The Trucking Agent, or Agency; also called Carrier Agent, is the contracting party to manage an operation as an agent for the Trucking company, or Carrier. These people typically operate independent of the Main Carrier, and are owned by the Agent, and given permission to contract with their trucks and customer base.
These Agents or Agencies, are typically, the backbone of the trucking fleet, operating as an independent except for the billing, insurance, and are typically paid weekly based on contracted percentage of the gross freight bill.
Drivers typically contract with the agent, but operate under the Carrier operation. Carrier pays driver, while Agent earns the profits of differences, between the Owner Operators, or Fleet owners, To the Agent, and the Agency agreement with Carrier, the difference is their profit.
The Agent or Agency is responsible for their operation, trucks, and freight. The carrier pays the drivers based on agreement, and pays the agent weekly with the drivers. Agent handles the paperwork, recruitment, office costs, and fees.
Billing is done typically by agent, on the Carrier Invoice, for each load completed by driver. Although the Carrier mandates the Agent is responsible for the fuel, permits, ect. Agents pass costs through to the driver. They Earn differences on anything billable. Permits may be $50 but they charge $125 to the Truck. Some have their own trailers, others do not. Some handle specific freight, while others may have 3-4 dispatchers managing their fleet ops from the Agency location. I have seen agencies, lease trailers.
The surprising thing to many is the Dispatching Operations, are also Truck Agents, and are given authorization to act on the behalf of the carrier. Booking freight and being paid a set percentage of the gross of the load.
Any repairs are bypassed through agent to the Owner operators, or truck owners. All are independent, but act, and operate on behalf and for the Carrier Main Corp Office in exchange of set percentage rates
80%-85% Agency Gross
65-80% Truck Contract minus fees, operation costs, requirements
Some agents may be contracted at a percentage rate, but pay a flat fee per mileage rate to the driver.
Exclusive Rights- Many Carriers that use the Agent/Agency for fleet growth, can and may require exclusive rights to the Agent. Some have exclusivity, others do not. Most of the trucking owner operations that work under the Carrier name, typically require Exclusivity to the truck. While Agents are most times not held to the clause. Per Rules of Operation, anytime a owner operator, driver, fleet owner may contract with another company, they must disclose to the carrier so the carriers can operate and cover the safety issues.
Broker Agents are a completely different sector to the operation. They handle brokering whereas the trucking or Carrier Agent is the trucking operation of transportation via direct in house route of delivery.
One of the common practices found amongst this crowd, is
a) All the agents, typically worked for another carrier agent, dispatched for the operation during a period of time, once they have become liked and the customers know them well enough to guarantee continued operations without the Agent, the the dispatcher, will contract with an outside carrier to recruit the fleet, stealing the Agents fleet, and customer base overnight. Carriers do not care, they actively recruit for new agents, and do not block bad business, due to the adding of volume and 10 trucks instantly, turning large volume, can be as high as $10k per week per truck. Most owner ops can gross average $3-5k per week average before expenses
b) Drivers typically return to the Agent Operation location after finishing the hours of service for the week.
c) Most are regional operations
d) These can have fleets as large as 300 trucks and 6 dispatchers, accounting, management, and sales. While the average fleet is in the 15-25 truck range.
e) Carrier is final approval, however Agent takes risk on clients and prevents carriers from losing on unpaid invoices. These operations typically float a 90 day invoicing period for payment terms with major clients. Carrier pays everyone, weekly is typical, loads prior is paid following week. Volume saves carrier costs, and the truck is responsible for all their expenses.
f) Trucking agencies, earn between 5% of gross- to as high as 15% of the fleet gross.
g) These can be operated via non typical means, such as a home office, out of a car, at a truck yard/facility, even via mobile means. Most common is the home office, and a rented yard.
These operations are common and highly useful way to build and grow a Carrier operation fast, using the Agents customers, and fleet typically built and recruited prior to contracting. Typical office with Agents have the Agent, 2-3 Dispatching, depending on the types of operations, and the different fleet types.
Fleet owners can be Agents, and own the trucks, while some choose the owner operator/fleet owners as they truck operations. Trucking agents do not typically get to use both the freight broker of the carrier, if they have both brokerage, and motor carrier authorities. Agents must request both, or be approved for both.
Drivers are typically overlook for these roles, however, with a driver following a Driver that has built his network, can operate these secondary businesses out of the cab of the truck, if necessary, and have a solid group of drivers willing to come and bill under the agency.
The difference is that the Carrier, takes a set percentage of operations, and sets to side for these fleets, for growth, added fleet, added volume, and lower ops costs over the entire network. These carriers have and are always scouting for the discounts, on uses of fuel cards, factoring, strong customer base and financials, and operate on a 15%-20% average gross, and majority of the savings. They do apply and typically pass through fuel surcharges, fuel discounts due to volume and exclusivity. However, many are know for discounting and only passing through percentages of fuel surcharges to the driver, allowing extra profit margins.
Agents and Agencies are a value add to a Carrier Network, for the volume operations, Independents should consider the Agent Agency relationships as their back office, dispatching, Sales, and Business clientele, since most Independents are not typically taught, but are forced to learn after their Motor Carrier approval, and they are the business heads.