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Freight & Logistics Insights

Freight brokers are federally regulated companies that help shippers find the best carrier for transporting goods. They do not physically handle freight. To obtain an operating license, brokers must purchase a surety bond or trust agreement. The bond requirement increased from $10,000 to $75,000 in 2013. Third party logistics providers may physically handle freight during manufacturing or warehousing. Courts have established that brokers can be held liable if they do not properly screen carriers and an accident occurs.

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189 views2 pages

Freight & Logistics Insights

Freight brokers are federally regulated companies that help shippers find the best carrier for transporting goods. They do not physically handle freight. To obtain an operating license, brokers must purchase a surety bond or trust agreement. The bond requirement increased from $10,000 to $75,000 in 2013. Third party logistics providers may physically handle freight during manufacturing or warehousing. Courts have established that brokers can be held liable if they do not properly screen carriers and an accident occurs.

Uploaded by

shobhraj
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© © All Rights Reserved
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  • Logistics brokers: Describes the role and characteristics of logistics brokers, including major players in the industry.
  • Freight companies: Explores various freight companies and their operations within the logistics industry.
  • Third Party Logistics Software: Discusses logistics software aimed at maximizing efficiency and tracking shipments.
  • Third party broker liability: Covers legal liabilities and protection measures related to third party brokers in logistics.

companies are usually spin-offs from freight forwarders.

There are various types of courier


companies, such as airfreight courier companies (FedEx, Skynet WorldWide
Express,Purolator, Purolator International, Crossflight) or road couriers (Circle Express).

Logistics brokers[edit]
Freight brokers are federally regulated and bonded companies. Most commonly they have a vast
network and access to a library of freight carriers and search for the right availability based on
customer specifications. These brokers also offer various value-added services that
encompass transportation, logistics, and distribution. Typically, freight brokers do not "fingerprint",
or touch, the freight. They engage in helping shippers find the best price with the best carrier for
any given load.
The proliferation of freight brokers called for an increase in financial integrity and liability of these
companies, which has led to the passing of the Moving Ahead for Progress in the 21st Century
Act (MAP-21).[2] In order to obtain a license to broker freight, a freight brokerage must purchase a
surety bond or trust agreement with the Federal Motor Carrier Safety Administration (FMCSA).
[3]

Prior to June 2012 when the bill was signed by President Obama, the surety bond coverage

required to hold a broker license was $10,000. Effective October 1, 2013, the surety bond
requirement increased to $75,000.[4]
Other logistics companies include 3rd-Party Logistics Providers. They offer a variety of supply
chain and distribution-related practices and techniques in order to improve in-house logistics.
The main difference between a traditional freight broker and most 3rd-Party Logistics Providers is
that freight brokers do not actually touch (fingerprint) the freight, whereas 3rd-Party Logistics
providers often do. This can happen, for example, when the 3rd-Party Logistics company
handles outsourced manufacturing and/or warehousing. Such companies include the likes
of Access America Transport, BAX Global, Murphy Warehouse Company, Schenker
Logistics, United Parcel Service Logistics Division.

Freight companies[edit]
Some of the most well-known and worldwide companies are United Parcel Service,Kuehne +
Nagel, DHL, Purolator, GlobalTranz, FedEx and TNT.

Third Party Logistics Software[edit]


Every freight company utilizes software to maximize efficiency and track shipments. Some of the
most well known and notable are Vixsoft Systems FreightFax 4, Aljex, Transcoreand TMW
Systems. Some freight companies specialize in certain parts of the market. For
example, Transcore is the USA's largest load matching system, TMW Systems tends to
specialize in asset based full truckload systems.Aljex is the largest SAAS vendor in the market. A
TMS or transportation management system stores carrier and customer data in order to
electronically rate and dispatch freight. If a freight company does not have its own negotiated

carrier rates, there are other types of technology and partnerships that can be used in lieu of a
transportation management system.

Third party broker liability[edit]


In Schramm, the Courts opened the door for freight brokers to be held legally liable in the case of
a trucking accident, involving a carrier whom they hired to carry freight, that resulted in injury to a
person. Many guidelines, most under the Federal Motor Carrier Safety Administration's SAFER
System,[5] are available to freight brokers to screen potential carrier safety and, if it is proven that
the broker did not utilize these government provided tools, liability can be transferred to or
shared with them in the result of an injury accident. Another regulation that protects carriers and
shippers is the freight broker bond - freight brokers must get bonded in order to operate legally. If
a carrier file a claim, the bond would cover it.

companies are usually spin-offs from freight forwarders. There are various types of courier companies, such as airfreight co
carrier rates, there are other types of technology and partnerships that can be used in lieu of a transportation management

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