How to Prepare for Fluctuations in a Freight Brokerage Business

Steady income you can rely on. What freight brokerage business doesn’t want that? Heck, every business, no matter how big, wants predictable revenue. But as you know all too well, there are fluctuations that can hit a freight brokerage business if your portfolio of clients is not well balanced. Here are some things to think about to add stability to your 3PL operation.


Sniff out the type of fluctuation your clients may experience during the sales process.

Ever had a costume store customer? I bet your July – September were busy. But what about February? As a freight brokerage business, it’s on you to know that the client you’re taking on has seasonality to their business. If you’re just getting your freight brokerage business started, you certainly should turn down freight you can cover profitably, but if you take it on, don’t start spending money like you’re Jordan Belfort in The Wolf of Wall Street. Be conservative with your cash; you’re probably going to need some down the road.

Seasonal fluctuations can be easy to spot, but what about economic, cyclical or irregular fluctuations to the customers of your freight brokerage business? Those can be less predictable and much less predictable. If you’re not following general economic trends, you should start. Because as the economy goes, so goes freight. For example, when there’s income growth, this usually signals higher consumer spending. This generally leads to an increase in business spending. Is unemployment on the rise? This could foreshadow a dip in consumer spending, which means lower business revenues and profits.

Cyclical fluctuations are alternating periods of contraction and expansion that can last 18 months or longer. During contraction, consumer and business demand falls. During expansion, demand goes back up. In periods of contraction, businesses will look to cut costs by reducing staff, cutting back on operating expenses and delaying investment decisions. During expansion, consumer spending increases, which leads to higher demand for cars and other big-ticket items. In a time of expansion, your customers will be increasing production, which increases their need for trucks.

Have carrier sales inform their carriers that you’ll have freight in lanes they cover at a particular time.

This can be particularly important if you’re vying against other carriers for the seasonal customer’s freight. But, get at least a verbal from your carrier sales team and you can approach your customer with more confidence and let them know that you’ll have capacity to cover the influx of trucks they’ll need during their busy season. Now, we know trucks are generally reserved no more than 72 hours in advance, but by communicating this information ahead of time, you can stay top of mind with carriers and have a leg up on other brokers who wait to the 11th hour to call and expect their carriers to pull of miracles for them.

Think about how you can make life easier for your customer(s).

Your customer may be dealing with a seasonal downturn, but what if it’s bigger than that? What if the downturn is specific to their business? Are there any ways you can make life easier for them outside of the freight that you’re already moving? Your freight brokerage business is going to succeed or fail on relationships. You have to have good relationships with your carriers, but you have to have even better relationships with your customers who supply the freight. Talk to them and figure out what they’re struggling with. Even if it’s not related to supplying trucks and making pickups. The more ways you can add value in creative ways can take you really far in the freight brokerage business. It’s more than just providing GPS tracking for the exact location of the freight. Think people skills.


Be conservative with your cash.

The phrase “don’t spend it all in one place.” could probably be written above the door in your freight brokerage business. That way everyone could be reminded of this valuable piece of advice. If you’re going to have seasonal clients as a smaller(ish) freight brokerage business, you’re going to need to get better at squirreling away money so you have it if you hit a lull in customer activity. If you are trying to forecast revenue for all your clients for a year, a simple trick to stay in a conservative mindset is to simply divide the revenue by 12. This way, you start to look at revenue by what it means per month over a 12 month period.


Manage your freight remotely. Complete visibility to your transportation supply chain is as close as your phone, tablet or computer. Freightflow freight broker software is the most easy-to-use freight broker software available today. The best part? It’s completely free to try. Don’t wait. Get started today with your no obligation, 100% free trial.

5 Keys to Running a Profitable Freight Brokerage

Ever get the feeling that running a profitable freight brokerage is impossible? It definitely IS possible, it just takes discipline and a commitment to constant improvement.

Interested in running a profitable freight brokerage? Focus on the fundamentals of a great business plan.

In the first training camp after winning the NBA title for the first time nearly 40 years, Coach Steve Kerr opened training camp by putting his team through some of the most basic drills any coach at any level could put their team through. Why? Even if you’ve reached the pinnacle of your profession, you’re never too skilled to go back to the fundamentals.

