Do you want to start Freight Broker business plan?
Do you want to learn how to start a freight broker company? If so, you’re in the right place. This business plan for freight broker will teach everything from how to start a freight brokerage to all the management operations needed. The best thing about freight broker business is that you don’t need a ton of experience to get started. All you need are some street smarts and a good business plan.
In this document, we will be explaining how to develop a good business plan that can guide your company. You can also follow the business plan of a related business like business plan for real estate or an import/export business plan for more examples. Here, we will provide the business plan of Carry On, a Freight Brokerage Startup operating in Newark, New Jersey.
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2.1 The Business
Carry On will be a freight broker startup started by Harry Doofenshmirtz. The startup will aim to provide freight brokerage services to various producers and distributors around Newark, New Jersey. The business will ensure that the shipment from shippers is adequately handled and delivered by the Cargo company.
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2.2 Management of Freight Broker Company
To make sure that every aspect of the freight broker startup is managed properly, efficient planning needs to be done. And what better way to learn how to start your own freight brokerage business than through a business plan. A business plan will answer your question about “what do you need to start a freight brokerage”?
Since this is a business plan for a startup, it will also tell you how to become a freight broker from home. You can use this as a guide to make business plans for investment. That way, you can put a planned-out persona in front of your investors.
Apart from this plan, you can also refer to a related business plan like a non-emergency medical transportation business plan as it has similar services to the business at hand.
2.3 Customers of Freight Broker Company
The customers of Carry On will belong to all industry domains including clothing, sports goods, and furniture, etc. However, our most prominent customers will include:
- Import/Export Business
2.4 Business Target
Our target is to become a reliable and trusted freight brokerage in town connecting suppliers to carriers when they most need it.
Our financial targets to meet for the five years of launch are demonstrated below:
3.1 Company Owner
Harry Doofenshmirtz will be the owner of Carry On. He attained a business diploma from a local college and then worked up his way in a distribution warehouse. However, he wanted to start his own business. So, after much thought, he left his post and started Carry On.
3.2 Why the Freight Broker company is being started
Through his job, Harry noticed that most of the good companies around him suffered because of a lack of good carriers. It seemed that even though there were carrier companies available, it was much too time consuming for a company to compare their merits. So, Harry decided to bridge this communication and time gap between the two domains by starting a freight broker business of his own.
3.3 How the Freight Broker company will be started
Step1: Plan Everything
One of the first steps when learning how to start a freight broker business is to plan out everything. Every aspect of the business should be planned in some detail beforehand to avoid any big surprises. For planning your business, you can use this freight broker business plan sample for Carry On. You can also use a Muskoka airport business plan for guidance as it has the same structure. In this freight broker business plan pdf, the entire start up of Carry On will be planned out.
Step2: Define the Brand
The next step after planning the operations is to advertise the business so that it attracts customers. At this time, you should develop a brand image for your company and highlight its human aspirations and values to attract more people.
Step3: Establish Your Corporate Office
To start of the business, Harry rented out an office space in the marketing sector of town. He will now work to hire employees and make contacts with shippers and carriers.
Step4: Establish a Web Presence
Internet presence is an important part of any business today to get more reach to customers.
For this purpose, Harry decided he will get a one-page website developed through which customers will be able to contact the business. He also decided to establish social media presence for his business.
Step5: Promote and Market
The last step is to develop a thorough marketing plan for your company and then stick to it for advertising your business.
|Research and Development||$10,000|
|TOTAL START-UP EXPENSES||$249,280|
|Other Current Assets||$278,000|
|Start-up Expenses to Fund||$249,280|
|Start-up Assets to Fund||$1,031,600|
|TOTAL FUNDING REQUIRED||$1,280,880|
|Non-cash Assets from Start-up||$1,293,400|
|Cash Requirements from Start-up||$122,800|
|Additional Cash Raised||$50,000|
|Cash Balance on Starting Date||$35,000|
|Liabilities and Capital|
|Accounts Payable (Outstanding Bills)||$52,200|
|Other Current Liabilities (interest-free)||$0|
|Additional Investment Requirement||$0|
|TOTAL PLANNED INVESTMENT||$1,280,880|
|Loss at Start-up (Start-up Expenses)||$150,120|
|TOTAL CAPITAL AND LIABILITIES||$1,501,200|
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Before you start your freight broker business startup, you need to know some details. There are requirements to become a freight broker and one of these requirements happens to be deciding services. For getting a freight broker license, you will need to know several details of your business. That way you can plan everything effectively.
