10 Important Questions to Ask Freight Brokers
Top-notch freight brokers offer a wide variety of services to both shippers and carriers. From innovative technologies and increased resources to routing, scheduling, and long-term relationships, services offered by freight brokers are designed to streamline processes. Third party logistics (3PL) providers are vital in connecting supply with demand in the transportation sector.
But with 18,000 3PLs operating in a fragmented and rapidly changing logistics market, how does a shipper find the right logistics partner? Selecting the wrong freight broker can cost you time, money, and credibility.
Here are ten questions to ask before giving a 3PL your valuable business.
1. How long have you been in business?
This is more important than you might think. Longevity in logistics indicates a solid customer and carrier base, as well as, the ability to adapt to and adopt new technologies. You have to figure out what’s important to you in a logistics partner. A brokerage with less than a year under their belt and 100 new employees is a different operation from a brokerage that’s been around for decades with a team of 20-30 experienced professionals.
2. How do you source your carriers, and how does your on boarding work?
Watch out for 3PLs that aren’t talking about their core carrier base. We’ve been around for 30 years and have long-term relationships with an elite and deep base of small to midsize carriers. No, we’re not perfect with carrier on boarding. But our approach revolves around consistency. We’ll walk away from a new carrier that doesn’t feel right before putting them on your hot load.
Here’s another thing, lots of brokerages live and die by the load board. They will post your load and field inbound calls until they find a match. It’s a touch-and-go way to do business, and it’s a good way for your load to fall through the cracks.
We prefer to be proactive with our carriers, to know ahead of time which carrier is a good fit for your freight. Our system allows us to document that info and match your load with the best carrier. Because we’ve been in business so long, we have an excellent credit score and we pay carriers quickly. Our reputation is spotless, and that’s why carriers NEVER turn us down. Most 3PLs are not this fortunate. This is a great thing to review when evaluating a broker.
3. Once you find a good carrier, how do you keep them?
Good carriers are the lifeblood of this industry. Good carriers offer GPS tracking, are reliable and on-time at both pickup and delivery, and don’t drop loads at the last minute, Listen, we can talk about technology and customer service all day long, but in the long run without good carriers, a 3PL’s offerings are slim. That’s why this question is so important. The best way to hold onto good carriers is to offer the best freight, pay your bills on time, and pay detention (always), as well as, providing 24/7 availability–this means taking weekend and late night phone calls.
Communication is imperative. At AM Transport, we’re transparent with our carriers. We find that openness and honesty allows us to work through most situations. Trucking is a highly volatile business, in other words, stuff happens–it’s how you respond that separates you from the amateurs. And your business is too important to waste time with amateurs.
4. What is the average tenure of your team members?
Listen, there’s no way around it, a team of highly-trained and seasoned transportation experts is better than a group of newbies. Around here the average tenure is 8 years (but we have folks who’ve been with us for 25 years).
Why is this important? We believe strongly in cultivating lasting relationships. Our team members know our customers and carriers which makes finding solutions and solving problems easier in all aspects.
5. How is your customer retention?
Do you want to go through the hassle of finding a new logistics partner a year from now? Probably not. But if a brokerage’s average customer churn is 12 months, that’s what you’re looking at.
There’s no better indicator of innovation and commitment to good customer service, than happy long-term customers.
A good 3PL will tell you all about their long-term customers. For example, here at AM Transport, we’ve been working with some of our customers for 30 years. We simply don’t lose customers because we are good at what we do.
6. What is your DAT rating? How about Google? Is this important to you?
We have access to more information than any other time in history. Who doesn’t look at reviews before buying that new SUV or giving that new steak house a try! That’s why we suggest you check out the reviews before partnering with a new logistics firm. If a freight broker isn’t pointing you in the direction of their great reviews, something is up! Here at AM Transport, we’re proud of what our carriers and customers have to say about us. We encourage both to leave honest reviews on Google and DAT because we want you to read them. Ask around–this is definitely not the norm.
7. Do you have a good TMS?
Did you know that some brokers are using a Transportation Management System (TMS) built on old technology and unable to handle today’s advanced processes and integrate with other platforms?
In an industry where data flows are increasing at a rapid pace it’s nearly impossible to understand your logistics operation without a TMS. The days of collecting data over a long period, and then taking a few weeks to analyze it are over. If you want to have the most efficient supply chain (and of course you do), data analysis must occur in minutes rather than months.
The best TMS is a control center, able to communicate in real-time with all relevant systems in the operation. In this scenario, it provides the current condition of any shipment inbound to your operation or outbound to your end customer. In addition, it supplies the size, weight, cost, location, ETAs, temperature, or any other information necessary to you or your customer’s operation.
If a freight broker doesn’t want to talk about their TMS, walk away.
8. What are your tracking solutions? Do you track full truckload?
There are many tracking solutions out there and a good freight broker is always trying new products to achieve the highest adoption rate with carriers. And truckload tracking is a must. Here at AMT, we electronically track 100% of all loads, and we are constantly innovating new and better tracking solutions from pickup to delivery.
9. Do you belong to the Transportation Intermediaries Association (TIA)? Do you attend industry conferences or take advantage of professional learning opportunities?
Simply put, TIA members are the best of the best. If a broker isn’t a member of the TIA, you should ask why. (There are no good reasons.) The TIA provides brokers with excellent resources from education, information, and networking to advocacy and research.
We can’t stress enough how rapidly this industry is changing. That’s why continuing education and investment in professional development is imperative. You’ll want to know if your potential logistics partner stays on top of the trends.
10. What’s your philosophy–is the Customer more important than the Carrier?
Watch out for that broker who tells you the customer is more important or vice versa.
A broker can’t conduct their business without great customers and solid carriers. Great customers have good, consistent freight, treat their carriers well, and communicate well. Solid carriers are reliable, on-time at both pickup and delivery, and provide GPS tracking and regular communication.