wealth and income.
For example, in Italy, he found that 80% of the land was owned by 20% of the population. Other
students of this Principle found this distribution was applicable to many other situations.
While this Principle has applications for other disciplines and professions, you may want to view
it from the perspective of applying it in your brokerage with or without agents.
For example, the Principle says that 80% of your revenues from customers will come from 20%
of your customers. If you have agents, 80% of your agent revenues will come from 20% of your
agents.
Therefore, 80% of your customers or agents may be a drag on your business. And if the 20% of
customers or agents generate 100% of your revenues, your 80% may be actually costing you to
carry them.
Doesnt this thought intrigue you and stimulate you to
learn more about identifying those few agents that will
give you the greatest results?
Focus on what or who matters the 20% - is the lesson here according to many individuals who
are proponents of the 80/20 principle. You may be wasting your efforts by spending too much
time with the trivial 80%. If this Principle is understood and applied throughout your work
day, your work days may become more like mini vacations.
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However, there are some who differ on this principle. These individuals ask, Why not spend
80% of your time helping the trivial 80% become better performers instead of spending time
helping the productive 20% become more productive?
Your challenge as a broker is two-fold: first, recording agent activity so you know who the 20%
and 80% are; and, two, make a decision on which group you want to work with if at all.
For sure, there are no clear answers as to whether you should spend most of your time improving
the low-performers versus the high-performers. It seems that business owners are forever making
decisions in the midst of a lot of uncertainty.
One proactive solution is to set up spreadsheets or get

a good Broker-Agent software package that will enable
you to record all your agent activity including a roster
of your agents and their respective revenues.
And make note of how much time or cost each agent is requiring from you.
Go to the Appendix B Load Manager Spreadsheet Templates to find two spreadsheets that will
help record and monitor agent activity.
One spreadsheet will allow you to record each load for all your agents and allow you to create
worksheets (tabs) for monitoring each agents activity.
The other spreadsheet will allow you to record each load for just one agent and allow you to
create worksheets (tabs) for monitoring each shipper.
Study these spreadsheets. Modify them as you like. Then, make better decisions based upon load
and agent activity.
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Appendix
Table of Contents
A. Applicant Evaluation Worksheet

Instructions for Using the Applicant Evaluation Worksheet
B. Load Manager Spreadsheet Templates
C. If You Use Broker-Agent Software
D. Information Sent to Prospective Agents

1. Application to Become a Broker Agent
2. Summary Broker-Agent Program
3. Summary Freight Agent Daily Operations Guide
4. Summary Freight Broker Duties, Responsibilities and Obligations
IF A PROSPECTIVE AGENT DOES NOT RESPOND OR IS

NOT INTERESTED STOP HERE
E. Information Sent to Agents If They Return Application

1. Form W-9
2. Independent Contractor Letter of Understanding (Guide)
3. Broker-Agent Agreement (Outline)
4. Detail - Freight Agent Daily Operations Guide
5. Detail - Freight Broker Duties, Responsibilities and Obligations
F. Supplemental Information for Agents

1. Shipper Telephone Call Log
2. Shipper Order Form
3. Carrier Profile
4. Other
________________________________________________________________________
64
A. Applicant Evaluation Worksheet
1-10
Applicant #1 Importance Rating Score
Shipper following 20 10 200
Carrier following 20 5 100
Agent or Broker experience 20 10 200
Other industry experience 10 5 50
Telephone skills 10 6 60
References 10 8 80
Motivation 10 9 90
Other? ____ ____
100 780
1-10
Applicant #2 Importance Rating Score
Shipper following 20 0 0
Carrier following 20 5 100
Agent or Broker experience 20 0 0
Other industry experience 10 8 80
Telephone skills 10 9 90
References 10 5 50
Motivation 10 5 50
Other? ____ ____
100 370
Instructions for the Applicant Evaluation Sheet