Here, we are providing the service details of freight brokerage business plan. You can also look at something similar like atravel agency business plan for guidance. In this free freight broker business plan, the services offered by Carry On will be:
One of the main jobs of Carry On as a freight brokerage will be to connect carriers with the supplier customers they need and vice versa.
- Carrier Evaluations
Carry Out will evaluate all the carriers available for the job required by the shipper to make sure that each shipper is matched with the best carrier. The company will cater to the location and type of goods to be transported by the shipper to make sure that only the best partnership is achieved between the two parties.
- Shipment Monitoring
One of the services of Carry On that make it so convenient is that the company will be responsible to track the shipment from the Shippers. And shippers can just relax and focus on other work. The company will track the cargo regularly to ensure that everything is safe.
Carry On will also ensure compliance of the carriers to the requirements by shippers. Some shipments include things that might be vulnerable to damage or need certain conditions for transport. Carry On will make sure that the carriers fulfill all the requirements.
- Price Negotiations
In addition to carrier evaluations, our company will also cater to the price range of its clients. Multiple options will be considered, and prices will be negotiated with both shipper and carrier parties to achieve at a middle ground that is good for both.
Marketing Analysis of Freight Broker Company
Before you start a freight brokerage business, you need to know your customers and competitors in-depth. In short, getting well versed about the target market is one of the steps to become a freight broker. For this purpose, you can conduct a marketing analysis as a part of your freight broker business plan. Your marketing analysis should analyze market trends with your financial goals to figure out pricing of your services. This analysis will help you learn how to be a successful freight broker.
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If you don’t know how to conduct a marketing analysis and you want to know “how can I become a freight broker?”, you can use this business plan. This document will tell you ways to start your own freight brokerage business pdf. It will outline all the components of a broker business model and help you do a target market analysis for your business.
Here, we are providing the marketing analysis for Carry On. You can use this template to learn how to become freight broker agent.
5.1 Market Trends
According to VerifiredMarketResearch, Freight Brokerage industry is valued at around $1.164 Billion in the US. The industry is expected to grow at a rate of 36% and reach around $14 Billion by 2028. There is an increase in the need for convenience in intermediate operations that is driving the growth of the industry. And it is expected to do so in the coming years as well making any investment in the industry an excellent choice.
5.2 Marketing Segmentation
The potential customers of Carry On are divided into the following groups:
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Carriers will be cargo companies that will be responsible for the delivery of goods. Our company will also be providing them business by acting as an intermediate party. So, these will be our most consistent and reliable customers. And they will primarily utilize our connection services.
Our secondary customers will be the producer companies that produce raw materials or products and need them to be taken to their clients. They are expected to utilize our services most often.
Our third target customers will be Distributors who buy materials and products in bulk and then send them to various warehouses and shops for selling. There are quite a considerable number of distributor companies around Newark in need of freight brokers, so we expect to receive these customers regularly.
This will be our fourth target group of customers. There are a few manufacturing industries set up around Newark. Therefore, we expect to receive business from them quite often.
5.2.5 Import/Export Business
Lastly, we will cater to the import/export businesses in and around town. The trend of selling imported goods has increased, especially in the fashion industry. So, we expect a fair amount of business from the local import/export businesses.
|Potential Customers||Growth||Year 1||Year 2||Year 3||Year 4||Year 5||CAGR|
|Import/ Export Businesses||23%||21,100||25,320||30,384||36,461||43,753||11.00%|
5.3 Business Target
- To become the best freight brokerage business in New Jersey.
- To expand the business to include not just Newark but entire New Jersey.
- To earn a profit margin of $50k/month by the end of two years.
- To maintain cordial relationships between the shippers and carriers.
5.4 Product Pricing
Our prices will be a little higher than if the shippers were to hire carriers on their own. But for this price, we will offer our clients a stress-free management of their goods and delivery operations.
