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Waste is never positive, and that’s especially true in the transportation industry. Underutilized capacity and empty miles add costs and efficiencies for shippers and carriers.
Many small- to mid-size business (SMB) shippers attempt to run their freight departments alone. They feel that what they’re doing is working fine and that any type of outside relationship would only serve to increase costs and decrease service levels.
Nothing could be further from the truth. When multiple shippers and carriers collaborate, either directly or with the assistance of a 3PL, all can experience more efficient and cost-effective operations.
Between a reliance on manual processes and reluctance to share data, early collaboration efforts were haphazard and rarely generated enough load density to benefit everyone. Collaboration and freight-matching tended to be both people- and paper-centric, with little external sharing.
Many parties also viewed collaboration as a one-time effort instead of a component of ongoing continuous improvement. Some would allocate resources to the process, only to pull them back during periods of resource constraint.
The expansion and evolution of technology have helped shippers and carriers resolve many of their collaboration challenges. This extends even to social media technology.
A dozen years ago, most companies forbade employees from using social networking apps at work. But the techniques that lead to success in social media networking translate well to the freight lane matching process. Not surprisingly, with social media now ubiquitous, the procedures required for effective freight lane matching meet with greater acceptance.
Technology provides the ability to filter enormous amounts of data to identify where the real collaboration opportunities lie. Companies can access an extensive network of interested shippers without having to abandon their existing TMS.
Think of digital freight matching technology as a dating app for the freight world, without having to sift through a series of bad dates to find your best match.
Currently, many digital freight companies focus on matching specific trucks with specific loads on a transactional basis. However, more and more are working to develop synergistic relationships that create long-term benefits.
One of the most obvious benefits of collaboration is that shippers gain visibility into capacity available from dedicated and private fleets. Capacities that would otherwise be deadheaded often can be contracted for below-market rates. This helps not only in freight lane matching but procurement as well.
Additional benefits of digital freight lane matching for carriers and fleet owners include reducing empty miles, broadening service areas, increasing asset utilization through drop-trailer loads, and improving sustainability. Some companies see increased driver retention, as well.
Through digital freight lane matching, shippers can input details once and see all available lane, carrier, and rate options. Carriers can do the same to fill their available capacity.
The hardest part of any sharing program between companies is figuring out how to start. Digital freight matching programs should be able to handle contracts, invoices, and the Bill of Lading (BOL) and provide business insights such as tracking and driver performance metrics. Shippers should be able to:
Many companies solve this by engaging a 3PL for some or all of these services. 3PLs equipped for digital freight lane matching can provide comprehensive services such as:
Building a collaboration network and implementing digital freight lane matching can seem impossible when you’re already trying to manage and control a million other things.
Redwood Logistics has you covered. We provide expert, complete 3PL services for all companies and a comprehensive, open Logistics Platform as a Service (LPaaS) for those whose needs extend to what you might think of as “the works.”
How? Our LPaaS open ecosystem approach bridges the gap between your logistics and technology to deliver an open, collaborative, productive, low-risk way to mix and match the right physical and digital solutions for your business.
Let’s collaborate – on collaboration – to help your company gain efficiency and cost savings. Contact Redwood Logistics today for more information on our digital freight lane management solutions.