In this post, we explore truckload pricing tools as an important part of every digital freight brokerage’s operations. This post is part of a series of posts that aims to shed light on the many new and innovative freight tech solutions that empower freight brokers to transform digitally.
This post was written in collaboration with Nick Dangles @ Kinetic. Kinetic is committed to helping freight tech companies stand out by educating transportation providers on their freight tech options.
Truckload pricing software is key to a broker’s ability to buy freight and sell capacity profitably in the daily spot environment. By tracking both carrier rates and customer rates in real-time, it enables freight brokerages to make competitive bids on both ends. Meanwhile, the added data visibility allows brokers to forecast future contracted freight and plan accordingly.
Why Do Truckload Rate Benchmarks Matter?
As a freight brokerage, you live and die by your pricing. If your fixed rates drift below market value, you run the risk of losing your top carriers, permanently. And if your spot rates are wildly off-market, you may not be able to find a carrier that will take your freight off a load board without a hardball negotiation.
Able to track freight and carrier rates in real-time, truckload pricing tools make it possible for you to set competitive rates for all types of freight -- be it dry-van, refrigerated, or flatbed. You can see pricing trends geographically, which allows you to set realistic prices for individual lanes. And you can lean on predictive analytics to forecast future rates across the board.
Accurate rates enable your team to sell capacity more profitability and drive trust with your carriers to enable more digital bookings and increase the likelihood of carrier re-use.
Key Uses of Truckload Pricing Tools
Accurate truckload rate benchmarks depend on insight into current loads and market behavior. Here are a few beneficial types of data you can collect by using a truckload pricing tool.
Pinpoint Market Rates
View historical pricing data to get accurate information on the going rate for freight per mile. And compare current rates against historical data to see how spot and contract pricing are trending.
Identify Regional Trends
Segment truckload pricing by lane to get the right context for every load cost. With freight benchmarking tools, you can also group regions into clusters that have similar patterns for better clarity.
Assess Supply and Demand
Use proxy metrics like load-to-truck ratios and tender reject data to assess carrier supply and demand. The added context enables you to offer your carriers appealing rates even if historical pricing information is not available.
Predict Ratings
Leverage predictive ratings to forecast future truckload pricing by region and lane. And use this data to make sure your rates never fall outside the acceptable range.
3 Truckload Pricing Tools for Brokers
There are quite a few benchmarking tools out there that freight brokerages can adopt and use to improve their pricing strategy. Let’s look at some of the leaders.
DAT iQ (Formerly DAT RateView)
To go along with its DAT One platform, DAT offers a powerful set of freight benchmarking tools under the label of “DAT iQ” to make spot and contract pricing easier. Using it’s Ratecast feature, brokers can forecast 8 days ahead (for spot freight) and 52 weeks ahead (to inform long-term carrier contracts).
At the same time, they can dig deeper into the data analytics features to uncover rate volatility, seasonal impacts, and geographical variability in truckload pricing trends.
Freightwaves’ benchmarking tools are powerful for lots of reasons. You can use them to review historical data on all different lanes and types of freight. You can leverage predictive analytics to determine the impact of current gas prices and market activity on future freight rates. You can even monitor real-time events -- like the weather -- that might impact the truckload pricing for spot freight.
Like the others on this list, Truckstop offers a full suite of features that you can use to benchmark truckload pricing by zip code or region. The data covers nearly 160,000 active loads every week and can forecast 52 weeks into the future using historical and current data.
Is One Truckload Pricing Tool Enough?
While you may only need one freight benchmarking tool to run dry van rates on the same lanes, not every situation is that simple.
For example, if you need to move spot freight, you have to be able to measure supply and demand in real-time. That means the provider you choose must have the right proxy metrics and a large enough data set to deliver accurate information. In addition, if you have niche needs like bulk or flatbed freight, generic data won’t cut it. Your provider will need to have wide coverage and detailed data in that given market segment to actually help you benchmark truckload rates correctly.
Given that, it’s critical to select a provider (or set of providers) that offers what you need right now. You should also prioritize providers that embrace innovation, as the new features and technology they’re rolling out can give you a competitive edge in pricing your freight. Here are some early-stage innovations to look for:
Truckload rate forecasting technology
Increased data density within small time windows (e.g. last 12 hours, last 3 days, last 7 days)
Integration with other capacity management tools, like Parade
Since every brokerage operates under various niches and has different truckload pricing needs, not all freight benchmarking software will offer them the same value. However, the right tool can help your team win more loads by enabling you to buy truck capacity at the right price and sell the same capacity with an acceptable level of risk.
The important thing is to connect your truckload pricing tools to your digitized capacity management workflow, so that your customer and carrier partners can trust that your team’s rates are grounded with respect to the spot market. This trust translates into increased carrier reuse and more digital bookings.