To make sure that you are recognizable amongst your competition, you will need to come up with several competitive aspects for your freight brokerage start up. For this, you need to focus on developing a marketing strategy. This can include anything from advertisements to freight broker business cards.
For a good marketing of your business, you will need to analyze many things such as freight broker software cost and costs of different ways of advertisement.
In this freight brokerage business plan pdf, we are detailing the marketing strategies of Carry On. However, you can take help from marketing strategies of other businesses as well. For instance, from a subscription box business plan.
6.1 Competitive Analysis
- We have a lot of ways of communicating with clients including direct meetings, social media, and website so our clients have more ease.
- We will offer stress-free delivery operations for our clients.
- We will implement good discussion practices so that all the client’s requirements are met.
6.2 Sales Strategy
- We will advertise our business through local ads, social media, and Google Ads.
- We will offer discounts to our first 20 clients.
- We will also offer great packages for our long term and regular clients.
6.3 Sales Monthly
6.4 Sales Yearly
6.5 Sales Forecast
|Unit Sales||Year 1||Year 2||Year 3|
|Compliance & Negotiations||200||212||225|
|TOTAL UNIT SALES||925||981||1,039|
|Unit Prices||Year 1||Year 2||Year 3|
|Compliance & Negotiations||$800.00||$928.00||$1,076.48|
|Compliance & Negotiations||$160,000.00||$196,736.00||$241,906.59|
|Direct Unit Costs||Year 1||Year 2||Year 3|
|Compliance & Negotiations||$250.00||$275.00||$288.75|
|Direct Cost of Sales|
|Compliance & Negotiations||$50,000.00||$58,300.00||$64,887.90|
|Subtotal Direct Cost of Sales||$232,500.00||$271,095.00||$301,728.74|
The business of a freight broker franchise depends a lot on its customer service and relations. Therefore, Harry put together a list of all the employees that will be necessary for the success of business. Additionally, he also included specific criteria in the freight broker business plan to hire workers.
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7.1 Company Staff
- 1 Co-Manager to help in overall operations
- 3 Supply Chain Executives
- 2 Broker Assistants
- 1 Web Developer to develop and maintain webpage
- 1 Sales Executives to organize and promote sales
- 1 Accountant
- 2 Drivers
- 1 Receptionist
7.2 Average Salary of Employees
|Year 1||Year 2||Year 3|
|Supply Chain Executives||$75,000||$82,500||$90,750|
To ensure the success of your business, you need to control freight broker startup costs. It is essential to manage everything efficiently so that your business doesn’t go into a loss. A good financial plan will keep your company from becoming a freight brokerage business for sale.
In your financial plan, you need to detail all the costs necessary to run your business as well as the ways you will earn revenue. In this business plan, we are detailing the financial plan of Carry On. But you can take help from other business plans as well such as hot shot trucking service business plan.
8.1 Important Assumptions
|Year 1||Year 2||Year 3|
|Current Interest Rate||8.12%||8.20%||8.26%|
|Long-term Interest Rate||8.40%||8.44%||8.47%|
8.2 Break-even Analysis
|Monthly Units Break-even||5340|
|Monthly Revenue Break-even||$132,500|
|Average Per-Unit Revenue||$231.00|
|Average Per-Unit Variable Cost||$0.62|
|Estimated Monthly Fixed Cost||$163,800|
8.3 Projected Profit and Loss
|Pro Forma Profit And Loss|
|Year 1||Year 2||Year 3|
|Direct Cost of Sales||$232,500||$271,095||$301,729|
|TOTAL COST OF SALES||$232,500||$271,095||$301,729|
|Gross Margin %||73.77%||75.12%||77.48%|
|Sales and Marketing and Other Expenses||$145,000||$148,000||$156,000|
