Like any other business owner, truckers also need to sell their services and find customers. Unlike other businesses though, truckers need customers with freight in the right place, and at the right time. So, building a network of shippers with freight at the right place at the right time can be quite challenging. Many of the truckers just do not have the time and resources needed for the truckers to build this network of shippers and lanes. So, if you want to act as a freight broker for truck drivers. You need to match the goods that need to be shipped with various trucking companies that do the shipping, and you will need to have a freight broker license or a load broker license.
What does a truck broker do?
A truck broker, also known as a freight broker act as a middleman between a shipper and a carrier. They can arrange for you a reliable freight carrier within their network to service shipments. Becoming a truck broker is a great convenience to increase your revenue. Now is as good as any to get your truck broker license. Besides making a good salary, truck brokers are necessary when it comes to transporting goods and cargo from one place to another. So if you wondering how to become a truck broker? How to get a broker license for truck drivers? Or why adding truck brokering to your business is a good idea for you, contact our experts at LGOA today.
Why does one need to become a truck broker?
If you get a call for a big load – it’s a great endeavor. The problem is that all of your trucks are already on the road with some other loads. Thinking about all the revenue you get from the previous load. This is where the role of truck brokering (or freight brokering) comes in the shipment of your consignment from one place to another. So, if you have a truck broker license from the FMCSA. You can sub that load out to another trucking company, and take a small commission in return for this favor. Typically, a trucking company can only negotiate their freight, which gives them a two-part opportunity cost, the lost job itself, and the brokering fee they could have gathered for arranging alternate cargo delivery.
How one can get a broker license for truck drivers?
You do not need to take an exam or any background check to receive a broker license for truck drivers. Apart from this, there is no age limit. The only thing you need is to obtain proof of insurance of $10,000, in the form of either a surety bond or a trust fund. When you have this insurance, you are liable to fill out and send the Federal Motor Carrier Safety Administration OP-1 application for getting Motor Property Carrier number and Broker Authority along with the non-refundable application fee of $300. Apart from this, you also need to fill out the BOC-3 form, which designates your process agent, or legal representative.
Now after submitting your application form. You need to wait for the FMCSA to issue you an MC or motor carrier number. This number will endeavor you to start brokering loads. It is especially easy to add a brokerage authority to your company if you already have a trucking authority.
How to be a trucking broker in California?
Let us pre assume that you are working for a trucking broker for some time, under the broker’s license, and now looking to launch your own company. Now the question arises how to be trucking broker in California? To become a trucking broker in California, you first need to get licensed as a trucking broker yourself. The first step in getting a federal trucking broker’s license, formally known as a freight broker’s license, is to register with the Unified Registration System, which involves paying an application fee (currently $300). There is a 10 day waiting period, during which you will receive an MC number, typically called an MCN.
Your next crucial step is to purchase a $75,000 BMC-84 bond. Apart from this, you can put up $75,000 in cash or credit. But most brokers do not want to tie up the assents they might need as operating capital. Purchasing a bond needs only an annual premium which is a small percentage of the $75,000 bond amount. Once you have your MCN and a $75,000 surety bond, you can complete your online application for a trucking broker’s license. As a part of that application process, you will also need to name a process agent for each state that you will be operating in.
Using truck brokering to increase revenue is just a smart business. Our user-friendly truck brokerage software assists you to find a broker for truck drivers and also helps you to grow your business in an organized fashion.