04 Dec Freight Brokers and the Future of Logistics
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Where Freight Brokers Fit In
Freight brokers have been around for a long time. In fact, when the passage of the Motor Carrier Act of 1980 deregulated the trucking industry, the number of carriers began to expand. This created a fragmented market and perfect conditions for third-party providers. And for the past 40 years, the industry has seen wide growth.
Successful freight brokerage operations offer both shippers and carriers increased bandwidth through a myriad of value-added services designed to streamline processes. As a vital factor in connecting the supply and demand sides of the shipping business, freight brokerages are generating more revenue in 2018 than they did in 2017.
In a tight market such as 2018, freight brokers continue to provide lots of value. However, the shifting environment of the logistics industry has some concerned about the viability of brokerage operations into the future.
A Digital Approach
In the past few years, a flurry of activity focused on freight brokerage operations has occurred in the venture capitalist arena. Major technology players are using their ample resources to join the ranks of companies designing and delivering virtual connection services between shippers and carriers.
Competition is nothing new in the third-party logistics business. With more than 15,000 registered freight brokers nationwide, some new players are entering the fray and this indicates major disruption.
These new players are hyper-focused on creating and implementing technology-forward services. This move toward a digital, more automated approach in freight operations is attributed to the technological advancements in several silos of transportation.
From self-driving trucks to help lower costs and improve efficiencies, to highly predictive freight and shipping analytic software that taps the power of big data, the digital disruption coming to the freight industry is intended to make shippers and carriers less dependent on third-party intermediaries.
However, distributing new technologies on a grand scale is challenging at best and overwhelming at worst from slow adoption to the necessary capital needed to replace or supplement legacy systems already in place. That said, even with these known obstacles, large technology companies are in the freight industry to stay.
Freight Brokers and the Future
Digital disruption in the freight and transportation industry is part of the landscape. Freight brokers should not take it lightly–no matter their location, niche, or percent of market share. But adapting to the revolution taking place – and continuing successful operations as a freight broker – is possible for those who take proactive steps.
One of the most critical components of adding value to customers and carriers in the ever-changing freight environment is embracing the technology currently available to brokers.
There are countless solutions for managing the freight process. A variety of options exist to save time, reduce hassles, improve communication, and offer invaluable data to benefit broker operations on a large scale. Finding the best-fit solution not only improves in-house processes, but also adds value to customers and carriers.
At AM Transport, we stay on top of technological trends.
We’ve invested years in the study and practical use of the best digital solutions the industry has to offer! In the past couple of years, we’ve implemented some important technologies.
- Our TMS (transportation management system) is Revenova, powered by SalesForce. With customer, carrier, and multi-modal transportation management, we offer customizable views, real-time reporting, claims, tracking and tracing, and a whole lot more. We love Revenova so much, we’re an authorized small-to-midsize business reseller. We’d love to talk to you more about the big advantages Revenova offers, so please contact us for more information.
- Our state-of-the-art tracking software, LoadTap, works in conjunction with our TMS. We know where your freight is 24/7/365. We’ve got to know Param and his team quite well, if you’d like a demo we’d be happy to arrange one!
- With the power of FreightWaves Sonar, we study and analyze industry data. Our data specialists use this information to your benefit.
- Easy payment is important to us, that’s why we’ve partnered with FreightRover to simplify and streamline carrier payment.
The digital wave is here to stay, and freight brokers must move forward with it. But in doing so, we can’t forget relationships. To fully prepare for the future, freight brokers must strengthen and cultivate relationships with current partners and customers.
Technology cannot replace the human aspect of the freight broker business–no matter how advanced or cost-effective it may be. Brokers can proactively insulate business relationships from digital disruption. It requires simple check-ins with customers and carriers, consistent evaluations of processes, and a robust follow-through of feasible suggestions.
While there is no stopping the influx of competition and digital disruption coming to the freight industry, freight brokers can view these changes as prime opportunities. Now is the time to update systems and processes, strengthen customer relationships, and ultimately, lay the groundwork for business growth in the years to come. If you’d like to know more about the technologies utilized at AM Transport, give us a call. We love talking tech!