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How to Become a Freight Broker: Your Ultimate Infographic Guide

HOW TO BECOME A FREIGHTBROKER A Step-By-Step Guide Freight Brokers Keep the Economy Running Freight Brokers assist the shipping industry by establishing connections between shippers and authorized motor carriers. Being the indispensable middlemen, freight brokers play an important role in the movement of cargo in the U.S. by taking responsibility of a vital part of the shipping process. Freight brokers help shippers find the most reliable motor carriers They help motor carriers fill their trucks / maximize their loads 1 They can find the best shipping rates They can find the fastest delivery options They track freight and follow up on the legal compliance of transportation The Road to Becoming a Freight Broker STEP Gain Industry Experience and Study 01 Learn on your own by choosing the right training books or go to a freight broker training school. Good training books and classes can teach you how to find shippers, carriers, and agents. They will help you understand how to move freight at a price that's profitable for you and the carrier. You will also learn how to stay in compliance with federal laws and how to operate your business successfully. E Time: At least 3 Weeks 9 Cost: $0 - $3,000 STEP Choose a Company Name and Register Your Business 02 Choose a representative name for your company by checking the US Patent and Trademark Office. Then select the right type of entity for your business, keeping in mind that registering as a corporation (INC) is highly recommended. Register your business with your local business license department. Then get your Tax Identification Number from the Internal Revenue Service. Time: Up to 1 Month O Cost: $300-$1,000 Busines Plan STEP Develop a Business Plan 03 Do an initial market research and make sure you have a clear business plan that will guide you to success. Choose your market niche and tailor your marketing strategy and efforts to meet that specific market segment's needs. If you can afford it, you can also hire a business consultant to help you out with the business plan. IDEA ANAUSIS SUCCESS O Time: Avg. 1 Month Cost: $0-$1,000 STEP Find the Right Carriers 04 #1 Identify the carriers that provide the right services for your niche and customers and make sure they are reliable. To find trusted partners, use dedicated online directories, your networking skills, or start with an online search. O Time: Ongoing O Cost: $0-$300 USDOT#575274 STEP 05 Apply for a USDOT Number and Get Your Broker Authority You need your USDOT number when applying to become a freight broker with the FMCSA. Once your Application for Motor Carrier Operating Authority (OP-1 Form) has been approved, the FMCSA will send you your MC number. & Time: 20-25 Days $ Cost: $300 For online applications STEP Get a $75K Freight Broker Bond (BMC-84) LANCE SURETY 06 The bond demonstrates the financial strength and responsibility of a broker, guaranteeing payment to motor carriers and shippers in case a broker fails to comply with their contracts and agreements. GET BONDED Time: Same day Cost: $1,500 - $3,750 Annual cost with good credit score STEP Obtain Contingent Cargo Insurance and General Liability. 07 Some shipping companies might require you to carry Contingent Cargo and General Liability Insurance for added protection. The usual insurance types include filing with the FMCSA Form BMC-34 for loss and damage and Form BMC-91 or BMC-91X for bodily injury, property damage and environmental restoration. E Time: Up to 2 Weeks Cost: $700-$1,400 First quarter STEP Designate Agents for Service of Process 08 You have to choose your process agents for each state you do business in. You can do s by filling in and submitting Form BOC-3 to FMCSA. @ Time: Up to 1 Week S Cost: $0 STEP Get Your Equipment 09 The essential technical gear that you need at first includes a computer, a printer, a copy and fax machine, a landline phone and a mobile one, some office supplies - and a solid internet connection. You might also want to look into freight brokering software. @ Time: Up to 2 Weeks O Cost: $6,000-$22,000 STEP Get Enough Initial Operational Capital 10 Having enough startup finances is a must because you might have to pay truckers for the shipment before you've received the payment from the shipper. You can do it with your own cash or open a line of credit as a an emergency fund. Time: Same day Cost: $5,000-$250,000 A line of credit has an annual fee + interest rate of 8% - 18% A decision for a line of credit can be made within 15 min STEP Market Your Business 11 Create your marketing strategy, add a character to your business by designing a great logo and visual identity, build a fast and representable website, and print appealing marketing materials using coherent visuals. FREIGHT BROKER O Time: Up to 1 Month OCost: $500 - $1,500 ERGA LANCE SURETY Lance Surety Bond Associates is a surety bond agency that helps BOND ASSOCIATES, INC. freight brokers get bonded nationwide. Sources: Step 1 Step 6 https://www.fmcsa.dot.gov/registration/get-mc-number-authority-operate https://www.suretybonds.org/blog/4-top-freight-broker-training-books/ https://www.suretybonds.org/blog/top-5-freight-broker-training-schools/ Step 7 http://www.entrepreneur.com/article/37928 Step 2 http://www.uspto.gov/ https://www.irs.gov/ Step 8 https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/BOC-3%20Form%20508%20rev.pdf Step 3 Step 9 http://smallbusiness.chron.com/cost-writing-business-plan-2928.html http://www.entrepreneur.com/article/37928 Step 4 Step 10 http://www.entrepreneur.com/article/37928 http://www.bankrate.com/finance/personal-finance/borrowing-with-personal-lines-of-credit-1.aspx http://www.entrepreneur.com/article/37928 Step 5 https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/op-1-instructions.pdf https://www.fmcsa.dot.gov/registration/get-mc-number-authority-operate Step 11 http://www.entrepreneur.com/article/37928 CREATED BY presitely BROKER AUTHORITY

How to Become a Freight Broker: Your Ultimate Infographic Guide

shared by lancesurety on Jan 11
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Check out our infographic below for a visual representation of the various requirements for freight brokers and what else you need to do or know when becoming a broker!

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