Everything is Logistics

The Freight Agent Questions That Costs People the Most

Blythe (Brumleve) Milligan

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0:00 | 27:31

Choosing the right freight agency can make or break your business. So when a post on Linkedin went semi-viral about the top freight agent programs in the country, your girl had to share what she's learned from years of interviewing freight agents and the execs that run these programs. 


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SPEAKER_01

The agent that comes on board has their existing book of business. They have their customers. They have their relationships. It's their accounts. I don't make them sign a non-compete where I have control of the accounts. If they decide to leave, they can take their accounts with them. That direct quote was brought to you by Mike Micklick, CRO over at SPI Logistics. And on a previous episode, it really explains right there that that's the difference between a freight agent program that says it supports entrepreneurs and one that actually has to earn the relationship every single day. Because if someone can leave, they can still choose to stay. And if they stay, that tells you a lot. Welcome into another episode of Everything is Logistics, a podcast for the Thinkers in Freight. I'm your host, Blythe Milligan, and today we're talking about how SPI Logistics is different from other freight agency programs. And yes, SPI is a longtime sponsor of this show. Listeners, you have heard previous episodes. You already know that, but they've supported me in a way that allows me to tell some of my favorite stories in logistics. But for this episode, it's not me reading a polished ad from a Google Doc or hearing from nine people who have never moved freight before, including myself, even though I've worked in a freight office uh for a long time before I started doing what you see now. This episode is based on conversations that I've actually had over the years with SBI, their executive team, their leadership team, and of course their agents, of which they've graciously allowed to come on the show and tell their stories. And that is what I want to center this episode around today is pulling some of those quotes from those conversations to help potential freight agents out there make that decision on if they want to become a freight agent, if they want to build towards becoming a freight agent, or if they're an existing freight agent and they're thinking that the grass might be greener at another company. So if you're interested in hearing more, stay tuned. Now, as a little bit of a background, there was a post that kind of made the rounds on LinkedIn recently, and I'm going to bring it up on the screen right now. And it basically was talking about the top freight agent programs, I should say, that are in the country. Basically, if you Google freight agent companies or freight agent programs, hopefully, you know, everything is logistics or digital dispatch, is one of those sites that pop up. We do very well for that keyword ranking. But there's a lot of agencies and programs that will populate throughout that list. Now, this post by Colby Baskin, who is the founder and CEO over at Caltown Logistics, he had this post that had about 96 comments related to freight agent programs within this space. So it has about 117 uh interactions on the post itself, and it has 96 total comments when uh one of uh those comments being your girl right here. Because I saw this list and I knew I immediately had to chime in because I've started seeing more and more folks become aware of what it is to be a freight agent because there's there's freight agent, there's freight broker, there's freight forwarder, and you can sometimes those phrases get mixed up, especially within you know a US-based or North American-based brokerage, where there isn't a whole heck of a lot of difference between a freight broker and a freight agent without some key aspects. And so the biggest difference is that for a freight agent, you are working independently. You are you have your own customers. You typically will partner with another company as a contractor, 1099, you're not necessarily a W-2. If you're a W-2 broker, you're probably working in-house at a brokerage. That those are the biggest differences between uh being a freight agent and being a freight broker. Now, with having access to, I guess, uh more information, it it leads to a lot of different brokerages around the country saying, Well, I kind of want a you know, a freight agent program because I mean, if you're a brokerage, it's if you're offering up, you know, the technology, the the insurance, the, you know, a lot of the costs that are involved with running your own brokerage, which only increase every single year. The benefit of bringing on agents is that you're bringing them on, you're not having to pay them a salary, you're not having to pay, you know, for insurance costs or just typical onboarding cost when it comes to onboarding a broker. What you're paying for is essentially access to their customers. And so that's where a lot of brokerages are starting to recruit, not starting to. This has kind of been a thing for a little while, but I've started seeing more social media posts about it, more awareness around becoming a freight agent. I've even seen like other agencies or other programs, brokerages, they're starting to advertise a lot more. I have a sneaky suspicion that it has a little bit to do with what SPI has been doing with my show and also with Chris Jolly, of course, who is now a freight agent for SPI. And so you're starting to see more companies realize the benefits of recruiting agents to their company, but there are some very key differences that play a role for freight agents that they should be considering, especially if you're an established freight agent. Now, if you're not an established freight agent yet, SPI, I'm just gonna let you know right now, SPI focuses on established freight agents that already have a book of business, that already have customers. They will train and they will help out unique cases for people who want to get started and start their own