“Freight agent” and “freight broker” are two terms often used interchangeably in the freight industry. But the terms have different connotations, and the roles look very different in the day-to-day work. While all of our independent freight agents at Tallgrass can also define themselves with the term “broker,” we prefer to emphasize that they are freight agents. Discover why — and how this freight agent mentality adds value to customers and agents alike!
Freight Broker vs. Freight Agent: A Matter of Mentality
If these job titles both describe a person who connects shippers with carriers to transport freight, what separates the two? “Responsibilities of a freight broker and a freight agent can be similar,” says Tallgrass President Sean Richardson. “But we look at the mentality as what makes them the most different.”
The Mentality of a Freight Broker
At Tallgrass, we define a freight broker as a freight agent without the business owner mentality. A freight broker might look at an issue with invoicing or losing a customer from their book of business as someone else’s problem. The freight broker may be less invested in the success of their book, regardless of whether they are working independently or working for a W-2 operation.
“The freight broker might have the mentality that they are building a book of business for somebody else,” says Sean. “The broker is giving so much up to the big box brokerage instead of keeping what’s theirs.” Without being personally invested in building a strong book of business, a freight broker won’t have the drive to reach their full potential.
The Mentality of a Freight Agent
A freight agent is a broker who is operating independently to build their own business and brand. They aren’t selling on behalf of a big box freight brokerage company; they’re selling for themselves with the support of a freight company. “What they’ve done instead of going out on their own and creating their own freight brokerage is they’ve made the business decision to partner with a company like Tallgrass,” explains Sean.
When you choose the path of a freight agent, you are your own business owner, but with the technology, resources, invoicing capabilities and more of a larger brokerage at your back.
How Freight Brokers vs. Freight Agents Earn Money
Because in most cases the freight broker is someone working a W-2 career and the freight agent is running their own independent freight agency, the compensation distinction is a significant factor.
How the W-2 Freight Broker Earns Money
A W-2 freight broker typically earns a living through two streams: a base salary and a commission based on loads moved in a given month. The commission for freight brokers is usually very low, ranging anywhere from 2% when first starting out, to 20% at the peak of one’s career. This limits how much money can be made as a freight broker, especially because it’s in the big box company’s best interest to give freight to new brokers with a lower commission rate.
“I’ve seen it in the W-2 world where eventually a broker can make too much money to where they’re not as profitable to the big brokerage as they were when they weren’t producing as much,” says Sean. When this takes place, a freight broker may lose accounts to brokers with lower commissions so the larger corporation can keep more revenue.
How the Independent Freight Agent Earns Money
When you work for yourself as an independent freight agent, the sky is the limit on how much money you can make! Your earning potential is completely up to you: how hard you’re willing to work, and how driven you are to learn and grow and thrive.
Freight agents have a much higher level of responsibility and ownership over their business than freight brokers, which is why at Tallgrass Freight we give our agents such an incredibly high split. “They’re assuming some significant risk,” acknowledges Sean. “But they’re putting in the effort and making those calls day in and day out. And so they deserve to be compensated as such.”
Agent vs. Broker: Which Approach is Right for You?
At first glance, becoming a freight agent may seem like the obvious choice. A chance to earn more money? What’s not to like!? While we at Tallgrass Freight are big fans of the independent freight agent approach, it isn’t for everyone. Ask yourself these questions to determine which path is right for you:
Am I willing to bet on myself?
When you become an independent freight agent, you are leaving behind the security of a consistent base salary every two weeks. While the compensation potential is high, and you may see yourself earning double that salary within months of starting your freight brokerage, you have to be willing to take that first step and bet on yourself.
Am I committed to the time and resources needed to grow my own book of business?
A successful business isn’t built overnight. You need to bring both hustle and patience to the equation. You will grow a thriving book of business when you bring ambition, effort and strategy! But patience is important, as it takes time to secure the right clients.
Meanwhile, your Tallgrass team will be present to help and support you every single day. From our speedy onboarding to our ongoing professional development, we’ll do all we can to expedite your success and keep you growing.
Am I prepared to go all in, no matter what?
Every day won’t be full of big wins. As Sean puts it, “You’re going to have days where you feel like you’re God’s gift to everybody with freight, and then you’re going to have days where you have the negative self-talk creep in.” If you can intentionally shift your mindset and look for the small wins in the midst of self-doubt, you’re going to have much more drive to push through and get back to those big victories.
Do I have the work ethic of a business owner?
Being an independent freight agent is all about personal discipline. You need to possess the work ethic to take on long hours, make calls on weekends and establish a work-life balance that fits your lifestyle while keeping your business thriving. Much of the foundation of a good work ethic is accountability.
As an independent freight agent, the success of your business is 100% on you. Sean sees this as a good thing! “You should want it to be all on you,” he says. “You should want it to be up to you that you succeed and you’re the one that took your business to the next level.” This is the mindset that separates the freight agents from the freight brokers.
How Tallgrass Supports Freight Agents
While you are responsible for your own success as an independent freight agent with Tallgrass, that doesn’t mean you’re on your own! We like to say that we’re as hands-on or hands-off as you need us to be. For the new freight agent building a foundation, we are ready to share experience and coaching to get you off on the right foot. When a freight agent joins Tallgrass with a thriving book and many years of experience, we’re here to answer any questions but are also eager to learn from them and cheer them on!
To support our independent freight agents, Tallgrass is always here when you need us most. When you call us, we’ll answer. When you email, we’ll respond within 15 minutes and then call to make sure we adequately answer your question. Because when it comes to our agents, we’re just as dedicated to success as you are!
Ready to go all-in on your freight career? Talk to us about how you can become a freight agent with Tallgrass.