Transparency18 sponsored article
Today’s tools and approaches for managing contract freight are broken. Tremendous efforts are expended on annual RFPs and multi-round negotiations, only to yield non-binding agreements that neither shippers nor carriers can reliably plan around. The industry estimates it spends $90bn in manual, tactical effort – phone calls, faxes, emails – to operationally secure loaded miles for carriers and guaranteed service for shippers. But even after the putting 5 million workers against this problem, up to 25% of road miles are driven empty, wasting hours of service and pushing driver turnover to unprecedented levels.
Take the case of US truckload transportation, a fragmented $800bn industry with tens of thousands of shippers, over 300k trucking providers and more than 15k brokers and third-party providers. The lack of hard commitments at the end of annual RFPs negotiations leaves sellers unable to plan effectively or build sustainable efficiencies. This waste is significantly reduced through commitments carriers and shippers can plan around, lowering costs for buyers and shoring up margins for providers.
LogisticsExchange’s (LE) digital platform allows buyers and sellers to execute binding, enforceable contracts. Automated opportunity analytics allow members to quickly identify the best fits in their portfolio for digital LE Forwards contracts. Proprietary matching and rating algorithms ensure buyers and sellers align on critical service and performance requirements. Smart, standardized contracts and active monitoring through execution ensure contractual obligations are honored. And if either counterparty’s needs change, LE’s trading platform provides the liquidity to close out positions.
Early results from LE’s work with a select set of large shippers, carriers and 3PLs have been promising. Over $3bn in annual shipments from blue-chip companies have been processed — identifying over 350 thousand contracting opportunities. Since the company’s beta platform launch, LE has offered over 15k contracting opportunities to buyers and sellers. Benefits include increased driver utilization and higher margins for carriers as well as improved service and cost performance for shippers.
“As we begin execute additional binding contracts, we are refining the microservices that power our platform, tuning our algorithms for processing large datasets, and automating the identification and execution of contracting opportunities,” said Anshu Prasad, Co-founder and CEO of LogisticsExchange.
LE is presenting a demo at Trasparency18 in Atlanta, on May 22, if you want to find out more about the product, the team would love to answer your questions in person.
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