freight agency, but it's a case-by-case basis. So I would reach out to Mike and the team over at SPI in order to figure out if you qualify for that. But for the most part, they are interested in established freight agents that come to their company so that they can help them grow. Now, with a lot of these different companies that you see on the list. So I know uh Armstrong Transport Group, I've actually had, you know, some of their uh previous executives on the show before I had the SBI relationship. And then you have, you know, a couple of other companies that I have heard about that it recruit independent freight agents. But I don't believe any of them on this list completely focus on agents. And what I mean by that is because I had to kind of let my voice be known. Because if you go through this post, Colby makes a great breakdown. This is a great image. So I do have to give him credit for this. And just for the folks who are listening, I'm just gonna read the part of the post really quick. Starts off by saying most people who Google freight agent programs find the same companies over and over. There's nothing wrong with that. Many of those companies have built outstanding businesses and invest heavily in marketing and recruiting, but there are a lot of exceptional agent programs that don't spend millions trying to be the first result on Google. This list isn't ranked, it isn't biggest to smallest, it isn't best to worst. It's simply eight freight agent programs that have earned strong reputations for supporting their agents. I've had the opportunity to connect with leaders behind many of these companies, and he goes on to name a bunch of different companies. A lot of them are very much like on this list. SPI was missing, so I figured I would add my opinion on SPI in the comments by saying, can't say enough good things about SPI. And though I'm not an agent myself, y'all should probably know that I can't speak directly to being a freight agent, but I have interviewed dozens of freight agents. I used to work for a brokerage team that did have in-house, not in-house agents. Some of them were in-house, some of them came to the office and you know, took up a desk, but most of them would all work from home or they worked in remote offices that they furnished that they paid for. But that the key difference is that we were an in-house brokerage who also had freight agents. Where SPI is different, is that they have only agents. They don't have any in-house brokers. And so, what often can happen, especially if you're a freight agent, and this is one of the points that I listed in my comment, a very lengthy comment. I'm surprised that you know, they uh in LinkedIn didn't, I don't want to say ban me, but didn't, you know, rate limit me as far as like how long the comment was. But for a lot of freight agent programs that also have freight agent, or not a lot of freight brokerages that also have freight agent programs, what will happen, and sometimes horror stories will happen. I'm not saying anybody on this list is doing these things. I want to make that perfectly clear. But for what happens naturally is that your customers get exposed, your your carriers that you have probably worked with for a long time get exposed. The company gets access to your sales records, to your what you're moving, who you're moving it for. And sometimes that can create an opportunity for that customer to get to know other folks within the brokerage that is not the agent. And so you could possibly have some situations where your customers are being exposed to essentially your competition. And so, as a freight agent, the major benefit of what you get with working with SPI is they have no in-house brokers, they have no dedicated freight internally that they have to move before they move their agents' freights. And so, keeping that in mind, you want to go somewhere where the freight agents are the only focus of the company instead of having an in-house brokerage that also has in-house agents. Now, I'm sure there's some pros and cons to each of those, but a major pro of working with SPI is that you have direct access to the team. They are working directly for you. The executive team only exists to help you and your customers. They're not out here trying to move freight, they're not out here trying to broker freight. Now, the next thing I wanted to bring up is the lane and agent saturation. Now, the lane and agent saturation is something that is not typically talked about enough, especially from the lens of, you know, what area of the country are you based in? What area of the where are your customers at? Where are your lanes at? Is there a high level of saturation for those lanes already within the program that you're moving to, or maybe the one that you're currently at right now? That's something you want to keep in mind too, because the last thing you want to do is on board with a new agency, on board all of your customers with a new program. And already that is a situation where your customer typically is trusting you to be the one to make the best decision for their freight. And so if they trust you to move their freight, then they likely will trust you that you if you make a program switch to somebody like an SBI, then you are making a calculated decision that this is in the best interest of that agent, of their the customer, their freight. But that it is a little bit of a lift to change companies. These things always, you know, anybody who says they don't take a little bit of time is probably lying to you. But with that said, SBI makes it as streamlined and as easy as possible because they have hundreds of agents all across the country, all across North America. And so, but going back to the saturation part, they're very, very conscious about where they take agents and what area of the country that they're taking them because they don't want agents competing over the same lane. They don't want their agents competing with the same customers, um, with the same carriers. They don't want to have that oversaturation that some freight agent companies, frankly, just don't really care about because they just want the agent, they just want their