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Baby boomers are retiring and millennials aren’t rushing into the freight industry. Many likely don’t even know what a freight agent is and are not very keen on becoming truck drivers. Yet right now is the best time to become a freight agent and here are the reasons why.
#1: Demand for Freight is High
In an internet based economy, freight services go hand-in-hand. There are literally millions of small, mid-size, and large businesses that operate largely online. From selling clothes and paintings to selling cell phones and other gadgets, all of those businesses depend on freight.
Just Amazon alone makes up a huge chunk of the business with their free two day shipping for Amazon Prime members. And by the way in 2013 it was reported that they had 10 million Amazon Prime subscribers who paid between about $40 and $100 for that service.
As online businesses continue to be a large part of the U.S. economy so will the demand for freight agents to ensure their deliveries. Since 2009 those numbers have been steadily growing, doubling from 2012 to 2013.
#2: There is a Driver Shortage
Meanwhile, the pool of drivers available to make those deliveries is shrinking as the baby boom generation retires. According to Logistics Management there is a shortage of 20K drivers which could rise to over 100K over the next few years.
This is the perfect time for someone looking to change careers to consider one as a freight agent. With fewer drivers out there, the opportunities are available for agents and drivers to enter into the freight industry.
Those numbers could change over the next few years. With the virtual explosion of online retailers and secondary businesses that rely on freight to operate and the rise of competitive independent trucking businesses, waiting a few years may prove costly.
#3: Continued Economic Growth
Economic growth in the manufacturing industry is a good indicator of the health of the freight services industry. Because manufacturers rely heavily on freight not just to deliver their goods but to inbound the materials needed to make those goods, there is a strong correlation between the two; when manufacturing is good, demand for freight is high.
Here are some statistics that bear that out:
- Since 2009 manufacturing revenues have grown by more than 25% from just over $1.7 trillion to nearly $2.1 trillion.
- The manufacturing industry employs 12 million workers and affiliated industries account for over 17 million jobs.
- Manufacturing accounts for 75% of U.S. research and development.
- GDP growth is expected to continue to go up by 3% by the end of the year.
Competition in this sector is currently low but is expected to change soon. That makes now the best time to become a freight agent. Add in the fact that new technologies are leveling the playing field for small and mid-sized freight companies, the possibilities for building a solid career as a freight agent are very good.
#4: Technology is Making it Cheaper and Easier
The cost of doing business for the freight industry is overall cheaper today thanks to technology. Granted regulations have added some costs to the overall operations but those costs pay off in the long run in savings. And the fuel costs required to meet demand are high.
Yet technology is enabling freight agents to coordinate shipments using multiple down chain suppliers resulting in faster more efficient operations. It is one of the reasons why Amazon is able to offer free two day shipping to its customers. The job of a freight agent is to coordinate those vendors and suppliers to help the business operate smoothly.
Becoming a Freight Agent
The cost to becoming a freight agent is relatively low. Registration costs vary according to state but licensing costs just $300. As long you have internet access, a computer, and a phone, you can even work from home as an agent. In addition to those costs, you will need:
- Surety Bond
- Supply Chain Management Software
- And Marketing Costs
All in all you will spend approximately $4,500 to $7K to get started as a freight agent. Working with an established brokerage could offset some of those costs. Even as a side income particularly for retirees and former truck drivers, this can amount to a very rewarding career.
It is worth considering especially if you are interested in a career change. The freight industry is on the upswing and the outlook for the future looks bright. Here you can find information about the agent program offered by GlobalTranz.