Many aspects of truckload freight management, freight matching, and transportation today remain governed and greatly influenced by technology. New tools, platforms, dashboards, and services make it easier to stay ahead of the competition. Freight brokers are using office productivity software, networking platforms, security systems, phone systems, cloud-based storage sites, digital communication dashboards, and more to optimize their business overall. Further, embracing technology and modern innovation remains essential for freight brokers who want to create a competitive differentiation using technology to enable capacity procurement optimization. However, without adopting the right technology in the tech stack, 50% of small and mid-sized brokers (SMBs) may go out of business. Keeping up with new advances in technology and using automation and innovations form a critical part of truckload freight operations and management.
The Challenges of Operating Within Finite Profit Margins and Limited Technologies
Numerous challenges face truckload freight brokers each day when stuck working with outdated technology and old processes. Getting hung up in past cycles and methods can cause problems that limit profits and overall growth. Some of the most significant challenges the old-fashioned methods can cause include:
- Lack of insight into current market trends and customer demands.
- Outdated data and faulty processes delay and contribute to poor communications.
- Slow response time to complaints, issues, and disruptions within the supply chain.
- Inefficient and resource-intense capacity procurement for truckload freight loads.
- Missed opportunities for expansion and growth due to inability to find capacity at the right freight cost per mile for shipper customers.
- Higher costs and expenses resulting in reduced profits and returns on investments.
Freight technology drives the transportation market forward and continues to play a pivotal role for digital freight brokerages today, especially as it relates to getting loads covered for shipper customers. For example, brokers are using freight aggregation platforms, like newtrul, to find meaningful capacity with carriers that fulfill service needs and offer a rate that fits the brokers’ desired rate with enough room for the broker to maximize their margins. Let’s take a look further at how technology reduces the total cost to serve for small to mid-sized brokerages.
Increased Use of Tech-Driven Brokerage Processes Enable Small-to-Mid-Sized Brokers
Managing the often complex processes of truckload freight operations today can put brokers in a unique position. According to a recent report by McKinsey & Company, many industries, such as the financial sector, among many others, are poised to automate tasks that could free up more than 40% of worker’s availability. Those same benefits exist in brokers’ financial and accounting processes, including those of SMB status. Real estate, transportation, and general brokerage prepare to make similar shifts of their own soon. Tech-driven brokerage processes in the transportation and freight marketplace can improve truckload management and freight procurement across many industry niches. Further, using automation features within technology platforms reduces operational costs for brokers, allowing individual agents within the brokerage to cover loads more efficiently, resulting in a higher overall margin. Without embracing automation, big data, smart technology, and innovative tools, small and medium-sized brokers will struggle to take market share away from the tech-heavy legacy freight broker giants that thrive in today’s market.
Additional Benefits of Digital Technology to Improve Brokerage of Truckload Freight
Better data access, enhanced analysis, improved insights, and faster responses will help brokers in many ways. The benefits of digital technology in the modern freight market cannot be overemphasized and can bring many great benefits that include the following:
- Faster access to and processing of available freight capacity and loads.
- Networking with independent drivers and smaller fleets to add meaningful capacity by onboarding quality carriers.
- Better logistics marketplaces and management protocols.
- Conduct brokerage business remotely and speed agent onboarding by using digital platforms and mobile apps.
- Improved adaptation to rapidly changing processes.
- Ability to increase the use of dedicated lanes and shipping modes.
- Enhanced communications between team members and vendors.
- Focused truckload freight management protocols and guidelines.
- Quicker response to inevitable disruptions and problems.
- Reduced total cost to serve, resulting in healthier profit margins and ability to reinvest in the business to grow.
Keeping up with currents trends and processes has never been more critical for freight broker management than it is in today’s more volatile truckload freight environment. Tender rejections are at all-time highs. The truckload spot market has seen increased costs. Capacity is in short supply. And shippers have multiple options on the market, including competitors of the current freight brokerage they are using. Keeping up with the times is essential to gain new business and survive.
Increase Truckload Freight Efficiency With an Easy-to-Deploy and -Implement Platform
Accepting advances in technology and seeing the value in modern innovation remains a critical aspect of modern-day freight brokerage. However, it is simply not enough to know and accept this truth for shipper to carrier relationships. Proper analysis and application also remain paramount. Keeping up with new advances, applying automated tools and technology, updating systems and procedures as needed, and making good use of technological advances must be the norm. All form the key to successful truckload freight operations and management today. Freight management parities can quickly improve and maintain efficiency by keeping the right platform in use and implementing a solid collaborative relationship with a skilled and experienced vendor. Connect with newtrul to get started.