First and foremost, this evaluation sheet is to be used as a guide, not the end decision. This guide
will take some of the emotion out of the process of making your best selection. It will allow you
to focus on issues that are important to you by using a number scale of 1-10 to evaluate traits for
each caller.
________________________________________________________________________
65
On the left column, you will list all the skills and traits that are important to you as you select an
agent. Add, subtract or modify this list as you like.
In the second, column, you will assign a number between 1-100 to each trait. The higher the
rating, the more important it is to you. You will be prioritizing the traits, giving them a weight
equal to how important they are to you. The total cannot exceed 100.
Then, in the third column, you will evaluate each applicant, assigning a number between 1-10,
depending on how you view each applicant for each trait. For example, if having a following is
important to you, you would assign a number 10 if they have a good following; conversely, if
they have no following, you would rate them as a zero.
In the last column, you will multiply the number in the Important column times the number in
the 1-10 Rating column. You then add up the scores for all the traits to come up with a final
score.
In the example, you have Applicant #1 with a total score of 780 and Applicant #2 with a total
score of 370. Does this mean that Applicant #2 should not be hired? Not necessarily so.
However, you might use the scores as a basis in the profit split you assign to each applicant.
Maybe you would give Applicant #1 a 60% split and maybe Applicant #2 a 50% split. It would
be interesting to compare how you evaluated each agent and what their actual performance turns
out to be.
However, if you find this evaluation technique to be too complicated, you may want to hold off
on using this tool.
________________________________________________________________________
66
B. Load Manager Spreadsheet Templates
These spreadsheets might be the most valuable part of this eBook. If you are not use broker-
agent software, these spreadsheets will allow you to record every load, calculate important stats
and monitor all your load activity for your agents or shippers.
The first spreadsheet can be used for all agents and includes a master worksheet (tab) with all
load activity and other worksheets (tabs) below for each agent.
Here is the link to download this template and a screen shot:
Load Mgr SS for All Agents.xls
________________________________________________________________________
67
The second spreadsheet can be used for just one agent and includes a master worksheet (tab)
with all load activity and other worksheets (tabs) below for each shipper.
Here is the link to download this template and a screen shot:
Load Mgr SS for One Freight Agent.xls
If, after using this spreadsheet, you have comments or any ideas for improvements, you are
welcome to email us at the address below:
Email us here: info at atexfreightbrokertraining.com
Put LM Spreadsheet in the subject line.
________________________________________________________________________
68
C. If You Use Broker-Agent Software
If you are starting a new brokerage or starting a new broker agency, you may want to start by
using one of the Load Manager spreadsheets referred to above.
However, if you have an established brokerage and are already set up with broker software, you
may have already experienced the efficiencies associated with using software.
Here is a plan of action to consider if you are indeed new to brokering and setting up an agency:
Use the spreadsheet of your choice above. You can record all load activity and monitor each
agent and each shipper as well as your overall progress. You will be monitoring profits margins,
days to pay agents, number of loads, rates to the truck, average dollar profit per load.
Carefully study the spreadsheets. They are pretty straightforward but you may want to modify or
add other important information. Just try to keep it all in a compact area so you dont get lost or
confused.
In order for you to enter data into the spreadsheets, you may have the agent to complete some
basic information, using the Shipper Order Form included here in the Appendix at F.2. The agent
would complete basic information to include the MC# and send this information to you so you
can approve or disapprove the shipper. If you approve the shipper, you have some of the
information that needs to be entered into the Load Manager spreadsheets.
In addition to the Shipper Order Form, the agent would also complete basic information for each
motor carrier that you will use to prequalify your carrier. See the Carrier Profile in the Appendix
at F.3. If the carrier is not in your database of approved carriers, you would then do your due
diligence on that carrier.
Now, if you are looking for more sophisticated load manager tools, you may be interested in
fully developed software. Some software costs are monthly; some have an initial cost and
monthly or quarterly support or maintenance fees.
Here are some important software features that you may want to focus on when searching for a
good software vendor:
________________________________________________________________________
69
First, the ability for your agents to create a load,
assign the customer, shipper, consignee, extra-stops,
enter carrier information, send a rate confirmation
and dispatch the driver all from one screen. Your
freight broker software will be building a database of
shippers and carriers as well as details on all load
activity.
Many software vendors are more than happy to provide demos on their software. Just search the
Internet for freight broker software or something similar.
Keep in mind that some freight broker software is written without using agents in mind. It may
be very good software for strictly freight brokering and with many good features; but there may
be no applications for setting up and using agents.
Some software vendors report that their software is written for dispatching, for truck companies
or for shippers. Again, these may have good features but they may not be for using agents.
If you use freight broker software, with or without broker agent features, you normally will have
an integrated system which will manage three major functions:
Customer and carrier acquisition and management..

