How do freight brokerages grow so quickly?

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With over 20,000 freight brokerages currently operating, what separates the successful brokerages from the brokerages that crash and burn? You can hypothesize a number of factors, and sure they probably have an impact, but there is one big thing that drives the growth. Recently, FreightWaves posted an article that highlighted the growth of a particular brokerage, and the commentary that goes along with it really hits my point.

“Now more than ever, supply chains are more complex and on-time performance is crucial. With so much talk about digital brokers and automation, it is clear that technology has made an impact on logistics services. But there’s a strong argument to be made that a key element supporting 3PLs’ hockey-stick growth is their people.

New freight brokers are typically fresh college graduates with little to no sales experience and no direct knowledge of transportation and logistics. Managers have to educate new hires about the industry—everything from equipment types to dimensions and weight limits and the quirks of specific markets—while at the same time giving them the confidence to move freight and work with difficult customers.”

And then there is the growth. The most successful brokerages, such as Logistic Dynamics, Inc. (LDI) are growing exponentially year over year.

“How do brokerages pull that off, and how do they do it over and over, growing a highly successful sales force exponentially year after year? Some brokerages rely on mergers and acquisitions to make it happen, but others rely on organic growth and an investment in their people.

The freight brokerage life, of course, is not for everyone. Not everyone can maintain a positive attitude under pressure, and not everyone wants the opportunity to make more money based on how hard they work—that scares some people. When brokerages first start, they need to bring in brokers quickly to cover freight and take care of their growing shipper accounts. Some of those news hires work out, and some don’t. But as the companies grow, they gain more insight into exactly what kind of person they’re looking for, and team leaders grow more experienced in learning how to coach specific personality types.

Once a new hire gets trained up and starts moving freight, the company still has to find a way to keep the broker motivated. The intensity of the industry can be challenging. Finding ways to gamify aspects of the job brings out the competitive drive in employees while also increasing service levels. High-growth 3PLs we’ve talked to have annual games and sport-style competitions between teams of their brokers, display fun announcements throughout the day to let everyone know who’s doing a great job, and keep their teams tightly knit with plenty of opportunities to socialize.”

Bottom line – it’s the people. Whether the brokerage is an in-house model with employees or an agent-based model with 1099 independent agents, the people are what set the company up for success. From the top leadership, to the support staff, and extending all the way out to the remote agents – quality happy people are crucial and an element to success.

What do you think? What makes or breaks the success of a freight brokerage?

Are you an experienced freight broker or logistics account executive?

Logistic Dynamics Inc, or simply “LDI”, is an asset-based 3PL that runs an agent-based model where our sales people are independent business owners that use our industry-leading TMS with a mobile app, extensive truckload capacity, and financial backing. We are a $200M company that still embraces the agent model and has an exclusive family feel. Our agents are on a profit sharing arrangement, and we're offering our most aggressive splits and upfront compensation incentives to new agents.

What we offer:

• Aggressive Splits
• Nationwide FTL Capacity
• Full-Service support team
• Cutting-edge and ever-evolving Technology

Minimum Requirements:

• Must have a book of business
• Must have experience in freight brokering or freight sales

Some Highlights:

• Work from home
• Qualifying candidates earn a promotional start at 80% commission
• Weekly Pay - commission are paid after we invoice the customer
• Free TMS and Mobile App
• Auto-Posting to load boards
• Full scale support team with overnight and weekend hours
• Advanced technology with digital rate sheets, GPS tracking, and auto truck matching
• Available in-house dispatchers to help you cover more loads
• Health insurance available
• Very low customer saturation with customer protection on your accounts
• Sales contests and biannual corporate conferences
• Dedicated marketing team with free marketing materials