customers' freight and they just want it in the door and let the agent figure it out from there. So that's something you want to keep in mind is the lane agent saturation. That's a question that even if you don't go to SPI, that's something that you want to make sure that you ask that question ahead of time. The next one that I want to talk about is the ability to customize your tech stack. Now, the way that SPI does it is they have what's called, and the best way I can explain this is kind of like a data object. Now, you for larger customers, enterprise level customers, you probably already know what a data object is. It's basically think of it like a little globe in a solar system where all of the company's information goes to that globe. And then from there, they make different data connections that could connect to, you know, maybe a highway or carrier assure or search carriers, they're all of not just you know carrier compliance, but all of the different tech stacks that exist, including TMSs and things like that. Now, I do know that SBI uses Revanova as their you know in-house TMS. So if you needed a TMS, then you can use Revanova. But if you already have a TMS that you have, you know, loved using, then you can bring that TMS with you and you can customize it into SBI's system, not necessarily you, but their tech team. I have a couple episodes with um that with their CTO, Eze, that I can link to in the show notes. In fact, I'll just link to all of the interviews in case you want to listen and follow up after this episode to hear from the executive team and hear the specifics of what they talk about because we get into the data connections and and what happened. Do I have to, you know, as a freight agent, do I have to flip over my entire tech stack, you know, over to a new system? No, you don't. You can bring your own tech, you can use SPI's tech, or you can do a blend of the two. Maybe you you would like using a different TMS and you want to make the switch. That's on you. It's completely your decision. But that's how they kind of think about it as a data object where all of the company's data lives and then from and all of their integrations live. And so then that way they can plug and play into different, they can take your tech stack, they can take um SPIs, they can make a combination, they can have a greater variety of options to give you to best suit your needs. And so that's something to keep in mind as well, is that you do you want to have the mental bandwidth? It's not just onboarding at a new company, but do you really want to onboard at a new company and then onboard with new software and then onboard with all these new tech systems and then onboard all of your customers to all of those things too? Probably not. As I'm saying this, it sounds like a nightmare. But if you have that ease of onboarding, of being able to bring your own tech or use their tech or have a combination of the two, then that is certainly an option using the IT infrastructure that SPI has very thoughtfully calculated out. They've been doing this since for more than 40 years now. I had the CEO uh Mitch Helton on the show, and he was talking about how they were just his business partner was the one that was moving the freight. He was in charge of a lot of the different systems, and he talked about how a lot of the just administrative tasks just took up so much time and energy. And so they started developing these systems in the early 90s of being able to adapt quickly and and move quickly. And that's the philosophy that they've taken with them into the modern era. They're not using technology from the 90s, but that's how long they've been catering to freight agents, is for that long, since the early 90s, because they knew of the systems that they were struggling with. And so they developed a lot of those systems and continuously improve on them throughout the years. So that is another one. Next on the list is higher splits, commission splits. That's usually the 1A question that freight agents are asking whenever they choose to go to a new home. Uh, from what I have seen, especially working with other companies and hearing about what their splits look like, you know, uh for a first-time freight agent, if you don't have any customers, you're typically gonna look at like a 50-50, especially if that if you're gonna have to be trained on how to be a freight agent and work under a probably a brokerage that's going to kind of, you know, take a take a risk, take a bet on you. And so if you're a newer freight agent and you don't have any customers, that's what you're you're probably gonna see a 50-50 or a 60-40 split as far as commissions are concerned. 60 being in in your favor of what you're gonna get paid. Now, if you are more established, if you have you know better customers uh, you know, over a longer period of time, you obviously have more negotiating powers. And so keeping that in mind, you'll probably get a 70-30 split, sometimes an 80-20 split. It really just depends on your book of business and the longevity of those customers and how long you've been doing it. So higher commission splits is another reason why people move to SPI because like I said earlier, SPI is not necessarily a case-by-case basis, but they're going after the experienced freight agents who are not going to conflict with the agents that they already have within their system. They don't want to, you know, mess up a relationship with an agent that they already have. And so it's very much like a mutual beneficial partnership. And for a lot of the agents within SPI, they work together. Uh, I I've even known of some agents, and I have to get her on the show, but we've had uh Tynan uh Guthrie on the show before, and he talked about how he wanted to get started becoming a freight agent, and he worked underneath one of the agents within SPI's network. And when he got enough footing under him, he was able to spin off and start his own agency with the blessing of the other agent. And so that's just a good use case, a good example of what can happen when you are a unique case that you're willing to learn and you're willing to work under somebody else just for a