Is being a freight broker stressful? (2024)

FAQs

Is being a freight broker stressful? ›

It takes a great deal of resolve and persistence to overcome the daily obstacles. It's the reason burnout and turnover for freight brokers are so high. To avoid the stress that eventually causes freight brokers to burn out before reaching their goals it is important to realize what's important and what isn't.

Becoming a freight broker is a relatively easy and low-cost way to start a business. Still, from there, you're facing a steep learning curve, a fiercely competitive industry, and tight margins—a perfect storm for two-thirds of new brokers who fail in their first year. But it's not all doom and gloom.

Your work as an Independent Freight Agent presents a unique array of stresses. Perhaps the most challenging of them is finding a healthy work-life balance.

You Don't Have Complete Control Over the Shipment

One of the biggest downsides to using a freight broker is not having total control over the shipment. Once the load is given over to the broker, the shipper's ability to manage that load may be hindered.

Competitive Salary

On average, the yearly freight broker salary in the U.S. is $71,500 ($36.67 per hour). Entry-level positions begin at $45,000 per year, while most experienced professionals earn up to $107,500 per year.

Freight brokers make their money in the margin between the amount they charge each shipper (their customer) and what they pay the carrier (the truck driver) for every shipment. Although it varies from one transaction to the next, healthy freight brokers typically claim a net margin of 3-8 percent on each load.

Freight broker work environment and schedule

Freight brokers typically work in dynamic and fast-paced environments, typically in an office setting. Some freight brokers run their own businesses and work for themselves, while others work for established brokerage firms.

Freight agents have less liability in comparison to a freight broker. Freight agents need freight brokers to operate, whereas freight brokers can operate without freight agents. A freight broker will have a more consistent brand look and feel across its office(s) versus freight agents that operate under the broker.

What is the Economic Outlook for Freight Brokerages in 2023? Strong but shaky is a good phrase to describe the economic outlook for freight brokerages in 2023. With more businesses emphasizing supply chain efficiency to ensure streamlined operations, demand for freight broker and 3PL solutions should remain strong.

How profitable is a freight brokerage? ›

Depending on your expertise, your salary range can be anywhere from 10% to 35% commission for each truckload. Ultimately, the average broker ends up getting margins of around 15%. This percentage is a portion of the total amount of money that customers give you. So, how much do freight brokers make?

According to a Freight Waves survey, the average commission is 13% to 15% of a load's net revenue. Example: A shipper pays $4,000 to a licensed freight broker to move a load. The freight broker negotiates $3,000 with the trucking company to transport the load, leaving $1,000 net revenue.

These professionals know how to secure loads with pre-qualified carriers through their 3PL. Freight brokers help carriers optimize their resource productivity. In other words, by doing things like scheduling back-hauls and more effective routes, each truck is doing more work for less money.

Freight broker pay can be very different based on the company, commission structure, etc., but according to Freightwaves, the median freight broker pay in 2023 is $40,000 salary + 13.2% commission on gross profits (1). NOTE: The higher the profit margin the higher the W-2 freight broker pay will be.

Yes, freight brokers can indeed make 7 figures – many have successfully grown 6, 7 and even 8 figure businesses.

Further, the W2 model of freight brokering shows an even more dramatic statistic. Nearly 95% of newly hired brokers turnover within the first 6 months.