Want the load's profit after every cost? Use the Canadian Load Profitability Calculator to see net profit per load.
Factoring your invoices? Use the Canadian Freight Factoring Cost Calculator to price the cost of factoring on each load.
How freight broker margin is calculated
A freight broker (or freight agent) buys capacity from a carrier and sells it to a shipper. Your margin is the spread between the two. This calculator starts with the linehaul spread — your customer (shipper) rate minus your carrier (buy) rate — and adds the fuel surcharge spread and accessorial spread if you bill and pay those separately. Together these are your gross margin in CAD. Subtract any factoring or quick-pay fee and your overhead per load, and you get the net margin you actually keep.
The margin % shows your net margin as a share of total customer revenue, and the carrier pay % shows how much of the customer's money flows through to the carrier. Add a number of loads to project the gross and net margin across a week or a month. Every number comes from your own rate confirmations and agreements — none is supplied or assumed.
| Figure | Formula |
|---|---|
| Total customer revenue | customer rate + customer FSC + accessorial revenue |
| Total carrier cost | carrier rate + carrier FSC + accessorial cost |
| Linehaul spread | customer rate − carrier rate |
| Fuel surcharge spread | customer FSC − carrier FSC |
| Accessorial spread | accessorial revenue − accessorial cost |
| Gross margin | linehaul spread + FSC spread + accessorial spread |
| Factoring / quick-pay cost | total customer revenue × factoring % |
| Net margin | gross margin − factoring cost − overhead per load |
| Net margin % | net margin ÷ total customer revenue × 100 |
| Carrier pay % | total carrier cost ÷ total customer revenue × 100 |
| Period gross / net margin | per-load figure × number of loads |
| GST/HST collectible (info) | gross margin × GST/HST % — pass-through, not in margin |
Run the numbers with and without the fuel and accessorial spreads, the factoring fee, and overhead to see where your real margin ends up. A healthy-looking linehaul spread can shrink quickly once a quick-pay fee and overhead come off — the net margin and net margin % are what actually matter.
Frequently Asked Questions
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