Interested in Brokering? Here's 3 Mistakes to Avoid
As the year comes to a close, its a fitting time we reflect on some of the most common mistakes that we make as independent freight brokerages, and more importantly, how to avoid them yourself.
Whether you're looking to expand your carrier business, or you're just interested in brokering for the sake of brokering, running a freight brokerage has never been as easy and profitable as it is today. There's so many different ways improve and invest in your booming business - technology, staffing, sales, marketing, etc. However, there's also a multitude of pitfalls that you can easily fall in without even realizing it. This week. we thought it's high time we take some time and reflect on some of the most common mistakes that we make as independent freight brokerages, and more importantly, how to avoid them yourself.
Exaggerating Your Services
One of the easiest mistakes to make as a freight broker, and any transportation business, is to misrepresent or exaggerate the scope of services you provide. The transportation industry is built on relationships, and the core of these relationships has to be a foundational of mutual trust between broker, carrier, and shipper. This means that it's critical that if you don't own and operate your own assets, you represent yourself as a broker, and not as a motor carrier. Even if you can win extra business with the fib, it can land you in serious trouble in the case of a lost cargo claim or any kind of service failure. As a former broker, the honest relationship you build with your clients in the core of the business, and you do not want to jeopardize this over a few won or lost deals.
When you began your freight brokerage, you were probably hungry, eager, and excited to provide a next level experience for your customers. As you grew and scale, this hunger probably subsided, especially as the process for doing so becomes harder and harder. It's absolute crucial that you do not get complacent with your own success and you maintain your competitive edge. As an industry with very low barrier to entry, your brand, relationships, and customer experience are your only differentiators. Thus, its important to maintain that initial customer focused mindset that got you to where you are today. This means communicating more with your customers (a checkup call or facetime every week goes a long way!), finding new ways to provide service to your accounts, and provide creative services that your competitors aren't. If you're looking for ideas, checkout the rest of the FreightPath Blog for some ideas on how your can transform and update your customer experience going into 2020.
Relying on Load Boards
Load boards are a great tool, especially if you're just starting as a broker with few prior relationships. However, these transactions are often just that - transactional. This means that there's very little in the way of a relationship between you and these carriers. And these relationships are the core of your business! It's absolutely critical that you maintain these relationships, the same way you'd maintain a relationship with your customers. You don't want to be the broker constantly scavenging for trucking capacity on load boards, and not being able to offer instant service to your customers. Of course, this isn't to say load boards are useless or shouldn't be used - they're a fantastic secondary option for adding additional capacity to that of your core network of carriers. Even better - start looking for ways to slowly turn that load board business into long term relationships. By growing these relationships, you differentiate yourself from the competition, lower your long term costs, and make life easier for yourself and your customers. It's a no brainer as you continue to scale your business