Hot Takes
Leveraging software to aid in the development of shipper relationships is something that everyone faces. How can we serve our customers and shippers on more of a relationship basis versus a transactional one?
Currently, an overwhelming majority of loads are transactional in nature. A carrier calls in for a load on a spot board, completes onboarding and disappears into the wind. More companies are realizing the opportunity cost of one-and-done carriers.
Shippers also have tendencies to avoid building and developing relationships with their various transportation providers. You win a couple of lanes on a bid, get a carrier in and you’re done. Occasionally you will get a few extra lanes here and there but it can remain quite transactional in nature.
The real question is how can you improve your value add to both the shipper and the carrier? Is it in customer service, cost savings, integrated technology or a combination of services?
Most of the digital brokerage startups are realizing the need to mesh seamlessly with their customers, shippers and carriers. The one downside of that is there are now a plethora of TMSes. If you don’t love and can’t afford an existing solution, then a homegrown system is your best option.
FreightVana, the Phoenix-based hypergrowth 3PL with a wealth of industry experience, is no exception. It has developed a proprietary partnership platform that does things a little differently than most. It is driven by radical collaboration with its shipper and carrier networks and has built its business on a foundation of transparency and trust.
“While many traditional and newly formed intermediaries seem hyperfocused on satisfying the capital markets and their shareholders, we’ve stayed keenly focused on creating sustainable value by solving systemic operational and technological problems for the shippers and carriers in our growing network,” said co-founder Shannon Breen.
Parade is doing something similar with a carrier retention and freight-matching tool that can integrate into an existing TMS. It offers email templates, freight matching, record keeping of previous carriers that ran lanes, etc. Parade places the collaboration and relationship building on the individual reps, but gives them the tools they need to retain and develop those carrier relationships.
Whether you choose the homegrown option or something you can customize to suit your needs, it’s clear now more than ever that shippers are looking for integration. They want to have a partnership, trust and the 3PL to be on their side and work with them like they work with carriers.
Quick Hits
Just around the riverbend – Pocahontas might have been on to something when she was canoeing through the rivers. The first thing everyone mentions in the supply chain bottlenecks is the lack of capacity and drivers. What if we used water as opposed to roads?
Hear me out: River barges can hold the equivalent of 70 tractor-trailers and 16 railcars, roughly. With the amount of freight you can put on a river barge versus a full truck, there’s something to be said for getting shippers to consider some waterway movements — not to mention that barge rates are typically half the cost of rail rates and almost twice as less as a truckload rate.
The U.S. waterway system consists of over 12,000 miles of inland waterways and 13,000 miles of coastal channels, 360 commercial ports and 237 lock and dam chambers. There are some critical infrastructure improvements that need to be made, and requests for funding have been made and are sitting in bills on the House floor.
If we can get shippers to move ever so slightly away from the just-in-time production and allow for a few more days on a shipment, you could make a lot of progress with the inland waterways.
Come and get it – As if we didn’t already know how busy the LA port has been over the last few months, it was recommended by the White House that the port should be operating 24/7. We love to hear it. However, as we learned during the OceanWaves interview with Executive Director Gene Seroka, there are bottlenecks at the Port of LA, in part, because containers aren’t getting picked up.
Walmart and other big-box retailers, FedEx and UPS have detailed plans to expand their container operations to help the ports get “unclogged.” Walmart has committed to moving goods more at nighttime by as much as 50% over the next several weeks. Home Depot and Target are committed to moving 10% more freight through the port at nighttime as well.
Shadow operations are a go, but also expect some more nighttime action if you have a big-box retailer as your customer.
Market Check
Go West, young man. Have you been told it’ll be about three days till you get there? Markets in the West are averaging about a three- to four-day lead time from booking to when the load actually moves. Parts of the West typically hover around three days as the most volatile market has shown us. Albuquerque, New Mexico, Denver and Las Vegas are slightly above their typical averages, while Twin Falls, Idaho, and Grand Junction, Colorado, are running ever so slightly lower lead times than typical.
Most shippers that are regularly shipping into these areas are familiar with the lead time needed to generate trucks, but if you have a shipper that isn’t, you have to have those conversations. If they need something moved to these areas today, it might be tricky and a much higher price point than they were anticipating.
Who’s with Whom
After a five-month search, Walmart announced that Fernando Cortes, the chief supply chain officer at Keurig Dr Pepper Inc., is moving to head its U.S. transportation as the executive vice president of supply chain operations. Cortes will oversee one of the nation’s largest private fleets, comprised of 6,100 tractors, 61,000 trailers and more than 7,800 drivers. Read more here
Tiger Cool Express plans to acquire a former Union Pacific Cold Connect warehouse in the Pacific Northwest. Once it acquires the facility, it plans to develop an intermodal ramp at the site. The goal is to expand export, boxcar and temperature-control consolidation services to customers in the Pacific Northwest. Read more here
The more you know
Untapped potential: Far too little freight on US waterways, experts say
Walmart boosting off-peak container processing in LA by up to 50%
‘Unprecedented’ freight demand, labor challenges next year, Heartland Express says
