Freight brokers’ truckload profit margins are under growing pressure, which is helping trucking fleets gain some pricing power, industry officials said.
“We are seeing some gross margin compression, especially on the net revenue side,” said Evan Armstrong, president of Armstrong & Associates, which publishes reports on the third-party logistics sector. “Traditionally, gross margins are about 15%; now we are seeing them in the 12% range.”
Armstrong said brokers are looking to gain market share and build volumes to secure competitively priced carrier capacity.
“In the commoditized dry-van truckload brokerage market, increased competition from rapidly growing newer entrants…
This story appears in the Oct. 21 print edition of Transport Topics.