Amazon and much smaller digital start-ups have announced plans to make freight brokerage a largely automated service. These companies will rely on software to broker dry van freight loads across the country. But, while Amazon’s presence certainly demands attention, the concept of automating the freight brokering and shipping process is not new.
For years, segments of the transportation industry have relied on transportation management system (TMS) software for routing, tracking and tracing, routing guide creation, and reporting – from one computer or mobile device screen. The technology also aids shippers in finding freight capacity among carriers and brokers with real time tenders, bidding, and load execution. But such automated processes can backfire, especially when dealing with more complex freight, like dry and bulk liquid shipments.
Disadvantages of TMS software for finding freight capacity
The downsides to TMS for sourcing capacity are related to shortcomings of the software itself, as well as the human input required.
1. Load information is often incomplete or inaccurate. When this happens, carriers are accepting loads under false pretenses that could lead to major headaches for all involved. A few examples:
- Customers/shippers sometimes use cookie-cutter language when communicating information about a given load. Example: a carrier recently accepted a load through a TMS that called for “standard equipment” for delivery to a rail yard. Upon arrival, however, the carrier was presented with a facilities access agreement that no one in their right mind would sign. This created contentious back and forth between all parties before the customer ultimately resolved the issue. The headaches – and wasted driver time – could have been avoided had the shipper adequately described the situation (though, if they had, the carrier would never have accepted the load).
- Many liquid bulk carriers won’t touch a load that requires more than 100 feet of hose. One such carrier recently accepted a ‘standard equipment’ run which ultimately required 160 feet of hose – a detail they didn’t learn until arrival at the delivery site, where they suddenly found themselves underequipped. Is 160 feet of hose “standard equipment?’ Not in the minds of any carrier we know. This is just one of example of the difficulty associated with automating bulk freight transportation. It’s such a complex type of transport that 1-on-1 interaction remains the most efficient way to handle it.
- Safety data sheets (SDS) are essential for handling chemical freight. They’re also regularly left out of the load information within a TMS. If a carrier doesn’t do his or her homework and secure one ahead of time from the customer, payment squabbles are a likely result when the job is complete. Tank washes are usually the culprit as they can become a very expensive (e.g., $600 to wash a tank after carrying certain polymers) surprise for the carrier.
2. Rate changes may not be invoiced accurately. Speaking of payment squabbles, they regularly result when agents on the TMS side secure a load manually. It looks like this: a routing guide with a set rate will make the automated rounds from carrier to carrier. If none of the carriers accept the offer, an agent with the TMS provider will contact carriers directly to try to secure the load with a spot rate. When the agent is successful, the job will be completed as agreed. When it’s time for payment, however, the carrier will often be paid at the original rate instead of the spot rate. The unhappy carrier must then chase down the balance from the annoyed shipper directly.
3. Scheduling is inflexible. Within the TMS software, carriers can either say “yes” or “no” to a load offer. There’s no opportunity for, “well, I can’t deliver it Monday, but I can Wednesday” or other key follow-up communication. Because of this, shippers are unaware of alternate options and related benefits that could be more efficient and/or cost-effective.
Relationships matter when finding freight capacity
TMS software is a convenient means of securing capacity, but it’s not your only option. Freight brokers such as Bulk Connection have their own substantial networks of carriers that they can gladly tap into on your behalf to find the capacity you need.
These brokers often have long-term relationships with their carriers and understand their lanes and capabilities, so they can work with you to tailor your load into one that is going to be attractive to the carriers equipped to handle it. To learn more about finding freight capacity through Bulk Connection, contact us today.