such as company names, contact information, profiles (what kind of trucks needed
(shippers) or what kind of trucks provided (carriers), insurance monitoring (carriers),
days-to-pay information (shippers), entering notes, etc.
Load activity functions..
such as points of origin and destination, amount due from shipper, amount payable to
carrier, generating confirmations, calculating profit margins, etc.
Accounting functions..
such as recording and reporting revenues, cost of sales (payments to the truck), operating
expenses like load boards, office supplies, computer and Internet, etc.
________________________________________________________________________
70
If you are a new brokerage, keep this in mind: the best software in the world will not help you
find customers. It will help you manage your customers after getting established but your
initial, primary focus should be in securing customers with loads.
If you do NOT use comprehensive freight broker software, your minimum requirements in
managing your business are:
1. Database or contact management software stand alone
2. Load manager spreadsheets see Appendix B
3. Accounting for recordkeeping QuickBooks is ideal or do it manually, using Dome

Bookkeeping for monthly accounting
________________________________________________________________________
71
D. Information Sent to Prospective Agents
D.1. Application to Become a Broker Agent

If you already have an in-house application used for hiring, you may use it; otherwise pick up a
standard application from an office supply store. Usually, creating an application in a Word
document will allow you to modify it and make changes very quickly.
D.2. Summary Broker-Agent Program

[Note: the following information touches on numerous topics that one may find in many
agreements. Review these topics and when you discuss creating your own agreement with an
attorney, you will have already become familiar with some of the important issues.]
Commissions
Here the broker will describe the commission structure. For example:
The Gross Profit (Total Revenue for a load less Total Expenses) for each load will be split as
follows:
Your load and your truck 50% to agent, 50% to broker

Your load and brokers truck 30% to agent, 70% to broker
Brokers load and agents truck 30% to agent, 70% to broker
Payment terms
Here the broker will describe the payment schedule. For example:
Commissions are paid weekly.
Broker will pay agent each Friday (except for legal Holidays in which case payment would be
made on the next business day.) Commissions are calculated on all invoices invoiced within the
prior two weeks. The following Monday after payment, broker will furnish a report showing
which invoices were billed and what the commissions totaled. A week runs Monday to Saturday.
Mileage Software
Here the broker can specify if mileage software will be provided such as PCMiler or ProMiles.
Most brokers and agents do not need sophisticated mileage software and can get by with using
________________________________________________________________________
72
free software like Google Maps or Mapquest or even low cost software like MS Streets and
Trips.
Broker Tools for Agents

Here the broker will list what spreadsheets, documents or Internet services that are provided to
the agent. See Appendix F. Supplemental Information for Agents. If there are no tools or services
provided, broker may ask agents for ideas and what their needs might be.
Agent Marketing Materials

Here the broker may list some suggested marketing materials such as business cards, etc. Most
correspondence is done via email, fax and telephone rather than using letters, envelopes and
snail mail except for invoicing and paying trucks. Some brokers provide a web page on their
website for each agent. Some websites are used for operations and some just for marketing.
For example, some websites allow customers to enter with a particular password where they can
track the movement of their cargo. Decide if and what you might want to provide.
It is not necessary for the broker to provide a lot of sophisticated tools and resources. In fact, it
may be wise to start simple at first.
Broker Software
Here the broker can explain what software, if any, is available. For example, some brokers have
freight broker or dispatch software with capabilities for agents input. Other brokers may not
have industry software for brokers and agents but may have stand-alone database software.
Again, it is not necessary for the broker to provide a lot of sophisticated tools and resources.
Keep it simple if you are just getting started.
Agent Customer/Carrier Acquisition

Here the broker may want to explain who retains ownership of new customers and carriers if
and when the agent leaves. Many brokers allow the agent to take their customer/carrier
database those that have been brought on board by the agent. Other brokers will say No,
newly acquired shippers and carriers belong to me. Some brokers may also have a non-
competition clause. Discuss these issues with the freight broker and your attorney.
Start-Up Office and Equipment Requirements

