XPO Connect has a chance to make a statement for incumbent logistics providers in the digital marketplace

XPO Logistics, a $15 billion logistics company, announced they are releasing a new digital platform that shippers can use to manage their shipments. It will allow the shipper to track, trace, request quote, and manage the amount of spend they have with the logistics provider. Having access to the resources to develop tools without needing to raise capital should be a significant advantage in the digital transportation segment to the logistics provider.

The push for visibility in freight networks is nothing new, but it does appear that many carriers are starting to take the move to digital transparency more seriously. The buzz surrounding digital brokers like Convoy, Project44, and Truckstop.com has put more pressure on the incumbents in the industry to continue developing interactive tools for their customers.

XPO is somewhat unique in the way they have a large fleet with over 7,000 owned trucks and operate as a 3PL with access to several carriers utilizing multiple modes of transport. The blend of asset and brokerage makes it difficult to have visibility throughout the network. XPO offers a wide variety of transportation services such as intermodal and final mile delivery. XPO Connect is supposed to offer a consolidated portal for shippers who utilize XPO’s services.

According to a company spokesperson XPO has other technology driven tools such as their Freight Optimizer that “matches trucks to loads by leveraging machine learning.” XPO’s other customer interfacing technology includes their Rail Optimizer and the mobile Drive XPO app. XPO Connect is “designed to integrate all modes of transportation,” stating that this will build on the existing technology providing more convenience to its customers.  

When asked to explain more detail on what level of visibility the customer will receive, “XPO Connect gives visibility across modes in real time.” This statement implies a level of transparency that is rarely seen in transportation today, especially when dealing with multiple modes of transport. It is unclear as to how this is achieved as they would not get into gross detail. You could assume ELDs and GPS enabled technologies have made implementing this a bit less challenging.

The level of success XPO has with Connect will be telling. XPO operates as both 3PL and asset carrier, so they should be able to combine aspects of both perspectives.  The advantage an asset-based transportation company has over a purely digital broker is they can provide an immediate and specific service tied to their product. The customer has a tangible history with the carrier as a point of reference. The limitation of the asset-based carrier digital app is the customer will only see the view the carrier is able to show you within its own space. Many transportation managers want to diversify their carrier base so one portal from a single carrier may not be as good as a 3PL’s digital interface. With XPO being a hybrid of asset and 3PL they should have a big advantage.

If you have been reading FreightWaves you will know the digital revolution in transportation has not made its way to the mobile user yet. Very few carriers report utilizing the various freight matching apps as the main source of finding loads. XPO Connect has an opportunity to show the digital brokers what the incumbents can do.

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