What is a typical freight broker margin?

Brokerage gross margins commonly land in the low-to-mid teens as a percentage of the customer rate, with contract freight usually thinner and spot freight more variable in both directions. The percentage matters less than margin dollars per load against the time the load consumes: a 20% margin on a $900 load that takes four phone calls can be worth less than a 10% margin on a $3,000 load that books itself.

What is deadhead in trucking and what does it cost?

Deadhead is the empty miles a truck runs to reach a pickup. Its cost is deadhead miles multiplied by the operating cost per mile, and it comes straight out of the load's profit rather than being billed separately. At $1.80 per mile in operating cost, 150 deadhead miles costs $270 before the truck has hauled anything.

What is detention pay and when does it start?

Detention is what a carrier bills when a shipper or receiver holds the truck past the free time, conventionally two hours, at an hourly rate that is often capped per day. Four hours at a dock with two hours free and $75 per hour bills two hours, or $150. Detention is only collectible if arrival and departure times are documented, which is why in-and-out timestamps on the bill of lading matter more than the rate itself.

How do you find the break-even rate on a load?

Break-even rate = (loaded miles + deadhead miles) x operating cost per mile, plus any fixed costs allocated to the load. At $1.80 per mile all-in, a 1,200-mile load with 150 deadhead miles breaks even at $2,430. Anything below that pays the truck to lose money, no matter how good the rate per mile looks on the loaded miles alone.

Freight Broker Margin, Rate Per Mile & FSC

Q: How do you calculate freight broker margin?

Margin dollars = customer rate - carrier pay. Margin percent = margin dollars / customer rate. A load billed to the shipper at $2,400 with $2,000 paid to the carrier earns $400, which is a 16.7% margin. Dividing by carrier pay instead of customer rate gives markup (20% here), a different and larger-looking number — brokers quote margin, so be explicit about which one you mean.

Q: How do you calculate rate per mile?

Rate per mile = linehaul rate / loaded miles. A $2,400 load over 1,200 miles is $2.00 per mile. Include deadhead miles in the denominator to get the all-in rate per mile, which is what the truck actually earned: the same load with 150 deadhead miles is $2,400 / 1,350 = $1.78 all-in.

Q: How is a fuel surcharge calculated?

FSC per mile = (current diesel price - base fuel price) / miles per gallon. With diesel at $4.10, a base of $2.50, and 6.5 MPG, the surcharge is ($4.10 - $2.50) / 6.5 = $0.246 per mile, or about $295 on a 1,200-mile load. Both the base price and the MPG assumption are contractual, so they must be agreed in writing before the first load moves.

How do you calculate freight broker margin?

margin $ = customer rate − carrier pay margin % = margin $ ÷ customer rate

Bill the shipper $2,400, pay the carrier $2,000, and the load earns $400 — a 16.7% margin.

Watch the denominator. Divide by carrier pay instead and you get markup: $400 ÷ $2,000 = 20%. Same load, bigger-sounding number. Brokers quote margin on the customer rate; if someone quotes 20% without saying which, ask.

What is a typical margin?

Brokerage gross margins commonly sit in the low-to-mid teens against the customer rate. Contract freight is usually thinner and steadier; spot freight swings both ways. But the percentage is the wrong thing to optimise on its own — margin dollars per hour of your attention is the real number. A 20% margin on a $900 load that took four calls and a check call every two hours can be worth less than a 10% margin on a $3,000 lane that books itself every week.

How do you calculate rate per mile?

rate per mile = linehaul rate ÷ loaded miles all-in rate per mile = linehaul rate ÷ (loaded + deadhead miles)

A $2,400 load over 1,200 miles is $2.00 per mile. Add 150 miles of deadhead to reach the pickup and the truck actually earned $2,400 ÷ 1,350 = $1.78 per mile. That 11% gap is where a lane that "pays well" quietly stops paying well.

What does deadhead cost?

deadhead cost = deadhead miles × operating cost per mile

At $1.80 per mile of operating cost, 150 deadhead miles burns $270 before the trailer has anything in it. Deadhead is never billed as a line item, so it only ever shows up as missing profit. A load that requires long deadhead needs a higher rate to be the same load.

How is a fuel surcharge calculated?

FSC per mile = (current diesel price − base fuel price) ÷ MPG

Diesel at $4.10, a contractual base of $2.50, and a 6.5 MPG assumption:

($4.10 − $2.50) ÷ 6.5 = $0.246 per mile → ≈ $295 on 1,200 miles

Both inputs are negotiated, not physical facts. A base of $2.50 versus $2.90 changes the surcharge on that same load by roughly $74. Agree the base price, the MPG, and the index source in writing before the first load moves.

What is detention, and when does it actually get paid?

Detention is what a carrier bills when a shipper or receiver holds the truck past free time — conventionally two hours — usually at an hourly rate with a daily cap. Four hours at a dock, two hours free, $75 per hour, bills two hours: $150.

The rate is the easy part. Detention gets denied on documentation, not on price: if arrival and departure times are not timestamped on the bill of lading or captured by the tracking system, the claim dies. The paperwork is the pay.

How do you find the break-even on a load?

break-even = (loaded miles + deadhead miles) × operating cost per mile

Input	Value
Loaded miles	1,200
Deadhead miles	150
Operating cost per mile	$1.80
Break-even	$2,430

At $2,400 the load looks fine on a $2.00 loaded rate per mile and is losing $30 once deadhead is counted. Every "cheap freight" argument is really an argument about which miles you counted.

Run all six calculations in the free calculators →

Where the hours actually go

None of this math is hard. The reason small brokerages leak money is that the arithmetic competes with the back office: chasing rate confirmations, matching PODs to invoices, re-sending the same document to the same accounts-payable inbox, and dunning at 45 days. That work is repetitive, deadline-driven, and exactly the shape a machine handles well.

That is the problem FreightDesk AI was built for — it reads the billing inbox, drafts the invoice, chases the missing paperwork, and hands you the exceptions. The case study behind it, covering 18 accounts-receivable workflows, is here.

Rates, margins, and MPG assumptions in this guide are illustrative examples for showing the arithmetic, not market quotes or benchmarks. Confirm your own operating cost per mile and contract terms before pricing freight.

Tools referenced in this guide

Freight broker calculators — rate per mile, deadhead, margin, detention, fuel surcharge, break-even. Free, no signup, runs in your browser.
FreightDesk AI — the AI back office for small brokerages.
HwyHaul LoadLink case study — 18 AR and billing workflows automated.

Freight broker margin, rate per mile, and the rest of the math

How do you calculate freight broker margin?

What is a typical margin?

How do you calculate rate per mile?

What does deadhead cost?

How is a fuel surcharge calculated?

What is detention, and when does it actually get paid?

How do you find the break-even on a load?

Where the hours actually go

Tools referenced in this guide

Quick answers

How is broker margin calculated?

Margin or markup?

What is all-in rate per mile?

How is FSC calculated?

When does detention start?

What is the break-even rate?