Most of the near to 40,000 truck dispatchers in the U.S. are making lucrative careers out to be organized, working independently and running their very own businesses. But dispatch services for truckers is not similar as truck brokering. Here's why.
The main difference is a truck broker generally is considered a bridge between carrier and shipper, whereas a truck dispatcher works mainly with the trucker to locate and dispatch loads – often for independent owner-operators.
“A broker's primary function is business development. They help truck drivers and transport companies find more loads to hold, while also helping shippers reduce their costs and negotiate the best possible rate,” in accordance with Truckstop.com, an on line load board and digital freight marketplace.
However, a truck dispatcher's primary function is execution, the business notes, because dispatchers are those who organize schedules and routes and dispatch drivers to fulfill shipments.
“Sometimes these roles and responsibilities overlap, but they're fundamentally different. A freight broker is similar to a baseball team's general manager, while a freight dispatcher is more such as a coach. Both play a significant role, but a dispatcher includes a more hands-on role on the front lines, while the broker is more back of house.”
The overlap of responsibilities, however, is area of the reason that truck dispatching has recently received attention from both regulators and lawmakers following allegations of illegal brokering from broker representatives.
This past year the Transportation Intermediaries Association filed a petition with the Federal Motor Carrier Safety Administration requesting that the agency issue a rulemaking aimed at raising standards for trucking dispatch services. TIA was also successful in stepping into the recent bipartisan infrastructure bill a provision requiring FMCSA to issue regulatory guidance on what truck brokers and dispatchers should operate.
Dispatchers generally concur with the intention of TIA's petition, that will be to get rid of bad actors from the market. However, they disagree with the method by which TIA proposes to perform that – by allowing dispatchers to be a realtor for starters motor carrier. “Anything further,” in accordance with TIA's request, “takes a brokerage license and compliance with the financial responsibility requirements applicable to brokers.”
But Brittany Hamstreet, a California-based dispatch services for truckers, said a truck dispatcher is “a bona fide agent” for one or more motor carriers.
“Dispatch services provide logistical coordination between brokers and motor carriers; complete necessary clerical tasks on behalf of motor carriers; maintain motor carriers'compliance with FMCSA regulations, taxes and fees; and assist motor carriers with attaining financial goals as determined by operating costs accrued by motor carriers,” Hamstreet told FreightWaves.