Freight Brokers Bashed, do Some Bashing in Return

Frieghtwaves recently published two commentary articles with opposing viewpoints regarding the economic effects of freight brokers on carriers, and shippers. The Demise of the Freight Brokerage is an asset-based carrier\’s piece claiming asset-light / 3PL brokers are dead, or need to partially die, because they\’re driving asset-based carriers out of business. Are Brokers Really Gouging Carriers? is a rebuttal, detailing some economics and accounting principles that debunk the claims in the first, and call out the selective interpretation of the 2 data points to make the arguments. Summing up the second:

1. Supply and demand dictates carriers would go elsewhere for freight if one/many brokers were injuring the free freight market.

2. Brokers must have been giving margin back to carriers in heady freight markets of \’17-\’18 for the argument to work.

3. Though brokers\’ (relatively fixed) margins naturally grow as a % of total $ revenue in a soft market, same as they shrink in a tough one, their per-transaction revenue was actually flat in the given example.

Back in my world, I helped a carrier in an awkward area fill their trailer completely with on-route freight, ie: gravy, and helped a shipper by not deadheading a truck 150 miles for a partial load at a higher rate, and saw it through to delivery. I made money.

Do you see anything wrong with that? What\’s your position on the commentaries?

#freight #freightbroker #3PL #truckingcompany #truckingindustry #shipping #transportationindustry #logistics