The same can be said for running a profitable freight brokerage. Take time to examine the KPIs you’re using to run your business. Do this at least once a year, ideally once a quarter. What goals have you set? Are there any small overhead costs sucking the life out of your profit margins? Conduct a quarterly review of every cost that comes across the credit card. In the freight brokerage business, you’re just going to have to do it if you want to squeeze out every last bit of profit.

That means scrutinizing marketing spend, your balance sheet and cash on hand and of course, your margins on every load brokered. You should be able to easily tie your marketing efforts to a clear return on investment. Are you storing your cash on hand in a high-yield savings account? Are there any lanes you’re running that, despite technically making money, you’re actually losing money due to the time it takes to cover them? These are all important questions that warrant routine examination, even if they feel very very basic.

Make smartphones work for you, not against you.

You’re probably already paying for a smartphone. You may even be paying for your entire family’s smartphone usage. But are you taking full advantage of all that your smartphone can do for your freight brokerage business?

Calling your smartphone a smartphone is almost a disservice because let’s be honest; it’s really a small computer that makes phone calls. But, when your computer can fit into your pocket, this should free up time for you to leave the office. No, this doesn’t mean you can go straight to the golf course. Where you should go though, is to see your clients. Remember the 80/20 rule.

Odds are you started the relationship from an inside sales call. But, put a face to your name and voice. In this day and age, you should be able to manage your entire business using freight broker software that’s optimized to work on your smartphone, so provided you trust your team to do their jobs, staying glued to the load board in your office is a tactic of prior days. Remember, you don’t always need more clients. Sometimes you need to refocus on getting more freight from the clients you already have.

It’s a globally-connected world. Are you tapping into all the markets you can?

Are you limiting yourself by focusing too much on your own country? Considering adding operations in a foreign country may sound daunting. The language. The currency exchange. The regulations. There are plenty of reasons not to try. But when it comes to running a profitable freight brokerage, there are even more reasons to look to expand into foreign markets. For one, competition for customers may not be as fierce as it is in a developed market like the United States.

There may be instances where your expertise in a certain area of logistics handily beats out that of an incumbent carrier. The best way to find out? Devote some time each week to researching a go-to-market strategy in other markets. Or, work LinkedIn to make some connections with foreign transportation pros and just set up time to Skype and network. There’s an ocean of opportunity out there. It’s never been easier to monitor exactly where your freight is at all times, so don’t settle for what’s only moving in your own country.

Keep learning, keep searching for bull markets.

As Jim Cramer says, “there’s always a bull market somewhere”. The same can be said for the movement of freight. There can be a general consensus that the health of the freight industry goes along with the economy, but, finding an area of growth just takes a keen eye and a a commitment to evaluating the macro view of freight movement. If you felt like all your energy was being taken up by the day-to-day runnings of your business, you wouldn’t be the first freight broker to feel that way. But running a profitable freight brokerage business is going to mean committing to studying market trends and then taking action to expand into areas you identify as profitable. For example, are there any niche industry conferences where you could go to meet people and network? How about the California Association of Farmers? How the Canadian Association of Forrest Products?

Think outside the box when it comes to lead generation.

Is there a hot new conference for you to focus on? Can you use word-of-mouth-referrals with existing customers to drum up new business? Could some strategically-written blog posts get you noticed by a shipping office or decision maker? How can you add value, through information, for your clients, before you ever talk about shipping a single load of their freight? If you look at the greater landscape of freight brokerage companies, who really stands out? Can some blogging help you attract new shippers? Would some targeted Facebook advertising give you a way to generate leads in a really cost-efficient, manageable way? When it comes to running a profitable freight brokerage, at the very least, you should consider optimizing your website for search terms so you can attract shippers looking for freight brokers.


Manage your freight remotely. Complete visibility to your transportation supply chain is as close as your phone, tablet or computer. Freightflow freight broker software is the most easy-to-use freight broker software available today. The best part? It’s completely free to try. Don’t wait. Get started today with your no obligation, 100% free trial.