Get Freight Broker Training in California
Are you ready to get started on a great new career? Freight broking is booming business with solid opportunities to work independently from your own home. California is an excellent base to start, with over 10% of all U.S. shipments, with a value of almost $1.5 billion originating in the state. Almost 70% of these goods were moved by truck and freight brokers are involved in almost all these shipment deals. On this page, you’ll discover everything you need to know about freight brokering – how to become a licensed broker/agent – and freight broker training courses in California.
The state is a hub for freight movement with more imports entering the U.S through California than any other state. California has 12 seaports, 12 major cargo‑handling airports, and three land ports of entry with Mexico. Furthermore, its large agricultural sector is a significant exporter of goods. Highways and trucks form the backbone of California’s freight transportation industry and a massive logistics operation of which freight brokers play an integral part. One important reason of this is the fragmentation of the industry. More than 90.0% of all industry enterprises in California estimated to be owner-operators.
What are freight brokers and what do they do?
When goods arrive at one of California’s busy seaports or when food produce is placed in a farm’s warehouse, ready consumption, shippers work to get that freight to its destination. To do they need carriers. Carriers can be large national or international trucking companies, or small owner operators with a single truck. Shippers work with freight brokers/agents to select the right truck to deliver the goods, taking account of the truck’s availability, the load type, the delivery dates and the destination, be that within California or in another state.
The freight broker or agent will find carriers, either through the brokerage’s existing carrier database, or searching online on load boards, which provide useful tools for matching cargo to trucks. Freight broker courses provides in-depth training on the use of these boards.
Once an appropriate truck has been found, the broker negotiates the shipping rate with between the shipper and the carrier and agrees the delivery date and other conditions attached to the shipment.
The freight broker or agent then monitors the shipment, ensuring all conditions are met: that the goods arrive on time, in the right place and in their original condition. When conditions are not met, the freight broker/agent will handle any claim arising.
How much does a freight broker earn per load? For the services, the freight broker takes a commission, which is an agreed percentage of the shipment cost, being perhaps 5% for large loads, or 25% to 30% for small contracts.
The difference between a freight broker and a freight agent is that a freight broker is required to have a license (MC Authority), a surety bond and adequate insurance. A freight agent performs all the same work as a freight broker and perform it on behalf a broker, but do not carry liability. Typically, freight agents earn a larger share of the shipping commission, but freight brokers earn more in total as they handle many transactions with many agents.
Many freight brokers specialize in specific load types – either full truckload (FTL) or less-than-truckload (LTL). Some specialize in refrigerated container trucks (reefers) for foodstuffs, or specific hauling types such as flatbeds, lowboys, drop deck or oversize.
Some freight brokerages are large national or multinational operations, offering full third-party logistics serviced (known as 3PL or TPL) while others are one person businesses run from home.
How to Become a Freight Broker in California
To become a licensed freight broker in the state of California, you are not required to hold any specific qualification or training, other than a high school diploma or GED. The state has no specific license requirement. All California freight brokers are required to have a Federal Motor Carrier Safety Administration (FMCSA) license. The FMCSA is part of the United State Department of Transport (U.S DOT).
To obtain a license, prospective freight brokers must first register their business name and apply for a U.S DOT number. Then they can apply to the FMCSA for a broker license. The cost of the application is $300, but at this point the business must also demonstrate that it holds a $75,000 surety bond or $75,000 trust fund, as well as cargo and general liability insurance. They must also notify the designation of freight agents that will represent them in every state in which they intend to broker freight.
As an independent freight broker, the $75,000 surety will most likely be your largest cost. The cost will depend on the age of your business and your credit rating. If the brokerage’s business is long-established and has an excellent credit rating, the cost of the bond may be in the hundreds of dollars, but for most the annual premium will be in the $4,000-$6,000 range per year. For this premium, the surety company will work on freight brokerage’s behalf to mitigate any claims. The alternative – a $75,000 trust fund – involves putting the entire amount in a fund up front.
While there is no education required in California, freight broker training is highly recommended, as training programs will help gain an understanding of the industry and to find assistance with job placement.
Also, while certification in California is not required either, and California does not have its own certification program, freight brokers may voluntarily take the Certified Transportation Brokers exam, which is overseen by the Transportation Intermediaries Association, to gain a competitive edge and have formal proof of their knowledge and abilities.
