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Introduction
1. Internet-Based Technology
No broker-leveraged load matching exchange exists.
Within five years of deregulation, brokers were beginning to use computers to make their work more efficient. By the early 1990s, the fax revolutionized the speed with which freight movement transactions could be handled.
By the mid-1990s, the Internet had entered the vocabulary of brokers. At a convention of the Transportation Brokers Conference of America, The Internet Truckstop was introduced. Scott Moscrip asked brokers to believe that he could match trucks with loads in cyberspace. But he added that he had no trucks and no loads at the time.
TBCA-member brokers saw the vision, supported the effort and the first online load matching service was born. As of February 19, 2001, over 27,700 companies have signed up for the web-based Internet Truckstop, and the market is full of competition. There are now over 125 transportation exchanges, each offering a slightly different take on matching freight loads to capacity.
By 1998, logistics firms with vision realized that generic load matching could be customized. One of the pioneers in this effort was Next Generation Logistics who developed NEXTStop™ Internet truck and load posting service exclusively for the food service industry. Only food-carrying trucking equipment is featured in this exchange, excluding flatbed, heavy haul and other types of carriage inappropriate for hauling food.
No broker-leveraged load matching exchange exists.
2. Dotcoms Enter the Picture
To keep and expand the business they have, brokers must go digital using tools available to dotcoms but adding their own expertise.
Transportation service is undergoing rapid transformation. The emergence of e-commerce has created tremendous opportunity that dotcoms are now attempting to harness. This business is already spoken for. Brokers now have it. But that may not last for long.
Dotcoms see broker business as theirs for the taking. Numerous approaches to disintermediation have been made. Most of them are based on trying to REPLACE human interaction with electronic interaction.
The Wharton School of Business has been working on a survey of brokers that some expect may result in a new web-based product for brokers. Wharton has survey knowledge and dotcom knowledge. They DO NOT have transportation knowledge.
To keep and expand the business they have, brokers must go digital using tools available to dotcoms but adding their own expertise.
3. Transactions Eating Professional Time
If brokers could find a way to speed the normal transactions and have them take place in a faster, more efficient manner, each dispatcher could handle far more transactions.
A side effect of the move to technology is that dispatchers spend a great amount of time actually creating the communication that maintains the relationship. Being required to input their own information, dispatchers use up precious time on the job running the technology.
The best use of transportation professionals is handling the difficult jobs, taking care of the snags that come along. They must be able to move swiftly into urgent mode, calling into play their contacts, resources and problem-solving abilities.
Dispatchers are constantly torn between the need to attend to the important (paper work, P.O.D.s, verifications, etc.) and the urgent (loads that need help).
If brokers could find a way to speed the normal transactions and have them take place in a faster, more efficient manner, each dispatcher could handle far more transactions.
4. New Economy Demands Collaboration
Collaboration is the answer.
Wall Street analysts have told members of the Transportation Intermediaries Association (TIA) that the answer is consolidation - merging and acquiring firms to expand service capabilities and achieve economics of scale in a highly fragmented market. They said that small and medium size firms will be bought up. That has not happened at even a small percentage of the predictions they made.
They may have underestimated the entrepreneurial spirit of brokers. We have made it on our own. We don't want to work for someone else. We want to remain independent. Yet the demands of the marketplace in terms of technology are beyond the financial and resource capabilities of most individual brokerages.
Collaboration is the answer.
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