Am I being paid a “fair” commission split for the kind of business I’m doing? Below we outline the key factors brokers consider when setting splits, the typical industry ranges, and the red flags every agent should watch for. Read the examples and negotiation tips that follow to evaluate offers confidently.
What is a “fair” split?
A “fair” split is one that takes many things into consideration. Here are a few of them:
What Freight Tec takes into consideration:
- Trustworthiness of the Agent / Prospective Agent
- revenue level
- gross profit
- credit risk of your Shippers
- ease of doing business with your Shippers
- (the list goes on, and for simplicy’s sake – I’ll stop here)
I notice when prospective Agents call me to find out about Freight Tec’s Agency program – the first, and most popular question they ask is “… what is your commission split?” While a fair and reasonable commision split is important to have, it is not the most important thing to have.
If a company offered you a radically high commission split, would you take it?
Would it raise any red flags to you?
What are some potential risks for you?
Here is a list of some critical issues You need to know before signing on with ANY Broker:
- Trustworthiness of the Broker
- Financial stability
- Back office support
- Hours of operation
- Reputation in the industry
- Policies and Procedures of the Broker
Companies in the industry offer commission splits that range from 25% – 70% being paid to the Agent. The Industry average being paid out is 50% – 60% to the Agent.
More to come on each of those topics listed above… If you have questions or comments – please email them to: [email protected]
Thank you
Related reading: Earning Potential for Independent Freight Agents