How to Know if Your Freight Broker is Legitimate

In the logistics industry, many small businesses, carriers and suppliers use freight brokers as intermediaries to help with securing the best possible shipping options and cost.small business freight broker Freight brokers can also assist small businesses with navigating state and federal transportation and logistics regulations, as well as the appropriate reporting and paperwork needed to meet these requirements. However, with more than 13,000 licensed and bonded freight brokers in the US alone, finding the best-fit help can be a challenge. Additionally, not all companies or individuals holding themselves out to be licensed freight brokers are, and this can expose your business to fraud.

Before selecting a freight brokerage to work with for shipping needs, be sure to follow these recommendations to ensure your selected partner is legitimate.

Check References

Any freight broker that has been working the transportation industry for some time will have a list of references from past satisfied customers. If you are considering using a freight broker for shipping needs, be sure to ask for references up front. A broker that refuses to provide names and contact information of previous customers, or one who has little to no reviews online, may not be the best fit for your business.

Review Credentials

One of the simplest ways to check if your freight broker is legitimate is to do a quick search online. All licensed freight brokers are required to be registered with the Unified Carrier Registration Program. This is a federal program that is maintained on a state level for all motor carriers, freight forwarders, and brokers. The registration process involves the collection of fees and a check of legitimacy before approval, so this is a smart way to evaluate a potential freight broker partnership up front.

Request Bonding Details

As part of a freight broker’s state requirements, a surety bond must be put in place to operate legally. A freight broker bond in the amount of at least $75,000 is mandatory, and bonded brokers should be able to provide the details of their bond with relative ease. A freight brokerage bond protects your business from unlawful practices that may cause financial loss, so it is important to know this safeguard is in place before hiring a new freight broker.

Keep a Database

Another strategy for ensuring a freight broker is legitimate is maintaining an up-to-date database of the brokers your business has partnered with in the past. Freight brokers may change business details, such as contact information, website, or phone number, over time, making it difficult to remember who was successful – and who wasn’t – with previous work. Having an easily accessible database of freight brokers, both current and past, is beneficial in continuing to work with those who deliver on their promises.

Trust Your Gut

The best step you can take above and beyond these recommendations is to go with your gut as a business owner. If something feels off or untrue about a potential freight broker partner, consider working with a different choice. Several options for freight brokers exist, so opting to not work with one is not the end of the world. Instead, it may save your business from costly errors or delays in shipping and transportation over the long term.

Freight brokers can be an integral part of the transportation puzzle for many businesses, big and small. However, it is important to know that the broker you partner with is the best choice for your business. Be sure to check references and registration data, along with bonding details before agreeing to work with a specific broker. Follow up with checking your own database of previous freight broker relationships, and above all else, trust your intuition on who is best fit for partnering with your business.

 

About Eric Weisbrot

Eric Weisbrot is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry under several different roles within the company, he is also a contributing author to the surety bond blog.