|Total Operating Expenses||$482,700||$517,300||$561,135|
|Profit Before Interest and Taxes||$171,050||$301,338||$477,072|
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8.3.1 Profit Monthly
8.3.2 Profit Yearly
8.3.3 Gross Margin Monthly
8.3.4 Gross Margin Yearly
8.4 Projected Cash Flow
|Pro Forma Cash Flow|
|Cash Received||Year 1||Year 2||Year 3|
|Cash from Operations|
|Cash from Receivables||$22,000||$23,760||$25,661|
|SUBTOTAL CASH FROM OPERATIONS||$73,000||$79,570||$85,936|
|Additional Cash Received|
|Sales Tax, VAT, HST/GST Received||$0||$0||$0|
|New Current Borrowing||$0||$0||$0|
|New Other Liabilities (interest-free)||$0||$0||$0|
|New Long-term Liabilities||$0||$0||$0|
|Sales of Other Current Assets||$0||$0||$0|
|Sales of Long-term Assets||$0||$0||$0|
|New Investment Received||$0||$0||$0|
|SUBTOTAL CASH RECEIVED||$74,000||$79,000||$85,000|
|Expenditures||Year 1||Year 2||Year 3|
|Expenditures from Operations|
|SUBTOTAL SPENT ON OPERATIONS||$69,000||$70,000||$76,000|
|Additional Cash Spent|
|Sales Tax, VAT, HST/GST Paid Out||$0||$0||$0|
|Principal Repayment of Current Borrowing||$0||$0||$0|
|Other Liabilities Principal Repayment||$0||$0||$0|
|Long-term Liabilities Principal Repayment||$0||$0||$0|
|Purchase Other Current Assets||$0||$0||$0|
|Purchase Long-term Assets||$0||$0||$0|
|SUBTOTAL CASH SPENT||$69,000||$74,520||$80,482|
|Net Cash Flow||$21,000||$23,000||$25,000|
8.5 Projected Balance Sheet
|Pro Forma Balance Sheet|
|Assets||Year 1||Year 2||Year 3|
|Other Current Assets||$1,000||$1,000||$1,000|
|TOTAL CURRENT ASSETS||$282,000||$315,840||$355,004|
|TOTAL LONG-TERM ASSETS||$24,400||$27,328||$30,744|
|Liabilities and Capital||Year 4||Year 5||Year 6|
|Other Current Liabilities||$0||$0||$0|
|SUBTOTAL CURRENT LIABILITIES||$19,000||$21,280||$23,919|
|TOTAL LIABILITIES AND CAPITAL||$300,000||$329,280||$370,440|
8.6 Business Ratios
|Year 1||Year 2||Year 3||INDUSTRY PROFILE|
|Percent of Total Assets|
|Other Current Assets||2.11%||2.34%||2.59%||2.40%|
|Total Current Assets||149.80%||151.00%||152.00%||158.00%|
|Percent of Sales|
|Selling, General & Administrative Expenses||93.56%||96.09%||98.78%||97.80%|
|Profit Before Interest and Taxes||41.50%||42.62%||43.81%||33.90%|
|Total Debt to Total Assets||0.18%||0.18%||0.17%||0.40%|
|Pre-tax Return on Net Worth||74.08%||74.89%||75.00%||75.00%|
|Pre-tax Return on Assets||96.30%||101.12%||106.17%||111.30%|
|Additional Ratios||Year 1||Year 2||Year 3|
|Net Profit Margin||33.56%||34.60%||35.67%||N.A.|
|Return on Equity||55.80%||57.53%||59.31%||N.A.|
|Accounts Receivable Turnover||7.7||7.8||7.8||N.A.|
|Accounts Payable Turnover||15.6||16||16.3||N.A.|
|Total Asset Turnover||2.5||2.5||2.6||N.A.|
|Debt to Net Worth||-0.04||-0.03||-0.04||N.A.|
|Current Liab. to Liab.||1||1||1||N.A.|
|Net Working Capital||$244,000||$257,664||$272,093||N.A.|
|Assets to Sales||0.85||0.87||0.89||N.A.|
|Current Debt/Total Assets||1%||0%||0%||N.A.|
1. How do I write a freight brokerage business plan?
You can develop a business plan for your freight brokerage by following this freight broker business plan sample.
2. How much do freight brokerage owners make?
The income of a freight broker depends on a lot of things including freight broker startup costs, freight broker process, and prices of services.
3. Are freight brokerages profitable?
Starting a freight brokerage company can prove profitable if it is managed efficiently and smartly.
4. How much does a freight broker make a year?
If you are learning how to be a freight broker agent, you might be wondering how much they make in a year. Though the accurate number depends on the success of the business, on average, freight brokers make around $60,000 in a year.
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