While the challenges facing the trucking industry may vary from year to year, the one consistency is that companies managing private and/or dedicated transportation fleets are being forced to do more with less. Following the ever-increasing need to improve efficiencies, the digitization of the supply chain proved to have a substantial impact on the efficiency and flow of freight operations in 2018.
As we review our predictions from last year, it’s safe to say most of them held true. Data sharing and open access, the onset of APIs, instant pricing + booking, and technologies such as machine learning have made all the difference in getting the most out of finite transportation resources.
For 2019 we expect even more pervasive digitization than last year, ultimately driving towards a more unified experience for shippers and carriers alike.
- Shippers Will Improve DC Processes
Having witnessed initial digitization successes, shippers will recognize that there is more to gain from automating and leveraging data for the benefit of the distribution center. This includes the desire to dramatically reduce truck waiting times, automating and increasing appointment efficiency, and coordinating arrivals and departures better. It will be all about enabling shippers to bring technology further inside the supply chain operations. Furthermore, as contract rates continue to slide and the pendulum is swinging back in favor of the shippers, 2018 peak prices remain on everyone’s mind. Shippers drive to reduce risk across the supply chain and embrace innovation will open them up to greater collaboration within the industry. Carriers, shippers and 3PLS will work together to integrate operations and data to provide more context, which in turn will help shippers recognize patterns and enable them to balance their risk better.
- Carriers Open Up for API Integrations
Carriers will follow shippers in their pursuit for APIs and embrace similar openness. Fleet operators will share data for mutual industry benefit leading to a more efficient service to shippers. Software will also become more open to utilization across different platforms.
- New Economic Models for Contracted Capacity
The traditional model no longer works. The promise of a 12-month fixed rate for each lane leads to wrong incentives and often sees shippers missing budgets with rates that are out of touch with the market and constant contract renegotiation. In 2019, brokers and carriers will collaborate better and begin adopting modern pricing tactics very similar to those derived from the financial and airline industries, which are more advanced when it comes to pricing and risk allocation.With these advanced pricing and risk models, shippers will be able to find ready access to capacity with rates that are dynamic and in line with market conditions.
- Full Service: door-to-door integrations
Just as consolidation will happen across brokers, the big players are looking to offer a unified experience for their customer across all modes. We will start seeing integrated providers offering door-to-door supply chain solutions across modes with fewer intermediaries and unified visibility.
What are your thoughts?