Uber Freight, a division of Uber Technologies (NYSE: UBER), has rolled out a free rate-locking tool in its shipper platform as small and midsize businesses attract more attention from digital brokerages.
“Uber Freight has always been focused on bringing digital freight technology to carriers and shippers of all sizes,” Michael Bailey, the product manager leading Uber Freight’s shipper platform, told FreightWaves in an email.
But small and midsize shippers have been traditionally underserved by technology, he noted, and often lack a full team and staff to manage day-to-day logistics operations.
The self-service tool will be available in Uber Freight’s shipper platform, and although it is available to all shippers, it is specifically designed to save time and money for the smaller category.
Generally speaking, if a shipper wants to move a load on a lane, it has two options: secure coverage on the spot market or spend hours, if not days, negotiating with traditional brokers and carriers to get a short-term contract.
The rate lock offering provides instant pricing on recurring lanes and allows secure priority coverage with Uber Freight ahead of tight markets. With the ability to instantly lock in rates, shippers can avoid much of the manual work in the contract process and quickly secure a rate on the lanes they use most, Bailey explained.
Rate-locking commitments are designed to be flexible, the company said, ranging from weekly commitments of four to 12 weeks and monthly commitments of two to three months. Volume commitment ranges from a single shipment per week or month to 15 per week or 60 per month maximum.
Volatility in the market has surged in the wake of the pandemic, and price predictability is a key way for shippers to help ensure consistent operations and reduce uncertainty.
“Currently, securing both short-term contract rates and long-term contracts is a time-consuming, manual process that often requires a pricing team,” Bailey explained, “making it challenging for smaller shippers with fewer resources to lock in competitive rates.”
Another benefit of locked-in shipping rates is more consistent and stable prices for end customers, he observed. “That means better customer service and a more efficient market end to end.”
The rate lock also helps Uber Freight — by bringing additional balance to the market, Bailey said, with shippers committing volume to specific lanes at a locked-in rate.
Release of the shipper tool comes as freight brokerages are releasing more software tools for small and midsize customers.
Just last week Transfix released a transportation management system (TMS) for small and midsize shippers, following a TMS for small carriers launched in October.