Tips on how to start a Freight Brokerage Company in California

Freight Brokerage Company in California: Freight brokers serve a vital role in the transportation chain as intermediaries between shippers and carriers based on the most appropriate service for the shipper. There are various opportunities to expand your freight brokerage business by targeting individual customers and companies that need to deliver their products across the country. If you have previous experience in the industry, your chances of success are promising.


1. Write a business plan. Research the basic details of formation of freight brokerage companies in your area through the office of your locality. Visit both the established companies and the smaller ones in California to acquire additional information on the requirements and process of establishing a freight brokerage in the state. The business plan comes in handy when you’re approaching potential financiers for your business.

2. Locate suitable premises for your business. Consider pertinent factors such as zoning, convenience for customers and signage regulations for your particular county before you make a decision. Check with relevant state organizations such as the California Sign Association for signage and the California governor’s office for zoning and planning requirements to ensure the location is suitable for the business operations of a freight brokerage company.

3. Find financing for your business. Consider both state-sponsored financial assistance programs with commercial loans before settling on the financing option that suits your business the most by visiting the county offices nearest to you. Research available financing alternatives from the state by attending state-sponsored events — for instance, the business financing convention organized by the governor’s office. Ensure you have adequate finances to enable you to pay for a surety bond required in the state of California for the company — you need this bond to secure your business license.

4. Identify your company name and verify its availability. By searching the records available at the county clerk’s office on established brokerage companies in California. Determine your business structure and register your company. Choose to incorporate your company to separate your personal assets and liabilities from the company’s. Register a domain for your business once you’ve chosen the name, as you’ll rely substantially on the Internet to grow your business.

5. Embark on the legal process. Apply for a USDOT number from the Department of Transportation, as well as broker authority issued by the Federal Motor Carrier Safety Administration at a cost of $300, as of the date of publication. Acquire the surety bond from the administration to guarantee payment for shipping companies for their cargo space — you need a minimum of $10,000 to pay for this, as of the date of publication. Enlist legal representation to fulfill and register with the Federal Motor Carrier Safety Administration after paying a fee of $50.

6. Establish networks of truck services that you’ll use for shipping. Choose suppliers who meet the industry requirements to ensure that you’ll receive quality services from them. Look out for insurance requirements, general condition of their vehicles and aptitude of their drivers.

7. Find clients by passing word about your company through family and friends. Pursue the contacts that you might have established in your previous job assignments. Target established businesses in California to use your brokerage company for their transportation needs. Identify your company’s strengths and capitalize on them when marketing. Offer competitive pricing and discounts to attract clients.

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