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Freight Brokerage Business Plan

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As the marketplace continues to globalize, freight brokerages are experiencing more and more demand. An efficient freight brokerage provides third party logistics services by providing a link between various types of shippers and their customers. The shippers include ocean carriers, trucking companies, air freighters, rail transporters, and so on. The freight agents ensure a multitude of shippers can get their goods to end destinations, putting them high on the list of critical businesses needed to fuel economic growth.


Content of the freight brokerage business plan

The freight brokerage business plan is carefully crafted to either explain how a new freight brokerage business will bring efficiency to domestic or global shipping or the expansion plans for an existing business. Expansion efforts usually involve entering new markets. The freight brokerage business plan will address topics like the following:

  • The market niche the business will serve, such as specific shipping destinations, shipment of a particular type of item, and so on

  • The need for the shippers services, i.e. what market gap exists and how will its shipping brokerage services fill that gap

  • The type of customers served, such as manufacturers, foreign or domestic importers, buyers and sellers, etc.

  • Specific types of services offered

  • Customer demographics and marketing plans for attracting producers in the targeted market niche that was described in the Executive Summary and Company Description

  • Brokerage commission schedule

  • Location of the business and operational strategy to maintain state-of-the art technology

According to the TIA, a transportation industry association, most transportation intermediaries are non-asset based companies offering carrier- and mode-neutral services to the shippers who are asset owning. However, the freight brokerage firm must have high-end, sophisticated software and personnel with the expertise to utilize the full capacity of the software. The complex nature of a freight brokerage business means lenders and investors will spend considerable time evaluating the qualifications of the management team. Business owners must be knowledge of the shipping industry and logistics and the highly specific laws and regulations governing shipping. Freight brokerage firms need appropriate licensing, bonding and insurance, and legally enforceable business contracts. The type of licensing required depends on the transportation intermediary. Various agencies are involved, including the Federal Motor Carrier Safety Administration, the Federal Maritime Commission and the Transportation Security Administration.

There are a number of complex topics that need to be addressed in the freight brokerage business plan before potential investors will consider supporting startup or expansion. OGS Capital consultants have the experience and knowledge to help businesses prepare a successful business plan and find the right investors for success. The process begins by completing the simple, online contact form.
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