Logistics provider, 3PL, Intermediary, Freight Broker – these are all words the freight industry uses to describe businesses like Shaker Logistics, whose main goal is to facilitate and execute safe, on-time shipments.
Shaker has served its customers reliably for decades, but unfortunately, there are still too many bad actors in the freight industry. Shippers who’ve had a bad experience sometimes paint all freight brokers with the same broad brush of suspicion. We frequently work with shippers who have been burned in the past by bad brokers. Matt Janeski, Director of Logistics Services at Shaker, shares some of the advice he gives to new shippers who are questioning whether partnering with a freight broker is worth it.
Myth of the Middleman
As a vital link in the supply chain, logistics providers are up against some serious stereotypes. The stigma against freight brokers mainly comes from something Matt calls “the middleman factor.”
“People see brokers as someone standing between a shipper, who has something to move, and a carrier, who has the means to move it,” Matt explains. “They view us as someone who’s trying anything to take a cut of the profits as a shipment moves along, but the reality is this: if we don’t add value, we can’t take a piece of the pie.”
Shippers have to manage operational challenges and don’t have the time to research carrier rates, find trucks, schedule appointments, or track loads. While some larger companies have a designated transportation procurement specialist, they’re often focused on other aspects of the supply chain, like inbound materials, warehousing, and manufacturing. A good freight broker functions as a built-in logistics department, taking care of shipments from pickup to delivery so that the shipper can focus on what they do best.
“A skilled freight broker also has something to offer to carriers,” Matt said. “After years of experience, we know what matters to carriers and how to work with them towards success. We know how the industry is for them at any given time, so we stay informed on market carrier rates and transportation trends. We form relationships with these carriers and leverage that so everyone gets a fair rate.”
Freight Brokers as Problem Solvers
A good freight broker also acts as a buffer between the customer and industry-specific conflicts. For truck drivers and dock workers, the work is physically and emotionally exhausting. While drivers are working, often hundreds of miles away from home, every minute and every dollar counts. If there’s a miscommunication or delay at the dock, tensions spike.
“Conflict de-escalation is part of the job,” Matt said. “I’ve had instances where I had one phone in each hand, talking the driver and the dockhand through an argument until we could get the job done. Collectively, we understand how rough it is on the driver and manual labor side. We bear it so the customer doesn’t have to.”
The Top 5 Common Misconceptions
With all the value that freight brokers add, there are still misconceptions about using them. Here are the top 5:
“Working with a freight broker is more expensive than working directly with a carrier.”
Customers often think that carriers give shippers cheaper rates than freight brokers, buying into the myth that freight brokers are middlemen who jack up pricing to get a bigger cut.
The truth is that working with a freight broker allows for flexibility, which can actually save money for shippers. Shippers working with contracted carriers are exposed to the volatility of the freight market; anything from inclement weather to a surge in orders can blow up their routing guide with higher carrier rates. As a freight broker, we give our customers access to immediate capacity, which can allow them to tap into an advantageous market at any time. When you have more carrier options, you have the option to save money.
The “Shady Broker” Archetype
Shippers who’ve been burned in the past by a shady broker are right to be wary. Scammy brokers, though just a tiny fraction of the industry, can create havoc and real economic consequences for customers. Whether it’s simply a lazy broker padding rates without adding extra value, or an outright fraud trying to double broker a load, these schemers damage the entire industry. But the only freight brokers who will survive long-term are those who are honest and offer real value. Over the 30 years we’ve been in business, we have adapted our carrier network and developed expertise to serve the specific needs of our customers. And leading with integrity means that we sometimes have to eat fees incurred when we make a mistake, or have tough conversations with carriers and customers when a mistake happens.
“Carriers never want to work with freight brokers.”
Carriers in the freight industry have their own misperceptions about freight brokers, and a common one is that freight brokers are dishonest. Truck drivers sometimes make assumptions that a freight broker is lying about the facts of the shipment, like the dimensions of the freight or the drop-off appointment time. Bad brokers quickly gain a reputation among carriers, who will refuse to haul loads for them. That can be a problem for shippers when capacity is tight. But on the flip side, good freight brokers are a lifeline for carriers, and those who have proven they are trustworthy will often see carriers jump at the chance to haul their loads. We develop relationships with carriers by being honest with them about freight, rates, schedules, and obstacles. This allows us to secure dedicated capacity or last-minute options – when we approach our carrier network, they know from experience that we’re being upfront with them.
“Over the course of a shipment, freight brokers have less visibility and oversight of the freight than carriers do.”
While it’s true that freight brokers aren’t sitting in the truck with the driver aware of every turn and traffic light, technology today lets us get pretty close! Because we’re responsible for the shipment, as a freight broker we make sure that load visibility is a critical part of our process. Real-time tracking tools enable us to see on a map where a truck is at any point. We also stay in regular contact with the carrier via text and phone, and work with them to relay changes to and from the driver. For shippers with a lot of operations responsibilities on their plate, tracking every load every minute of the day and trying to communicate changes or delays would create an entirely separate job. Relying on a freight broker, who has the tools and team to stay on top of shipments, is a much better use of resources.
“Freight brokers are not professionals.”
The misconceptions we’ve mentioned above lead people to believe that third-party logistics providers are unprofessional organizations staffed by individuals without professional training. One look at our team at Shaker can disprove this notion. Our logistics specialists undergo intensive professional training on the software systems we use to track and manage shipments and accounts. Our team also has a high number of Certified Transportation Brokers (CTB), logistics specialists recognized for their commitment to excellence and professionalism by the Transportation Intermediaries Association (TIA). After a minimum of two years of industry experience logistics specialists take a 16-week course, pass a rigorous exam, and commit to the TIA code of ethics to become a CTB.
Hand Off Your Logistics Challenges to a Partner You Can Trust
Despite these myths and misperceptions, the reality is that, in most situations, shippers can benefit from the expertise, network, process adherence, technology, and diligence of a competent freight broker. Relying on a strong logistics partner returns a value far exceeding what a shipper could achieve on their own.
Experience the difference of working with a high-quality logistics partner and let Shaker Logistics handle your shipping challenges today!