Office Home or outside the home
Computer most, if not all, computers purchased in the last several years will work well
Fax the 4-in-1 faxes are ideal for faxing, phone, printing, copying, etc. Internet faxing may be
used as a backup.
Internet access high speed
________________________________________________________________________
73
D.3. Summary Freight Agent Daily Operations Guide
Agents shall
Represent Broker in accordance with the Broker-Agent Agreement and other directives
agreed to with the Broker,
Search, identify and get set-up with customers (shippers) and motor carriers,
Learn and understand Brokers credit and payment policies regarding customers and
carriers,
Send set-up packages to each new customer and carrier,
Prepare load confirmations and send to each carrier or dispatcher,
First get broker approval for each new customer and each new motor carrier before
dispatching a truck,
Be the first point of contact with customers and drivers,
Negotiate rates between all parties,
Provide load information to drivers in line with customer expectations,
Monitor and manage each load from pick up until delivery,
Assist in the collection process if and when Broker asks,
Use load boards efficiently when posting, updating and deleting load information
D.4. Summary Freight Broker Duties, Responsibilities and

Obligations
Broker shall
Run credit checks on all new customers,

Pre-qualify all new motor carriers,
Notify Agent of all newly approved customers and carriers in a timely manner,
Receive set-up packages and load confirmations from all customers and carriers,
Provide initial orientation for all new agents,
Invoice customers,
Pay motor carriers,
Pay agent commissions
________________________________________________________________________
74
E. Information Sent to Agents If They Return the
Application
E.1. IRS Form W-9 Request for Taxpayer Identification
Number (TIN)
The W-9 form is completed by the agent and will include the agents name, address, business
structure and the taxpayers (agents) social security number of tax identification number.
If the agent is a sole proprietor, the freight broker is obligated to send a form 1099 at the end of
the year if the broker pays the agent $600 or more.
E.2. Independent Contractor Letter of Understanding (Guide)

Broker (your company name) hereby appoints Agent (Agents name) to represent and act on
behalf of Broker (your company name) as its Agent to perform duties in accordance with the
Broker-Agent Agreement plus other directives agreed to with Broker (your company name) that
may arise from time to time.
Broker (your company name) reserves the right to appoint other agents, and Agent (Agents
name) shall have no right to commissions with respect to the activities of any other agent of
Broker (your company name). An exception would be for a load sharing program, the details of
which would be spelled out in the Broker-Agent Agreement.
It shall be understood that Agent (Agents name) is not an employee of Broker (your company
name) and shall be an Independent Contractor. Agent (Agents name) shall have the sole right to
conduct business in a manner in accordance with Agents (Agent name) discretion.
If Agent, (Agents name) working as an Independent Contractor under this Agreement, employs
subagents or employees or helpers, these persons shall not be, nor will they be, considered
employees of Broker (your company name).
________________________________________________________________________
75
As an Independent Contractor, Agent (Agents name) shall be responsible for his or her payroll
and income taxes, insurance, workers compensation, telephone bills and any other expenses in
the line of Agent duties.
Agent (Agents name) shall receive a form 1099 at the end of each calendar year for all
commissions paid to Agent during that calendar year.
AGENT:
_________________________________________ Date _____________________
(Printed name)
___________________________________________
(Signature)
BROKER:
__________________________________________ Date _____________________
(Printed name)
___________________________________________
(Signature)
NOTE: This letter of understanding could be incorporated into the Broker-Agent Agreement if
desired.
E.3. Broker-Agent Agreement (Outline)

This BROKER-AGENT AGREEMENT (INDEPENDENT CONTRACTOR) dated this
__________ day of __________________, 2014 between
______________________________________________________________ of
__________________________________________________, the Freight Broker
AND
______________________________________________________________ of
__________________________________________________, the Broker Agent
BACKGROUND:
1. The Freight Broker has determined that the Broker Agent has the necessary
qualifications, experience and abilities to provide certain services to the Freight Broker.
2. The Broker Agent is in agreement in providing certain services to the Freight Broker
according to the terms and conditions as set forth in this Agreement.
________________________________________________________________________
76
IN CONSIDERATION OF the matters above and of the mutual benefits and obligations set forth
in this Agreement, the receipt and sufficiency of which consideration is hereby acknowledged,
the Freight Broker and Broker Agent (Independent Contractor) (individually the Party and
collectively the Parties to this Agreement), agree as follows:
SERVICES PROVIDED BY FREIGHT AGENT AND OBLIGATIONS OF FREIGHT

