The Agent’s authority will usually be set out in a written Agency Agreement.Īn Agent can play an important role in a company’s supply chain by helping it to secure better prices and terms from suppliers, and by helping it to maintain good relationships with customers.įor example, by liaising with suppliers, the Agent can obtain lower prices for the Principal on particular goods. The Agent may be authorised to negotiate and conclude contracts in the Principal’s name, and may bind the Principal to those contracts. Because an agent likely has relationships with several carriers, it may be tempted to recommend the cheapest or highest-paying but suboptimal carrier in order to secure more business or build better relations with that carrier.Īn Agent is an entity appointed by a Principal to act on its behalf in business dealings with another party (the Other Party). There is potential for conflict of interest when you hire an agent to arrange shipments for your company. For this reason, hiring an agent may be more cost-effective than entering into a direct shipping agreement with a carrier. Agents know which carriers offer reliable service and low rates, and they often have longstanding relationships with carriers that give them access to special promotions or negotiated rates not available elsewhere. By working with an agent, shippers can save time and money by taking advantage of the agent’s knowledge of the shipping industry.īecause of their role as intermediaries, agents can provide shippers with valuable information about the shipping industry. The agent typically acts as an intermediary, negotiating rates and arranging for the transportation of goods. An agent is a third party that facilitates the transport of goods between two other parties.
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