What is the difference between a freight broker and a freight agent?





The biggest difference is that a freight agent is typically an individual who acts as an independent contractor salesperson for a freight broker. Freight agents have their own customers and usually work on commission. A portion of the freight agent's gross revenue goes to the freight broker in exchange for administrative support, flow, insurance, liability buffers and the reputation that comes with the broker's name.

Brokers require a license from FMCSA and a surety bond. They are responsible for the financial aspects of the company (i.e. invoicing shippers, paying carriers, extending credit, claim assistance, paying agents etc.). Freight brokers can range from a one man operation to a large multinational company with billions in revenues. Brokers are responsible for only hiring motor carriers that meet the FMCSA guidelines including authority, insurance and safety standards and that payments due to motor carriers are not unreasonably withheld. Ultimately, freight brokers assume the risk of granting credit to customers so it's critical for them to check and monitor a customer's credit.

A freight agent is responsible for sales and matching carriers with customer needs. Most agents work from their own homes, under the direction and authority of a licensed freight broker. Thus they have little or no liability, but are able to earn a significant income based upon the profit their customers generate. Agents interact with both shipping customers and motor carriers in an effort to ensure their customers' freight is picked up and delivered on time, in good condition with no problems. Most of a freight agent's day consists of soliciting new customers, providing freight rates, sourcing carriers, negotiating with shippers/carriers, dispatching trucks, scheduling pickup/deliveries and solving problems that could potentially delay or damage a shipment.