BROKER:
Detailed Daily Operations Guide:

Here the Freight Broker may refer to an Appendix that outlines all the DETAILS. See Appendix
E.4 and E.5.
TERMS OF AGREEMENT: Example: Either party may terminate this Agreement on fifteen
(15) days written, faxed or emailed notice. Upon termination, Freight Broker shall calculate all
commissions due to Freight Agent and make a payout as according to schedule in
_______________________. No commissions shall be paid on shipments received by Freight
Broker after termination of this Agreement regardless of whether the shipment was from a
Referred Customer or not.
Compensation: Here the Broker may outline the split percentages and perhaps the payment
schedule. It might be a good idea to put some topics such as compensation into an Appendix
that can be changed as needed. This way, you can keep the Agreement in tact without having to
change it if and when you want to change compensations. The point is, make the Agreement
simple and treat it as permanent; then make the Appendix flexible and changeable when needed.
Capacity/Independent Contractor: Here the Broker may prepare a clause regarding the fact that
the Agent is not an employee but rather an independent contractor and responsible for his or her
own taxes and expenses except those expenses outlined here or elsewhere in the Agreement. It
might be a better idea to have a separate appendix prepared, requiring the Agent to sign and
date the independent contractor clause. See Appendix E.2.
Modification of Agreement: Here the Broker states that there shall be no modifications to the
Agreement unless agreed to in writing by both parties even for an action or inaction that results
in a failure to enforce or a waiver of any part of the Agreement.
Assignment: Here the Broker states that the Agent is personally obligated to the Agreement and
may not assign any part of his or her rights to anyone else without prior written consent from the
Broker.
Governing Law: Here the Broker states that the Agreement shall be governed by the laws of a
particular county and state, usually the county and state in which the Broker operates out of.
________________________________________________________________________
77
Dispute Resolution: Here the Broker outlines what action will be taken if there are
disagreements or differences of opinion on particular aspects of the Broker-Agent relationship.
Enforceability or Severability: Here the Broker points out that if portions of the Agreement are
held to be invalid or unenforceable it will not interfere with the portions that are enforceable.
Limitation of Damages: Here the Broker states that neither party will be liable to the other for
certain damages due to the breach, expiration and termination of the Agreement.
Force Majeure: This topic relieves a party to the contract of liability that may arise out of acts
of God and other uncontrollable events. The relief may be for a reasonable period of time.
Waiver: Here the Broker states that breaches of any part of the Agreement or any obligation
may not be waived nor any extension of time for performance unless there is a written instrument
in place.
IN WITNESS WHEREOF the Parties have duly affixed their signatures:

___________________________________________________________
(Print name)
___________________________________________________________
(Signature) Independent Contractor
___________________________________________________________
(Print name)
___________________________________________________________
(Signature) Freight Broker
E.4. Detail - Freight Agent Daily Operations Guide
Freight Agent Duties and Responsibilities:

Agent shall be diligent in carrying out agents duties and responsibilities.
Agent shall seek out new customers and tender new customers to broker for broker
approval.
Agent shall send out shipper set-up packages to new customers.
Agent, before dispatching a truck for a load pickup, must first get approval from broker
regarding new customer approval.
Agent shall take orders from customers and take responsibility for accurate dealings.
Agent shall seek out new motor carriers and tender new carriers to broker for broker
approval.
________________________________________________________________________
78
Agent, before dispatching a truck for a load pickup, must first get approval from broker
regarding new motor carrier approval.
Agent shall send carrier set-up package to dispatchers, drivers and other reps from each
motor carrier and agent shall accurately communicate the instructions and requirements
for each load movement.
Agent shall deal with broker on an approved procedure for sending and receiving load
confirmations between the brokerage and shippers and carriers.
Agent may be asked for assistance in the collection of agents customer.
Agent may not tender freight to be moved or broker freight with another broker or motor
carrier while representing broker as the party responsible for payment. Exceptions may
apply.
Agent is responsible for posting, maintaining and deleting loads on load boards.
Agent is responsible for taking check-in calls and final call-ins from drivers enroute
and maintain a written record of such call-ins.
Agent shall monitor each load until final delivery is complete.
Agent shall sign, date and provide Independent Contractor Confirmation at the same
time the Broker-Agent Agreement is completed.
E.5. Detail - Freight Broker Duties, Responsibilities and

