Domestic transportation capacity is experiencing uncertain times in the wake of the COVID-19 crisis. A recent Gartner report states, “in the U.S., Gartner noticed spot market rates increasing while at the same time carriers were continuing to reject an increasing number of freight tenders.” (1) While volumes have begun cooling considerably, there is still a lot of volatility on the radar as manufacturing in China and the rest of Asia comes back online and a surge of products begins to hit U.S. distribution networks.
It comes as no surprise that fluctuating capacity and cost are forcing the industry to bend and change with the times. Shippers have to be proactive and open to collaborating with carriers to ensure freight capacity is available, especially as the crisis progresses. How? Shippers will need to expand their views. As opposed to focusing on current carrier relationships and immediate carrier needs, they will have to find a way to accurately forecast and expand their carrier relationships over the upcoming weeks and months. One way to do this is with the help of digital freight platforms and their various offerings.
The Journal Of Commerce (JOC) reports that in light of the COVID-19 crisis, “some shipping and logistics companies are even ‘pushing’ an accelerated usage of their online tools in an effort to prioritize their scarce resources.” (2) A step in the right direction, though it’s also one that clearly shows that the freight industry is lacking in technological adoption. Many processes are still painfully stuck in the past. Needs like “the need to move physical bills of lading around, the need to provide customs documents physically signed by people who no longer are available in their usual offices, the need to handle physical freight payments at shipping lines’ counters” (3) and more, demonstrate waste in the long-haul trucking industry the importance of becoming fully digitized.
Various experts agree, COVID-19 has forced the freight industry to embrace technology at a faster rate, and for good reason. As the JOC states, “The pandemic will not be the cause of a digital transformation—that transformation has slowly been getting underway the past few years—but it will accelerate the transformation.” (4) In a Freightwaves interview, Flexport CEO, Ryan Peterson said, “It’s not just customers adopting tech and how it will help them. It’s about how the platform of the provider enables remote work, connecting people, companies and factories all over the world.” (5) The ability to use tech to move loads, to keep people safe, and to connect all parties involved allows the industry to keep moving in a world that is all-but frozen due to social distancing mandates and health concerns.
According to Gartner, “a digital freight network is an open, fully connected freight marketplace that uses machine learning, automation, and other software services to efficiently connect shippers and carriers. Digitized transportation networks provide an alternative to traditional brokers, load boards and the spot market, which remain time-consuming and collect information from carriers and shippers, but don’t support true collaboration. These digital freight networks can help companies that are looking for real-time available capacity or looking to reduce transportation costs during the current crisis, as well as during future challenging times. Digital freight networks are helping shippers overcome COVID-19 challenges by delivering the reliability of an asset-based carrier and the flexibility of a broker.” (6) Gartner further notes “in addition to digital freight networks, we also see other technologies that can provide insights and improvements to the available freight capacity and focus on increasing the load percentage of the truck.” (7)
SemiCab offers a fully connected freight marketplace focused on optimizing freight capacity by creating round trips that virtually eliminate empty miles from the long-haul trucking industry. To create visibility, the platform uses real-time data from API-based load tendering and pre-built integrations with TMS solutions and ELD partners. To build fully loaded round trips, it uses AI/ML predictions and proprietary optimization models. We believe that fluctuating capacity and cost are only going to get more extreme and technology, like the SemiCab platform will be key to smoothing out ongoing unpredictability in the market.
COVID-19 has changed our industry. Fluctuating capacity and cost are only going to get more extreme. Each of us is going to have to shift and change to adapt. This means investigating new technology, like the SemiCab platform, that effortlessly matches supply with demand to smooth out unpredictability in the market.
During this time of need, we’re offering a variation of our service to carriers to help them through the next few months of uncertainty—free load searching. It’s our hope that this service will help shippers and carriers efficiently keep goods flowing while becoming better acquainted with the SemiCab platform. As of April 20th, any carrier can access the platform, see what loads are available, and take the steps necessary to book available loads.
Clearly, it’s a good time for the freight industry to continue its exploration of transportation technologies to improve efficiency and solve capacity volatility. Transportation forecasting tools, TMSs, advanced analytics tools and visibility tools, will deliver carriers and shippers better insights into their current and future transportation needs. As the JOC says, this crisis has shown us that “it is possible to keep the supply chain running and that online tools are indeed helping in this endeavor.” (8) Digital freight networks and their ability to provide real-time capacity and pricing for domestic freight will be key to navigating the uncertainties that lie ahead.
SemiCab is a Collaborative Transportation Platform that uses Predictive Optimization™ technology to create Orchestrated Collaboration™.
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