For a number of reasons, freight brokers have been enjoying increased revenue in the past year. The ongoing economic recovery is bringing an increase in demand for trucking services. And the good news is that this trend is expecting to continue for several more years. A report by the American Trucking Association (ATA) predicts that by 2022, overall revenue in the trucking industry will increase by 66 percent, while tonnage will see a 24 percent growth.
Another reason for increased revenue is increasing logistics efficiency. The increased use of less-than-truckload (LTL), a territory reserved for freight brokers, means speedier shipments for shippers and more profits for brokers.
Entry into Freight Brokering
When the freight broker bond amount was increased to $75,000 in 2013, one rationale for the increase was to raise standards for freight brokers and, in retrospect, the strategy seems to have been successful.
It’s true that a small percentage of brokers were forced out of business. However, the remaining brokers were people with good credit and reliability in the industry. This in turn raised overall trust in freight brokers, so entry into the profession has eased a bit. And the numbers are proving it– the number of brokers has been steadily increasing since 2013, and this year is no exception. MyCarrierResources.com reports that in January there were 15,023 registered brokers, whereas in October the number had jumped to 15,916.
Todd Bryant, president and founder of Bryant Surety Bonds, takes a look at the American trucking industry over the past year through the lens of a freight broker – read the rest of his insightful piece in the March issue of Supply Chain Digital.