little bit. So then that way you can start up your own agency in the future. Now, I've I've listed a bunch of examples here, and those are really the big ones that I wanted to hammer home. I would highly advise anybody who is thinking about becoming a freight agent that there is so much content out there right now. There's so much information that you can digest. If you are thinking about making a move, if you're thinking about making a switch, I have a landing page over on the Everything is Logistics website with about a half a dozen, at least six to eight interviews with the executive team from SPI, and then a whole bunch of interviews with their agents themselves. And so you can hear, I always make sure to ask the questions of like, what were you Googling before you you chose to leave? What was the, I guess, sort of the straw that broke the camel's back for you that you knew you wanted to leave the existing relationship that you're in and move over to SBI? And all of those agents answer those questions. And then we have, you know, like a Steve Burroughs who has been with SPI for years. He has a huge agency that he has built up with you using uh with him and his family all working for them. It's a great story. It's one of my favorite interviews I've ever done. Um, but head on over to Everything is Logistics, check out the drop-down that lists SPI, and you can hear all of those interviews. You can listen to them on demand, and you can hear it straight from the horse's mouth on what the experience is like working for SPI. Then I would go and I would check out some other interviews. Uh, I would check out some other companies, see if they're this upfront about how they work with agents as SPI is. You know, I mentioned this in the comment on the post that I have showed earlier, in that SPI has never told me what to ask their agents, what not to say. They've never, you know, put a muzzle on one of their agents and told them they can't talk about anything. And so just keep that in mind that these are free-flowing conversations that center around, you know, what it's like being an agent, what it's like becoming one, growing challenges and things like that, and how they overcame them, how they kind of excel in their entrepreneurial journey. I would listen to those episodes first. And then if SBI still sounds like a good idea to you, then you can go and listen to the leadership team and you can hear straight from them on what they think about their company philosophy and how they purposely built up this company in order to be an attractive model for freight agents to seek them out. And so that's just kind of my my a little bit of my sales pitch uh for everybody who is thinking about becoming an agent or is already an existing agent and is thinking about making the switch, making the jump. There are lots of questions that you might still have that could be answered in any of that content. Again, I'll link to it in the show notes just to make it easy for folks. But if you have any additional questions, make sure that you hit up the SPI website, which I'll also put in the show notes as well, of course. But tell them that you heard about this opportunity through Blythe and that you know you heard this conversation and it inspired you, hopefully, it inspired you to give them a buzz and see what they're all about because they really are the real deal. This is a company that has supported this show that has allowed me the bandwidth to be creative in this space. And so if they support a friggin' podcast like this, imagine how they support. Their agents and what they do and what their goals are. And I I just think the freight agent model, if this was me like 10-15 years ago, becoming a freight agent is probably what I would have done at when I worked in-house at an asset-based brokerage. It just seems so appealing to be able to be your own boss. I use air quotes there because I don't know if like be your own boss, this is a tangent, but I don't know if be your own boss is really truly a thing. Because you always have someone to answer to. And then having those relationships with your carrier base too. That's another thing that I forgot to mention within um all of this discussion is that SPI has the highest regard for all of their carriers. And so they only work with really good carriers. So if you have your own sort of talent pool of carriers that you work with, well, guess what? You're gonna have access to a heck of a lot more if you partner with a company like SPI. So this post just kind of you know gave me some you know inspiration that I wanted to kind of get on here and explain things a little bit clearly, if that makes sense. But, anyways, there's more information in the show notes. Head on over to everything is logistics if you want to hear more of those conversations. And then if you are an existing freight agent or an aspiring one, be sure to reach out to SBI in order to just start the conversation. That's no obligation. You just start the conversation and you see where things go. So hopefully this was informative to you as usual. Thank you so much for watching. Thank you so much for tuning in, and uh, we will see you real soon.

SPEAKER_00

Thanks for tuning in to another episode of Everything Is Logistics where we talk all things supply chain for the thinkers in freight. If you like this episode, there's plenty more where that came from. Be sure to follow or subscribe on your favorite podcast app so you never miss a conversation. The show is also available in video format over on YouTube just by searching Everything is Logistics. And if you're working in freight logistics or supply chain marketing, check out my company Digital Dispatch. We help you build smarter websites and marketing systems that actually drive results, not just vanity metrics. Additionally, if you're trying to find the right freight tech tools or partners without getting buried in buzzwords, head on over to cargo rex.io where we're building the largest database of logistics services and solutions. All the links you need are in the show notes. I'll catch you in the next episode and go jags.

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