Everybody loves the sound of a perfect high-five! We even get a chuckle watching two people whiff on an ‘almost’ high-five. To honor the age-old tradition of high-fives in our new contactless society, I’m focusing on the theme of 5. In this article, I discuss things you may be wondering about freight brokerage agencies. Here are The Top 5 Why’s, Top 5 (yeah, not a typo)
Why #1 – Why would a Brokerage Choose to Have Agents
1. When partnering with an experienced agent who specializes in a commodity or mode outside of corporate’s expertise, the agent instantly expands the knowledge and ability of the brokerage as a whole. This opens new markets and gives more service options to existing clients.
2. Agents often have a niche in the market that can be hard to crack into or even find. Partnering with agents can create a bridge to those particular and hard-to-target clients, similar to a merger with the purpose of buying into an account.
3. A skilled broker (as most agents are) will help expand the quality carriers within the brokerage’s carrier network. An agent often has relationships with carriers who seldom use a load board. This is much easier than calling every carrier in a public database.
4. As a growth model, agents are less capital intensive to add than the mass recruiting and training models commonly found within the industry today. The brokerage has less return per load but also removes some expenses and risks.
5. An agent offers a high level of customer service. Many agencies are between 1and 20 workers and fit into that “mom and pop” style business. They deliver the same customer service we all expect of our favorite local shops.
Why #2 - Why Shippers and Carriers Benefit from Using an Agent
1. When someone has direct ownership in a transaction, they are more attentive. Agents give shippers an exceptional level of customer service because they are vested in each transaction.
2. Stability in relationships of all kinds is a great feeling. With an agent, the shipper has a consistent and narrow contact tree. Established agents will run their agencies for decades, where often a broker within a company will get promoted or change jobs in some manner.
3. Agents have more power to resolve an issue. Employees have precise guidelines for what they can and cannot do. As an agent, there is more leeway. For example, they can decide to take a loss on the shipper or carrier side of a transaction if the circumstances and relationship deem it so, mitigating many issues that arise from time to time.
4. Many agencies run smaller operations, so there are fewer breaks in communication. In larger companies, there can be a sales rep, a rating department, an operations lead, a truck broker, and a track and trace team involved. That can lead to a bad version of The Telephone Game. Agents will have the same person or two handles the sales, truck sourcing, rating, and dispatch, which helps reduce friction and errors in communication and provides a better outcome.
5. Agents are a local presence for shippers and carriers. They often have some local connection to their key accounts and carriers, creating a stronger bond. I find many agents are scattered across the country in both rural and metro areas. In contrast, many of the large brokerage houses are only in major cities.
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