Obligations
Freight Broker Duties and Responsibilities

Broker must maintain broker authority and be in good standing with the FMCSA.
Broker runs credit checks on new customers.
Broker notifies agent if and when new customers are good to go after running credit
checks.
Broker may assess charges against agent if agent is negligent in carrying out agent duties
and responsibilities properly.
Broker shall receive customers load confirmation and any contract that might be used.
Broker prequalifies new motor carriers.
________________________________________________________________________
79
Broker notifies agent if and when new motor carriers are good to go after brokers
prequalifying process is complete.
Broker receives motor carriers return set-up package.
Broker shall provide initial orientation for new agents.
Broker shall intervene on load transactions when broker deems necessary.
Broker shall be liable for undercharges made to customer.
Broker invoices each customer and is responsible for collections with possible help from
agent if necessary.
Broker pays motor carriers.
Broker settles commissions for agent payments.
Note: Once agents are used, the freight brokers daily duties will change from doing all the
brokering him or herself. The broker will work on agent recruiting, agent management, and
customer/carrier development.
Before Bringing on Freight Agents, Have the Agent Complete

the Following:
1. Agent Application
2. W-9 Form
3. Signed Broker-Agent Agreement
4. Signed Independent Contractor Letter of Understanding
________________________________________________________________________
80
F. Supplemental Information for Agents (Optional)
F.1. Shipper Telephone Call Log
Search Tool: Google / Yahoo / Thomas.net / Amazon / Other ___________________

Key: NA (No answer), NI (Not interested), LM (Left message), WCB (Will call back), CB (Call back)
Phone No. Company City St Key:

_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
_________________ ___________________________ ____________________ ___ ____
________________________________________________________________________
81
F.2. Shipper Order Form for Taking the Order
Date of Order: ___________________________ Agent ID # ____________________________
Shipper Co. Name __________________________________________________________________
Shipper Address _____________________________________________________
Shipper City, State, Zip ______________________________________________
Shipper Contact _____________________________ (_____) ______-_________________________
Email: __________________________________________ Fax (_____) _______ - _____________
Pick Up City _______________________________________________________________
Pick Date / Time ___________________________________________________________
Destination ________________________________________________________________
Deliver Date / Time _________________________________________________________
Driver to Make Delivery Appointment? (Circle One) Yes No
(If Yes, driver needs to let freight agent know immediately)
Product ___________________________________________________________________
Equipment Needed __________________________________________________________
Desired Temperature if a Reefer ______________________________
Pallets Reqd? (Circle One) Yes No Quantity _________
Lumper Fees? (Circle One) Yes No Amount? __________
Who Pays Lumper Fees? (Circle One) Shipper Broker
No. of Picks ______________ No. of Drops _______________
Additional Pick / Drop Cities / States:
____________________________________________________
__________________________________________________________________________________
_
Rate Paid on Extra Stops:
$________________ x No. of Extra Stops _________ = $ _______________
Total Miles on Load _________________________________
Gross Base Rate from the Shipper _____________________
Fuel Surcharge? Yes No If so, how much?
________________________________________
Rate to the Truck Per Mile (Freight agent figures this):
_____________________________________
Note: If desired, use the backside to record incoming phone calls
________________________________________________________________________
82
F.3. Carrier Profile
Help (Your Company Name) Get to Know You Better

