From Booking to Delivery: Loadsmart moves first fully automated truckload shipment

 

Loadsmart has just moved its first fully automated shipment from booking to delivery: no human contact occurred between Loadsmart, the shipper, the carrier or the driver. First, the shipper hopped online and quoted the cost to ship on a 53’ dry van truck from Philadelphia, PA to Virginia Beach, VA. The system generated an instant price ($ 565.62 at the time) and the customer booked in just a few seconds. Through an algorithm our system automatically identified the best carrier to move the load – among thousands in our roster – and sent an electronic request to the carrier’s dispatcher (which we internally call a “live job”) with an offer at $525.00.

With one click the dispatcher accepted the job electronically and the rate confirmation was distributed automatically. The carrier’s driver was notified and downloaded the Loadsmart app. GPS tracking and driver updates followed from pickup to delivery, where the driver submitted the Proof of Delivery via the Loadsmart mobile app.

Loadsmart made no calls, wrote no emails and had no human contact with the shipper, carrier or driver. No sales or operation workforce was needed to capture the margin of $40.62.

This is a huge landmark in Loadsmart’s history. It demonstrates that technology can and will have a big impact on the industry. If you have read our previous posts about the fair skepticism about so-called “uber for trucking” startups, you know where we stand: Loadsmart is not your usual “tech broker”. We are a technology firm: an engineering and design-driven company that is researching, prototyping and building transformative technology for logistics. We are not focused on incremental changes; we have created a tech lab to re-imagine the whole truckload shipping flow – from booking to delivery.

Each of the automated steps described above contain a multitude of potential issues that had to be dealt with. For example, for a first-time driver to download the app in the Google or Apple store, without being contacted or trained by us, it took a huge amount of UX/UI design, feedback and iteration. We also have a a 24/7 operations team monitoring all shipments and ready to take over.

Loadsmart is still learning, tweaking and improving its system to make full truckload shipping seamless for both shippers and carriers. But this event tells us that we are in the right path.

We got here with a cohesive team by keeping focus and obsessing about transformative technology. This is just the beginning.

See the announcement video here and our Loadsmart Press Release – Aug 22, 2016.

 

Felipe Capella is co-founder and Chief Product Officer.

 

 

Are “Uber for Trucking” Start-ups Stalling?

 

In the past couple of years several companies labeled either by themselves or by the press as “Uber for Trucking” have launched their products claiming to revolutionize the trucking and freight brokerage industry. Millions of dollars were poured into these start-ups by eager Venture Capitalists that saw the huge size of the market and the historical lack of technology as a good opportunity.

It is surely too soon for a broad diagnosis on whether these investments will bear the aggressive return that VCs usually expect. But it is time to recognize that things did not go according to plan for many of these companies. What happened? Are Uber-for-Trucking startups stalling?

Keychain logistics went off the air around February (although apparently their site is back up). Cargomatic sacked both the CEO and COO after laying off half their salesforce. There are unconfirmed reports of layoffs in other start-ups, mainly sales and operations departments. What happened?

To grasp the challenges of the new entrants, you have to understand how start-up funding works. In order to justify a sizable investment, companies promise a new and better technology-driven product and an aggressive growth rate in order to justify an ever higher valuation.

But what happens when companies overestimate the power of their technology and underestimate the market dynamics all while under pressure by unrealistic burn rates? They face two options: (1) fail or (2) focus on growth-at-all-costs in order to justify the next funding round.

When companies survive this scenario by focusing on growth they end up becoming what they had promised to disrupt: a traditional freight broker with 2/3 of their personnel composed of a sales force and an engineering team purely focused on maintaining the system with no bandwidth to work on innovation.

At Loadsmart we try our best to avoid this mistake. We are 100% focused on product-market-fit, which we define as a product that is ten times better than the current market solution. Half of our team is composed by engineers and designers. And we understand that introducing technology and automation into this industry is a marathon, not a sprint – and we plan accordingly.

