MODULE 4: Who Are The Shippers

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The shippers, customers, or consignors are the individuals or companies in which you, the freight broker, get/procure the loads, freight, cargo or commodities from by way of contracting with them.  The contract between a shipper and a freight broker is called a Shipper/Broker Agreement.  The Agreement is included in what is called the Shipper Packet along with the Broker's Authority, Broker's Bond, W9 and perhaps any supplemental insurance among other things.

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The Shipper/Broker Agreement is usually entered into once a shipper is convinced that a freight broker can meet their requirements.  Shippers usually require freight brokers to either rate bid on a lane (a pickup location to a destination location) or provide a rate quote for a lane, meaning they (shipper) want to see if the freight broker can provide capacity (owner operators/carriers) for the shippers at a satisfactory rate.

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If the shippers are satisfied with the numbers from the rate quote or lane bid, a load tender will be sent to the freight broker to either accept or reject.  If accepted, the freight broker is now responsible for meeting the requirements of the tender.  The load tender contains specific details of the load including what the shippers has agreed to pay the freight broker.

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The customers of the shippers are the receivers or consignees, in which freight will be picked up from the shipping facilities (origin) and delivered to the receiving facilities (destination).  Consignees (receivers) purchase commodities, freight or products from specific manufacturers (or shippers, who have made those products to be sold to the receivers).  If the shippers use freight brokers to assist with getting the cargo to the receivers/consignees (or shipper's customers), then it is the freight broker's responsibility to source the capacity (in other words, finding owner operators or carrier companies) to accomplish this according to the shipper/broker agreement.

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In this module, we also discuss and try to get an understanding of who your customers (shippers) will be and the ones you should initially go after starting out as a freight broker or a freight broker agent working under the authority of a freight brokerage.   Small to medium-sized companies or even mom and pop companies are a good start for companies to target.

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TIDBITS IN BROKERING

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• Niche – find a niche for the equipment type and commodity for that equipment type to start out with and focus on that.  For example, it is said that Flatbeds are the easiest equipment types (Flatbed, Dry Van, and Reefers) to begin with.  Lumber loads and/or Steel loads are good starts under the Flatbed category.

 

Remember the 4 R’s of Brokering:

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                Research – once your niche is determined, begin researching the companies within                    the niche based off of equipment type and commodity.  Get as much information as                    you can about them in order to appear knowledgeable.

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                Reach Out – reaching involves beginning the process of prospecting for new                                  customers/shippers.  Here is an interesting article on how find shippers and the                            various ways to: https://truckerpath.com/blog/how-do-freight-brokers-find-shippers/?fbclid=IwAR3D8i_AJsspk1YxtSLwGFFIbhjOYAVc0kBwnWGfq31MAQym1v0-avR0SkU

                                Some Ways of “Reaching Out”:

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                              Cold Calls – cold calls are generated from shipper lists (either free or                                                purchased), Google, LinkedIn, etc.  Ask how you can help them with a                                                shipping issue they may have and to be added to their freight shipment list.                                    If approved customer, add to your TMS system.

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                                Local Visits – with local visits, of course you want to leave something from                                      the visit such as a pen, business cards, flyer, and obviously a shipper packet.                                    Ask to speak to someone in shipping or the logistics manager, etc.  See what                                  their problems are and how you can help solve it.  Ask to be place on their                                        freight shipment list.  If approved customer, add to your TMS system.

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                                Emails – emails are obtained from purchased lists or free from online                                                searches, such as MacRae’s Blue Book, Manta, or Thomas Net.

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NOTE:  At this stage is where you send out the Shipper Packet for set up

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                Relationship – establish relationships with your customers by solving their problem                    and moving their freight on time, without any damage or claims, etc.

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                Return – return means by build relationships through fulfilling and solving your                            customer’s issues, you receive more opportunities for more business from the                                customer.

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• Educate yourself about the company – once a niche is discovered and considered, begin educating yourself about the company, their equipment type and what they haul.  That way, when you reach out to the prospect (via cold call, local visit or email), you will have information needed and look as if you know what you are talking about.

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• Build Relationships – building relationships entails establishing your brokerage as the go-to brokerage through successful movement of loads for your customers (shippers).  Then, as you move loads consistently, the customer will consider giving you more loads to move because you have proven yourself reliable.