Carrier-Broker Comparisons

Item	Carriers	Brokers
Function:	Transport Goods	Arrange for transportation
Engagement:	Specific custom contracts	Specific custom contracts
Control:	Via Contract – driver	Via Contract – company
Size:	450 Billion Est.	142 Billion Est.
Authority:	F.H.A.	F.H.A.
Law :	U.S. Code	U.S. Code
Gen. Liability:	Primary	Contingent
Surety:	No	Yes
Cargo:	Primary	Contingent
Claim Processing:	Primary	Primary
Hold Harmless:	Yes	Yes
Strength of H.H.:	Balance sheet/insurance	Balance sheet/insurance

ESSENTIAL DIFFERENCES

Item	Carriers	Brokers
One Stop Shopping:	Biased to own equipment	Focused on task
Market Expertise:	Focus on own equipment	Must know daily dynamics
Overhead:	Heavily capitalized	Low overhead
Equipment Control:	Through own drivers	Through tight company contracts
Market Partnerships:	Uses competition	Partnering with many providers
Flexibility:	Finite	Unlimited
Double Jeopardy:	Protection via contract	Protection via contract

CONTRACT LANGUAGE THAT RESTRICTS

1. Contract asks for carrier authority.
2. To provide carrier services!
3. Equipment supply commitment as a carrier.
4. Performance standards of a carrier.
5. Carriers equipment and drivers.
6. Hazardous material provisions.
7. Freight loss or damage.
8. Insurance provisions.

Summary
It is estimated that currently 1/2 of all domestic trucking is moved through 3rd party firms. Just as there are good and bad carriers, so it is with brokers. Good brokers however will give their shipper customers the level of legal protection commensurate with risk return opportunities in the market place.