Before entering “growth mode”, start-ups should focus on building transformative technology, not incremental features. That’s what Loadsmart is doing.

 

Felipe Capella is co-founder of Loadsmart and Chief Product Officer

Uber of Trucking vs Tinder of Trucking

In his latest blog post at Talking Logistics Adrian Gonzales raises an interesting point: Are Today’s Transportation Tech Startups the Uber of Trucking or the Tinder of Trucking?

I agree that moving freight is much more complex than moving people and that the freight industry will not be disrupted by an app only. It is a much more complex industry than people generally imagine. However, based on the three musts for start-ups to succeed, we have to consider the following:

  • Critical mass: once a new startup offers a better way to deal with current industry issues, it only needs to demonstrate critical mass in a specific region, lane or market. That should be enough to generate a strong flow of investments, and that may be too late for incumbents to react. Remember when Yahoo made a $1bn offer to Zuckerberg in July 2006 – Facebook then was not profitable and was only 2 years old. Now Yahoo has just been just sold for $4.8bn and Facebook is worth $347bn. Incumbent 3PLs are nowhere as tech savvy as Yahoo, so when a similar movement happens on the freight industry the results could be even worse for the establishment. In summary, this may happen much faster than people think.
  • Relationships: we believe this is currently true only due to the lack of other exterior signals of reliability. Relationships used to matter if you needed to sleep in another person’s apartment. Now the dual rating system of Airbnb is so reliable that you can trust a stranger to crush in your sofa. Once a strong and reliable online community is built, personal acquaintability should matter less.
  • Quality: industry disruption will only happen once startups stop behaving like incumbents and start acting boldly. Each day companies that begun claiming to be “uber for trucking” end up with the same 2/3 of headcount composed by sales people. Same freight brokerage model with a better user experience and a lot of phone calls.

 

We are trying things that were never done before and we dedicate half of our headcount to software engineers and designers. What do you think start-ups need in order to succeed in the logistics industry?

 

Felipe Capella is co-founder of Loadsmart and Chief Product Officer

Incumbent 3PLs Will Not Disrupt Logistics

Erica Phillips from The Wall Street Journal brought the news that DB Schenker has entered into an agreement with uShip to use its technology in the European market as digital freight-booking platform.

Companies like XPO Logistics Inc. are spending millions of dollars to develop in-house platforms. Others have pursued acquisitions, including United Parcel Service Inc., which last year bought Coyote Logistics, a freight technology firm, for $1.8 billion. Deutsche Post AG took a €345 million ($383 million) write-off on a failed effort to create its own global freight forwarding technology platform.

These efforts by traditional 3PLs to “become a technology company” through massive investment in IT can make sense from a business perspective but will not create transformative innovation. Take XPO for example, which has focused on a great number of M&A deals to grow quickly and consolidate part of the industry. The number of different systems, competing softwares, conflicting APIs and isolated data is staggering. Combine that with the the fact that breaking down is not an option for them: there are thousands of shipments being moved every day and investors looking at revenues and profits constantly.

Therefore technology investment write-offs like the $383 million mentioned in the article should not be surprising at all. The reality is that incumbent 3PLs don’t have the risk appetite or the incentive to be aggressive on technology adoption, as still have to deal with legacy systems arising from decades of operations and recent acquisitions. Big technology spending disclosed by traditional players are more a PR stunt than an actual willingness to disrupt the industry. Coyote is another good example: it operates in an extremely similar manner to any other big 3PL: based on phone calls, an army of salespeople and a traditional brokerage model.

It will be interesting to see what happens with the uShip – DB Schenker deal. The european market has its own peculiarities, and uShip model looks more like a B2C than a B2B. But more importantly, uShip is focused on matchmaking freight with carriers and does not actually operate the shipment movement from point A to point B.

