Freight brokerage volumes appear healthy on the surface, but broker profitability is fragile due to high costs. A mid-market brokerage with $30 million in revenue and 15,700 loads annually faces losses of $19 per load. Even with high volume, brokers struggle to break even due to structural under-margin issues.

Many brokers operate at margins that don’t support costs, leading to constant pressure to stay afloat. Highly automated, digitally native brokerages can survive and grow by reducing costs per load significantly. The current freight cycle has exposed a mismatch between pricing expectations and cost reality, leading to consolidation and restructurings in the industry.

Brokers are struggling not due to a misunderstanding of freight, but because margins per load no longer cover costs. The math doesn’t work at prevailing margins, leading to quiet exits and painful restructurings. The key lesson is that margin per load determines success in brokerage, and for many, it’s currently insufficient.

Read more at Yahoo Finance: How are Freight Brokers Staying Afloat?