Logistics play a crucial role in the global economy, ensuring countries and businesses have the commodities to meet consumer demand. Worldwide parcel shipments have increased almost fourfold in the past decade. By 2026, the number of global parcel shipments per year is expected to reach 266 billion. International shipping is becoming increasingly efficient and streamlined to ensure products arrive safe and on time.
Importing and exporting are complicated tasks. Shippers can experience costly delays and supply chain disruptions if they fail to execute a shipping strategy correctly. International transport involves extensive paperwork, taxes, duties, and negotiations. Language barriers and cultural differences between buyers and sellers often make the process more challenging.
What is a Freight Broker Agent?
A freight broker agent offers supply chain management services and is responsible for coordinating and overseeing shipments on behalf of businesses and shipping companies. The agent relies on knowledge, experience, and a professional network to help organizations overcome the challenges associated with international transportation.
Freight agents use their negotiation skills and contacts to secure affordable freight rates for their clients. They also help them to save valuable time and resources on the tedious and cumbersome tasks associated with imports and exports. A competent freight agent can be invaluable to a shipper, facilitating smooth operations and solving supply chain management issues.
Some companies hire cargo and freight agents to handle specific logistical tasks, like export documentation. However, most organizations employ agents to take responsibility for all aspects of an international deal. They must contact vendors, negotiate with suppliers, and oversee customer delivery.
Freight brokerages may also hire freight agents to be responsible for client acquisition. A freight agent’s role involves a combination of negotiating, planning, customer service, and administrative activities. Agents aren’t required to obtain a broker’s license from the Federal Motor Carrier Safety Administration (FMCSA), but it can be an advantage.
Key Responsibilities of a Freight Broker Agent
If you’re considering hiring a freight broker agent for your business, you might be wondering what they do. Before deciding on an agent, it’s essential to learn the key duties involved in the role.
1. Advise Clients on Specific Modes of Transport
One of the most critical decisions for any importer or exporter is choosing the correct method of shipment. An agent informs clients of their options and recommends the most suitable shipping methods for incoming or outgoing cargo. The primary transportation modes are ocean, air, road, and rail.
When advising clients on transportation methods, agents focus on four main factors:
- Reliability of transport method
- Product safety
- Physical characteristics of goods
2. Determine a Mode of Transport
Ocean transport is the most frequently used shipping method, accounting for approximately 90% of international freight. It is a reliable and safe option for high volumes of heavy-duty goods or raw materials.
However, compacted cargo and adverse weather can jeopardize the safety of your merchandise. Ocean freight is also relatively slow, taking between 30 and 40 days to travel between China and the United States.
Air transportation is highly reliable. Shipments by airline carriers are often ten times faster than by ocean carriers. Air freight is an ideal solution for small and lightweight goods. However, it is one of the most expensive methods of shipping.
Road and rail transport is cost-effective and reliable. There is an extensive network of rail and trucking terminals throughout North America, Europe, and Asia, for efficient travel.
Agents work with transportation intermediaries and freight companies daily, ensuring they can offer sound guidance on transportation methods. In many cases, intermodal transport is needed. This involves using a combination of international shipping options and direct delivery trucks.
3. Coordinate Freight Shipments and Routes
Once you determine a transportation method, cargo and freight agents must coordinate shipments and routes. They work with shipping docks, freight forwarders, logistics companies, and suppliers to plan efficient travel routes.
This step can save clients a lot of time. Since agents are familiar with transportation routes and shipping merchandise, they can provide a range of options quickly.
4. Estimate Shipping Costs
The cost of shipping fluctuates year-round due to demand, availability of cargo containers, fuel costs, postal rates, and shipping charges. Agents must estimate freight costs, including surcharges, taxes, and duties.
One of the key benefits of working with reliable agents is taking advantage of their vast network. Due to the number of goods they distribute, they can often secure discounted rates from a freight forwarder. They may also liaise with more than one transportation company, helping you get your goods in transit as quickly as possible.
