Freight brokerage wants to be added as a carrier

brucetannr

New Member
1
Hello Everyone,

First of all I would like to thank the creator and the admins of this website, this platform has been helpful a lot. Also, hope everyone is staying safe and healthy during this pandemic.

we are a small freight brokerage company running since past 2years with MC,DOT and have BMC84, Broker’s Insurance on file. To start with, we want to grow and get into the carrier side as well. I believe as the owner of the company I would need to apply CVOR for now. I want to add owner-operators to start with and not our own trucks for now.

Do we need to get carrier's insurance + brokers insurance? Also, do we need to provide plates to the driver?
Can anyone please suggest what documents shall I need to add owner-operators? Or where should I start the process from? I am finding it abit overwhelming.


Thank you so much, everyone!
 

johnnyn

Member
5
I am not sure but i think you need CVOR + the owner of the company needs to have an AZ license to pull this off.
 

chica123

Site Supporter
20
I hate to sound negative, but I agree with Lowmiler. I think most carriers begin with a driver or owner/operator that has worked for years in the industry branching out on their own. They have worked and have gained important knowledge over the years. Maybe they want the freedom to work on their own. Maybe they know someone that will give them business. Over the years some grow into bigger operations, while some stay small. But this is a very complex business to operate. If you have no clue what you are about to do, it has the potential to cost you BIG TIME. First you have to know trucks. You also have to have customers. Then you need to know about compliance and safety and the list goes on. If you don't know enough about the industry then you will either be taken advantage of due to your lack of knowledge, or you will inadvertently take advantage of someone else. It is a big decision to make.
 

Freight Broker

Well-Known Member
30
Don't do it unless you can clearly show that becoming a carrier will substantially improve revenues and profits to justify the added headaches and cost. Running a carrier is substantually more difficult than running a brokerage.. even if you're running owner-operators. And as a broker you're making 15% gross without the headache of being a carrier. Running owner-ops you're paying 85% of revenues to the truck.. so you're no further ahead but you've also got all the responsibilites of being a carrier.. and the cost. Hiring owner-operators and getting them up and running is expensive too.. and if your business is down they will leave you in a flash for greener pastures, and that's assuming you can hire them in the first place. It's a tough market.. experienced carriers who have been in this biz for decades are having trouble recruiting owner-operators. Unless you offer something others aren't.. it will be very difficult to recruit them to work for your fledgling operation.
 

TRKINSURE

Active Member
15
OP, message me about the insurance requirements if you have specific questions.

You’ll need prior experience as a driver if you want to pull this off. The insurers will expect you provide them with a letter of experience prior to quoting you.

The other posters are not wrong, now is not the time to be getting into the trucking market... but what do I know?
 

Whitie

New Member
2
Most insurance companies are now asking that any new businesses looking for insurance require that the Director or owner need 3 + years AZ driving experience.
 

Gord M

Active Member
15
Here's the secret to trucking.............you need parking (always buy your parking spaces) so as you grow you keep purchasing drop yards and a bigger terminal, 20 years later you have a company doing 35 million a year which isn't worth much but you own properties they have all increased in value and you can sell the company for 50 million. Without the land you go broke eventually.
 

Freight Broker

Well-Known Member
30
Right on Gord.. alot of savy (and perhaps lucky) fleet owners bought acres around the airport back in the 60s..imagine how much land values have gone up in that area over the last 50 years... You look at a company like M-O.. a large part of their value is in the real estate..
 

WALTERK

Active Member
10
I say go for it! Feel the pain.... After a while, you will understand why some carriers call some of the broker's rates pure thievery. But, if you do, you waive your right to say you had not been warned! Good luck!
 

loaders

Site Supporter
30
If your brokerage operation has the perfect balance of year round, good paying outbound and inbound freight, then sure, why not put your own truck or two to work servicIng those lanes. I am pretty sure most carriers who started as a brokerage began their trucking operations this way.
 
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