The job market for brokers has long seemed to be one of consistent growth. Companies are always looking to hire brokers, according to Garrett Hughes, director of agent recruitment at First Star Logistics. “I don’t know if that’s changed at all. I still see plenty of jobs out there for freight brokers,” Hughes said.
Despite this, the current freight recession could pose a serious challenge for brokers entering the field today. With freight markets slowing, it has become harder to get customers. But Hughes said it is simultaneously a great time to prospect for new customers since industry rates are significantly higher than what the market is dictating now.
“People got locked into these super-high rates … when the market was booming, and then within a few months, that totally dropped off,” Hughes said. “So it’s a great time to get into the market if you’re not a broker currently because you will be able to get on the phone and start prospecting and finding new customers even though the freight has slowed down.”
For experienced freight broker agents looking to make a switch, now is the perfect time as well, according to Adam Mersch, director of business operations at First Star Logistics.
“I think during that time when the freight was so high, brokers were hitting all-time records, so they didn’t want to make a [company] switch even though they were experiencing various pain points at their current company — financially it just didn’t make sense yet,” he said. “Now that things are slowing down, I think a lot more freight brokers are looking to make a switch just because the issues that they were having before are more prominent.”
Founded in 2011 as a third-party logistics company, First Star Logistics is an experienced global logistics shipping provider that specializes in arranging and securing space for customers’ shipments across the U.S. and internationally through trucks, railroads and ocean liners. A few years in, First Star started its in-house brokerage department, allowing the company to service the entire country.
With more than 60 years of combined experience, First Star is among the companies in the freight industry looking to grow, despite today’s tough market conditions. A few weeks ago, First Star announced its newest addition to its aggressive five-year growth plan, specifically for experienced freight broker agents. The company calls it a “90 for 90” promotion — 90% commission for 90 days.
“We want to show them what we are about — show them the service, show them what we provide. We understand that we’re only going to make 10% during that time, but we trust in our process and our product and that they will stick around longer than that,” Mersch said. “We can use that first 90 days to really show what First Star has to offer and how [agents] can grow their business with First Star’s support behind it.”
The 90 for 90 promotion is currently being extended through January 2023. To qualify for the promotion, agents should have a current book of business (customers ready to move freight) or at least one year of experience and looking to rebuild.
Hughes added that the company is looking for agents with an entrepreneurial mindset. “We want you to create a book of business that’s going to be with you for a long time and be financially rewarding for both you and for the company,” he said.
Once agents sign on and complete their first 90 days, depending on what business they bring to the company, they move to a scale model — usually 60% to 70%. This is something that is discussed during the interview process and negotiated prior to the agent coming on board, according to Mersch.
Both Mersch and Hughes understand the hesitation behind moving from a W-2 job to a 1099. But they argue that the benefits of working for a company like First Star far outweigh the unknown.
First Star prides itself on its agent and employee models, both of which are slated to grow exponentially over the next three to five years. At First Star, agents and employees are more than just a number, they are a valued partner, Mersch added.
First Star aims to compete with other companies in the industry to give brokers a better overall employee experience.
“[Agents] couldn’t get ahold of somebody when they needed insurance pushed through on a carrier or approved for a carrier. They needed a check in the middle of the night and they had no one to answer their calls,” Mersch said. “We provide 24/7, 365-days-a-year support to our agents. And we not only have an entire department dedicated to that, but brokers also have my personal number, Garrett’s number and the other manager’s number, so if anything ever happens, anytime of the day, they can get ahold of somebody.”
The company also touts its lack of fees. Many companies require agents to pay for their own board, leads, systems and the like, Hughes said. “With us, there are no fees — there are no strings attached. You sign the contract with the percentage, then you make that percentage,” he added.
Overall, even though business is down for a lot of companies across the industry, Hughes stressed that First Star will not be taking its foot off the accelerator in regard to marketing and growth. “We have a plan in place. We aren’t just throwing things against the wall, we are being strategic,” he said.
Based in Cincinnati, the company just recently bought a new building that will bring approximately 250 brokers to the office as a part of the aggressive growth plan for the employee side of the business. For the agent side, Hughes added that there is endless room to grow as most agents are working remotely.
“We are really going forward full speed ahead to grow this business in the next five years. And we’re really looking to partner with the right people both on the employee side and on the agent side,” Mersch said. “At the end of the day, the 90 for 90 promotion is a trial. Agents can come and try us out for 90 days. At the end of 90 days, if it’s not for you, you have the option to go somewhere else.”
“But from what we’ve seen from our team, when people get a taste of what First Star offers, both to the customers and the employees/agents themselves, they don’t want to leave,” Hughes added.
For more information, visit First Star’s website.