It looks like DB Schenker is looking more for a platform to manage its partner carriers and tender loads electronically than introducing an innovative business model on the shipper side.

 

Felipe Capella is co-founder of Loadsmart and Chief Product Officer.

4 Ways Truck Drivers Make the Holiday Season Possible

We’ve talked about what would happen without truck drivers, but when someone tells you to thank a truck driver, do you really know what you are thanking them for? All year long truck drivers miss countless family dinners and holidays, drive through horrendous weather and sit in hours of traffic to deliver the goods, oil and supplies we depend on as a country. Every holiday season we travel to see our loved ones, enjoy large meals and unwrap presents- none of which would be possible without the 3.5 million truck drivers who work throughout the holiday season. Check out the statistics below to find out exactly how truck drivers make the holiday season possible.

Food

This Thanksgiving, be thankful for truck drivers. Truck drivers carry the nearly 52 million turkeys that will be consumed this year to your local grocery store. They also carry the 841 million pounds of cranberries, 1.3 billion pounds of green beans, 2.4 billion pounds of sweet potatoes and 1.3 billion pounds of pumpkins you enjoy annually. We’d all have empty tables without truck drivers!

Traveling

The holidays are a time for family. In 2014 nearly 100 million people traveled during the year-end holiday season. This year, 46.9 million people are expected to travel 50 miles or more for Thanksgiving. Together, that’s close to one-half of the entire United States population. Without truck drivers, there would be no gasoline to fuel these trips, dampening holiday cheer across the country.

Gifts

In 2014 Americans spent $620 billion on holiday shopping between November 1 and December 16. Considering that 100% of consumer goods are transported by trucks, it’s realistic to say that they worked overtime to make sure stores had everything you needed for your holiday shopping list. On top of delivering goods to store shelves, they also transport a majority of packages. Those are both the packages you order online, and the packages grandma sends. It’s predicted that the U.S. Postal Service will deliver 15 billion piece of mail and packages during the 2015 holiday season.

Everything Else

It’s no secret that truck drivers are responsible for delivering most everything you buy to get in the holiday spirit. Not only do they stock the shelves, they bring holiday cheer in other ways. For example, did you know trucks deliver the helium used to fill the famous Thanksgiving Day Parade balloons? Or that each year Americans buy 33 million real Christmas trees? At any given time there are over 350 million Christmas trees growing on farms around the country. How are these millions of trees delivered from farm to consumer? Truck drivers, of course.

Truck Drivers Make the Holiday Season

It’s pretty clear that we owe a lot to truck drivers. They make our holiday season something to look forward to all year long. Loadsmart would like to thank the millions of truck drivers that keep our economy going not only during the holidays, but all year long.

Trucking Company Fined and Suspended From L.A and Long beach Ports

Driver Guadalupe Martinez and the trucking company Martinez Trucking and Logistics Inc. will be suspended from the local ports for 10 days, fined $18,000 and the driver will be on probation for three years. This sentence has not their first, less than a month ago they were convicted for another overweight load and permit misuse (a misdemeanor).


For more info go to Press- Telegram Trucking>>

 

22 Days of Christmas Begins with Capitol Christmas Tree Delivered! (Sponsored By Trucking Industry)

As a tribute to the start of our 22 days of Christmas we are making a story about a Christmas Tree one of our top stories of the day. The special Kenworth T8830 delivered the tree, a 75ft white spruce from Montana. The tree made 30 stops and went on a 3 week tour with other fellow trees. The event was sponsored by Truckload Carrier Association, PeopleNert and others. 15664635211_3538b286d7_k

CCJ>>

More Fines for Central Transport by the OSHA

The Occupational Safety and Health Administration has fined Central Transport in the past and will continue to do so if they keep disregarding safety regulations. They have been issued 16 violations including 5 that have been issued before. Just last september they were fined 108k in their Rock Island Terminal and this time the penalties by the OSHA are for 145K.

For information including what the fines were for go to The Trucker>>