Date of Profile: _______________ Agent ID # ___________________
Carrier Profile
Carrier
Company Name _________________________________ Phone ( ______) _____________________
Address __________________________________________ Fax ( ______) ___________________
City, St, Zip __________________________________ Contact ______________________________
MC # _________________________ Tax ID or Social Sec. # ______________________________
After Hours Contact & Phone (Required) ( ______ ) ____________________________________
__________________________________________________________________________________
Email address ______________________________________ Website ________________________
Insurance Carrier ______________________________ Phone ( _____ ) _____________________
Remit Payment To: (If different from above)
Carrier
Company Name _______________________________ Phone ( ______ ) _____________________
Address _____________________________________ Fax ( ______ ) _______________________
City, St, Zip _____________________________________ Contact __________________________
How long have you been in business? _________ years
Equipment
How many trucks? _______ Climate Control? ________ Space Saver? ________
How many vans? _______ Flat beds? ________ Reefers? _________ Other? _____________
Drivers
Employees __________ Owner Operators? ____________
Territories
Lanes most desirable? _______________________________________________________________
_________________________________________________________________________________
Note: The agent can fill out the upper portion to include the MC# and send the form to the broker to
enable the broker to start prequalifying the carrier. If the carrier is approved, the agent can then collect
more information or dispatch the truck for a pick up.
________________________________________________________________________
83
F.4. Other
Note: Here the broker could prepare and insert helpful information such as:
Benchmarks used to evaluate customers,

Benchmarks used to evaluate carriers,
Specific questions to ask shippers when prospecting,
Best time to prospect for customers ..
Or the Broker may want to prepare some motivational information such as:
Common Characteristics of a Successful Freight Agent

Seven Mistakes Freight Agents Make When Calling on New Customers
________________________________________________________________________
84
John D Thomas, President
Atex Freight Broker Training, Inc.
El Paso, TX
About the Author:

The Definitive Guide to Growing Your
Freight Broker Business Using
Freight Agents
John D. Thomas, founder, President and sole owner of Atex Freight Broker Training,
Inc. has over 30 years experience working with small business start-ups.
Currently, he provides comprehensive, one-on-one, step-by-step freight broker
training and has been doing so for over ten years.
Clients may train in one of three ways: (1) Over the telephone and Internet, (2) live
in El Paso, Texas or (3) with the Home Study.
John provides a good selection of free or low-cost information products on his website
and blog.
His website can be viewed at http://www.AtexFreightBrokerTraining.com and he can be
reached by email at: info at AtexFreightBrokerTraining.com
This information resource is under copyright protection and may not be reproduced for
resale or for any other purpose.
________________________________________________________________________
85

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The Definitive Guide to

Before You Begin

The Concept of Agency

The Application and Hiring Processes

Growing Your Business Even More

Growing Your Business

Now, lets get on with more information on using freight agents.

This is a partial list of the topics in this eBook:

The Business Model

A business model starts with a product or service, a

A Brokers Product or Service

A Brokers Target Market

The key is to find receptive markets. Ideally, you

Marketing Strategies and Business Development

One of the most powerful and effective ways to

A marketing strategy, when effective, leads to business

You may want to provide incentives to agents if

An Assessment of Resources and Potential Obstacles

Three points to be made: one, know what capital you

Nevertheless, potential obstacles have to be identified as accurately as possible and decisions

Lets look at several examples.

Creation of Metrics to Measure Overall Performance

What metrics or benchmarks will help measure overall performance?

Three such benchmarks are:

When you enter the freight broker business (or any

How an Agency is Created

This authority identifies what the agent can and cannot

There are laws governing relationships

However, it is crucial to understand that bringing

Setting Up and Managing Operations the

If you ARE new and HAVE NOT completed these

Setting Up and Managing Operations the

What Services, Software or Tools Will Be Provided to Agents?

Regardless of which spreadsheet you use, you

And, trust me, if you have a list of customers

The Broker-Agent Agreement

The Independent Contractor Statement of Understanding

What is the Commission Structure?

But you may find commissions that run

Its not uncommon for the broker to absorb the cost

What are the Standard Operating Procedures for Acquiring New

The agent does NOT want to dispatch a truck on a

The broker needs to communicate to the agent

Suggested Guidelines for Monitoring and Evaluating Customer

Communications Many shippers and brokers use people with excellent

Suggested Guidelines for Monitoring and Evaluating Carrier

Are you prepared to deal with these differences?

What if your agent asks, Is there a career path

What will your answer be?

Knowing What You Want

Be aware that brokers may encounter agents or

Independent Contractor or Employee

As an independent contractor, the agent is essentially

The new health care law is forcing employers to

Logistics and Supply Chain Knowledge or Experience What about LTL,

If an agent can only master a couple of these, he or

Well, why not?

Contact Freight Broker Trainers Dont neglect contacting Freight Broker

Getting prospective agents to complete the application might be considered a destination.

The Application and Hiring Processes