Published on Aug 30, 2019
Updated on Nov 6, 2019
Governments are keen on introducing high capacity vehicles (HCV) to limit traffic congestion and reduce carbon footprints through freight transportation. But, truckers struggle with finding their next load on the backhaul and, of course, want to clear payments as fast as possible.
E-commerce has brought about a 5% increase in urban shipment demand. But, the situation is- retailers complain of goods not reaching the customer in time because of trucker shortage. And transporters claim- they suffer significant losses due to deadhead miles. Ironically, the load trucks are rolling, but without loads or lesser goads than their capacity, which leads to the transporter’s loss.
This article highlights how freight automation can maximize load bookings to bring a favourable impact on the transportation and logistics industry.
Logistics & Transport Service Challenges
The traditional shipping process involves contacting third party brokers and vetting the shipper manually. Despite being at the core of the supply chain, transportation services lack innovations to improve operational efficiency. The following are some crucial challenges that the logistics industry faces, even today!
Deadhead Miles
The trucks operating without load contribute to dead miles. Dead miles can occur when a carrier travels from location A to location B to pick items or it returns empty from location C to location A after dispatching the load.
According to the American Transportation Research Institute (ATRI) survey report 2017, it costs $66.65 per hour to operate a truck.
Traditionally, small trucking companies call freight brokers, who in turn call up warehouses to find if there’s freight ready for hauling. Unfortunately, about 15%-25% of the time, truckers end up carrying zero freight.
Therefore, deadhead miles certainly bring a huge loss, especially because freight services generally operate interstate.
Lack of Price Transparency
The transportation sector has been struggling with inflexible prices and backhaul charges. Fleet operators often demand deadhead miles charges for the shipment. Thus, irrespective of cargo capacity (or the volume to it’s full), the operator can charge sellers any amount.
Trucker Shortage
Trucking companies have reported truck driver shortage as their top industry issue in 2017-18. The American Trucking Associations state- the industry needs to recruit and train 898,000 new truckers by 2026.
Manual Booking
On average, a logistics company may waste 4000 to 6000+ hours to manually create bookings via phone calls, emails, and coordinating with drivers and manufacturers.
Benefits of Freight Automation
Transportation-as-a-Service (TaaS) can bring manufacturers/sellers, shippers, and carriers on a common platform. Automation solutions can bring the following benefits-
Route Matching and Optimization
Traditional backhauls include unused available capacity, causing deadhead mileage.
With route matching feature of a freight automation system, instead of travelling back and forth from location A to location B, and then starting a new haul from location A to location C; trucker can find the best route to reach location C enroute.
Efficiently Managing Fleet Operations
Traditionally, equipment tracking was dependent on manual data entry from drivers, shippers, and consignees. The process was not only cumbersome but also error-prone. Transportation supply chain automation helps in managing fleet operations in the following ways-
- Lodging truckers’ start and end time automatically add to the accuracy of HOS (Hours of Service) records.
- Vehicle tracking can identify bottlenecks and provide instant support in case of accidents, fuel shortage, roadblocks, or other unanticipated highway incidents.
- Route guidance enables efficient haul plans.
- It can reduce idling time and thus improve fleet productivity.
Transparent Pricing
Transparency in pricing can make freight transport robust and reliable.
For instance, Uber Freight has introduced Lane Explorer, which shows real-time market-based rates, up to two weeks in advance.
Online Processes
In any logistics and transport organization, the manual payment cycle requires 40%-60% more time and effort than its automation counterpart. Freight bill automation can solve the heavy-haul truckers’ problem of receiving payments faster. Eliminating manual processes can improve overall supply chain efficiency.
Collaboration Between Fleet Brokers
OECD states– Truck platooning can save over 10% in operational costs. Platooning is driving a group of vehicles together to increase road capacity via an automated highway system.
At the same time, HCVs (High Capacity Vehicles) that carry 50% more load than traditional trucks can save up to 20% cost/km.
However, truck platooning and utilizing complete HCVs capacity requires collaboration between shippers, carriers, and freight brokers. Automation can bring different stakeholders from the freight and logistics industry on a common platform to work together.
Product Spotlight
HwyHaul, a leading California-based freight brokerage startup uses transportation automation to connect enterprises with truckers. It simplifies the ‘load booking’ process for shippers and seamlessly empowers them with a state of the art Transportation as a Service (TaaS) solution.
Currently serving Reefer, Dry Van, and Flatbed loads, HwyHaul connects shippers and carriers on a common platform. The distinct features that freight-logistics management platform brings are-
- Shipping enterprises can create and track their freight from booking to end-of-delivery.
- Trucking companies (carriers) can manage their fleet and drivers.
- Internal operations team can oversee and govern backend processes.
- Truckers can use HwyHaul app to book and deliver loads without having to wait for telephonic communication.
We specialize in developing industry-specific and logistics & freight automation products. Contact us at hello@mantralabsglobal.com to learn more.
Bottom Line
Load bookings and freight brokerage automation solutions can contribute to reducing carbon footprint and improve fleet productivity to a great extent.
PwC 2019 report says by 2030, automation will shorten delivery lead times by 40% and reduce logistics costs for standardized transport by 47%. With newer disruptions like driverless trucks, relay-as-a-service model and automatic freight scheduling on the horizon, the transportation and logistics industry is on the cusp of unlocking new revenues across the value chain.
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