Depending on your chosen mode of transport, price-determining factors vary. However, the main factors that influence price quotes include:
- Freight weights
- Shipping origin and destination
- Cargo load volume
- Whether or not you choose expedited international shipping
- Insurance coverage
There are also several additional costs to consider. For example, you may need to hire cargo loading or material-moving equipment when your goods arrive. You might also need to arrange freight pickup at the destination port.
These facilities must be accounted for if your goods require cold or temporary storage. Agents can provide estimates for the entire process, ensuring you know the total costs before making a decision.
5. Negotiate for Clients
Cargo and freight agents negotiate on behalf of their clients for a range of shipping activities. They liaise with external parties, including suppliers, shipping companies, ocean transportation intermediaries, air transport carriers, and road and rail services, to arrange international shipments. Agents rely on their industry knowledge and contacts to secure good deals at affordable prices.
6. Update Clients on Shipments
Clients expect high standards of service from cargo and freight agents. Once the inventory is in transit, agents notify customers regarding route movement and cargo arrival.
Many freight companies use software programs that allow clients to track delivery progress. Customers can log in and check the estimated time for the arrival of freight or its current status. This data can also be used for freight consignment, providing customers with accurate route info, precise freight speed, and on-point delivery times.
If customers have specific delivery requests, agents must ensure they are fulfilled. They may have to contact service depots or arrange personal services to keep clients updated.
7. Prepare Shipping Documents
Most major businesses have administrative personnel on the payroll to handle basic deliveries, pay taxes, manage stock, prepare reports, and maintain company records. However, custom forms and shipping documentation can be very complex.
Submitting an incorrect form or failing to follow shipping instructions properly can result in significant problems, like shipping delays, inflated rates, fines, and even product seizures. Cargo and freight agents are trained to master legal codes and government regulations and correctly process international shipping documents. Some of the key documents an agent takes care of include:
- Shipper’s letter of instruction (SLI)
- Bill of lading (BOL)
- Commercial invoice
- Packing list
- Certificate of origin
- Insurance forms
- Product identification codes
They may also confirm that the address labels and barcodes are correct and functional. While it may be tempting to try and handle the paperwork in-house, this can be a grave error for many businesses.
8. Record Keeping
Record keeping is critical in the shipping industry. It helps keep track of shipments and verifies payment agreements, shipping schedules, and other key shipping details. The FMCSA mandates that brokers maintain and file accurate records for a minimum of three years. This includes information such as:
- Freight weight and distribution of weight
- Container volume (completeness of load containers)
- Shipping times
- Delivery times
- Transfer times like delivery to loading platform before products are shipped
- Activities of workers engaged with individual shipments
Many freight broker agents also file an evaluation of customer satisfaction for internal use. This can help with training design and management principles for future projects. As a supply specialist, this is an important duty and helps ensure correct order fulfillment in the long term.
9. Solve Problems with Shipments
As a logistics coordinator, a freight agent must ensure cargo for delivery arrives safely and on time. However, occasional issues are inevitable. Claims may be filed against the carrier if inventory incurs damage during shipment.
Legal actions concerning lost or damaged inventory can be taken by the shipper or the freight agent on behalf of the client. However, to mitigate the risk of lost or broken goods, most freight agents recommend insurance coverage for specific items for damage prevention.
Shippers should have a supply of packing materials to add padding to loads, protecting them against contamination or damage during transit. Having appropriate equipment is essential for smooth cargo operations.
Improve Shipping Efficiency With Professional Freight Brokerage
Asiana USA is a world-class customs brokerage, handling road, rail, ocean, and air transportation for local and international businesses. We manage every step of the importing and exporting process, ensuring all aspects of supply chain management are in order.
We offer advice on documentation for international shipments and can fulfill all your legal obligations, facilitating fast and efficient transportation. Avoid costly international shipping mistakes with the help of Asiana USA. For more information on our services, contact us at (855) 500-1808.