The Certified Transportation Broker (CTB) Program gives graduates the highest broker certification that currently existing in the industry and is the most widely recognized qualification among 3PLs. Fees for the exam are $375 for TIA members or $525 for non-members.
Freight agents are not required to have a license or certification, or hold a bond or insurances, but they will also benefit from training.
Freight Broker Training: What will I learn?
As transportation law is the same in California as for other states, there is no specific California training.
The best freight broker training schools will include the following components in their training programs, ensuring that graduates are prepared to become successful professionals:
Freight brokers need to understand the regulatory environment in which they work. The need to understand transportation and contract law, case law regarding back solicitation and double payment, damage claim issues and insurance law and employment law and workers’ compensation.
- Business administration
Brokers must understand the general business principles involved in running a freight brokerage, including record-keeping, accounting and finance. They should be comfortable using software and documentation that is common to the business, as well as online tools such as load boards.
- The freight brokering business
Freight brokers need to know how to negotiate freight brokerage contracts and how to price shipping and their own services. They also need to have a sound knowledge of best practice for national and international traffic management, shipments, claims and fleet.
- Sales and marketing
Freight brokerage is a highly competitive business. As such, the successful freight broker/agent should take a training class in sales and marketing techniques including telephone and email skills, direct marketing and advertising.
Freight Broker Schools in California
Brooke Training Solutions in partnership with Ed2go and over 2,000 colleges across the U.S offer an excellent online, instructor-led freight broker training course. This program has 180 course hours and is usually completed in six months. It is available at colleges such as Los Angeles Valley College, Sonoma State University, Betham College in San Jose, Cal State East Bay or San Diego State University. To find a program near at a college near you, enter your zip code in the box below and request information without obligation.
This freight broker/agent program will teach you how to set up your own home-based freight brokerage and how to differentiate the types of freight and niche markets, and give a you full understanding of transportation law and broker-carrier/broker-shipper contracts, recordkeeping, accounting and financial management, and sales and marketing techniques to promote your business.
There are also several short online programs and 5-day intensive programs available nationwide, including the presential freight broker training class offered by Load Training, who have been offering freight broker training since 1987, and Brooke Transportation Training Solutions, which offers training with a strong curriculum various times per year in Ontario, California. These programs cost between $2,000 and $6,000.
The Transportation Intermediaries Association offers a complete CTB study program and exam package that costs $1,050 for TIA members and $1,325 for non-members. Students can also purchase the freight broker course separately ($675 for members and $800 for non-members).
How much does a freight broker make in California?
According to the United States Bureau of Labor Statistics, California cargo and a freight agent earn from entry-level salaries of $28,000 for those with little experience or training, to $65,380, with average being $45,830. This however is only one part of the story.
Freight brokers/agents also earn commissions for each load and this will significantly increase their overall compensation.
Logistics account executives in the transportation industry can earn as much as $125,000.
For this with the ambition to run their own freight brokerage operation, no fear of hard work and the willingness to accept the inherent risks, the rewards can be significantly higher. Those with little experience can expect to earn around $50,000 in their early years. Once they have built up a portfolio of clients – shippers and manufacturers – and run their own database of trucking companies and owner operators that can serve those clients, freight brokers may make up to $500,000 a year.
Where to work as a freight broker/agent
Of the biggest national freight brokers, the Allen Lund Company is based in Los Angeles, CA and has over 500 employees nationwide. All the other national and international brokers have representation in California.
As you might expect, the biggest concentration of job offers are found in the most populous areas and the seaports around Los Angeles, San Francisco, San Diego and Tijuana, and these are great places to start in becoming a freight broker.
California Organizations you should know
Freight brokers in California have their representation through various organizations that represent the common business interests of customs Brokers and freight forwarders as professionals in dealing with government, carriers, industry and one another. These include the Los Angeles Customs Brokers and Freight Forwarders Association, which focuses on Southern California business, and the Customs Brokers and Forwarders Association of Northern California. Becoming a member of these organizations will be useful for networking opportunities for your freight brokerage, presents a good image to clients and will keep you up to date with commercial and regulatory changes that affect the industry.
The trucking industry is represented by the California Trucking Association, which based in Sacramento.