How Technology will Affect the LTL Industry in 2019

For business owners, freight shipping can be a laborious affair, especially for smaller business owners that ship in lower volumes via less than truckload. Every business owner has distinctive shipping requirements and hurdles that they will inevitably face. Many of these businessmen would rather leave shipping logistics to the experts so they can focus their energy on the product their business provides.

Every company aims to cut cost while increasing efficiency and when it comes to shipping, business owners are faced with the steadily growing demand from both customers and businesses alike that expect their goods to arrive at a faster pace than ever thought previously possible. Due to these progressing demands over the past decade, the LTL freight industry has been forced to evolve or die by reconsidering how the fulfillment and shipping process can be accomplished.

An answer to the challenges posed by the changing customer expectations and a booming e-commerce market over the past decade, carriers, shippers, and drivers have slowly but surely embraced the integration of new tech into their shipping process. These technological adoptions have improved visibility and transparency, created solutions to common problems, and refined the economy of LTL shipping. Due to this success, freight experts forecast even further technological assimilation in years to come. Below, we will discuss how technological progress within the freight industry will continue to affect the LTL industry in 2019.

E-Commerce and Shipping

Over the last decade, we have witnessed the death of brick and mortar retail and the rapid growth of e-commerce. Consumer habits have changed with e-commerce spending increasing rapidly every single year. This e-commerce boom has forever altered the shape and scope of the LTL freight industry, increasing the need for rapid delivery and optimized inventory management in order to succeed.

With Amazon leading the way and other retail giants such as Walmart scrambling to follow in their footsteps, this movement to online sales is shifting at a rapid pace. Growing online sales will force business to be ever more reliant upon their LTL shipping services.

As more and more companies embrace this e-commerce model and the technological change therein, the demand for LTL shipping will only continue to grow—likely at an exponential rate. This increased demand though comes with greater expectations and competition as more freight carriers seek to enter the market. Because of this, LTL shippers must also embrace the future capabilities provided by technological progress within the freight industry in order to improve accountability, decrease shipping costs, and increase shipping speeds.

The ELD Mandate

One of the most obvious and universal technological advancements is the ELD mandate, which will enter phase 3 in 2019. Originally part of the 2012 congressional bill entitled, “Moving Ahead for Progress in the 21st Century,” the ELD mandate would require the Federal Motor Carrier Safety Administration to require the addition of electronic logging devices (ELDs) in every freight truck as a replacement for paper logging and tracking.  

The goals of this mandate were to:

  • Improve accuracy hours of service.
  • Create a safer and more accountable working environment for drivers.
  • Allow drivers to distribute Records of Duty Status (RODS).
  • Increase the efficiency of managing and tracking.

Now in phase three, which is the “Full Compliance Phase,” Every single trucker will be required to install, register, and utilize an ELD in their truck by the time 2019 rolls along. This technology will positively affect the LTL industry in several ways:

  • Decreases paperwork and time invested in driver reports.
  • Decreases vehicle downtime and increases vehicle utilization.
  • Easier-to-track hours of service.
  • Grants the ability to monitor and analyze driver behavior and efficiency to optimize fuel burning habits.
  • Improves transparency into driver hours and driver speeds.
  • Increase communication between driver and carrier, providing rerouting or more efficient lanes.
  • Increases ease of fulfilling Driver Vehicle Inspection Reports.
  • Prevents drivers from driving longer than they should, thus decreasing accidents that result from exhaustion or sleep deprivation.

While there are various benefits to the addition of the ELD to the LTL industry, there are some drawbacks. Due to the restrictions on driver hours, shipping prices will likely increase since it may require multiple trucks to get the delivery there in the fastest time possible. A driver stuck in traffic for multiple hours will still be required to end their shift after their allotted 11 hours. So, even if a truck is but a few miles away and the driver is over his limit, that delivery will either require a new driver, a truck transfer, or have to wait until the next day for the same driver to finish out the delivery.

Mobile Apps

As the LTL freight industry continues to shift away from old-school paper documentation, mobile developers seek to find solutions for shipping duties that can be done seamlessly from your mobile device. Currently, there are three types of apps that are created for the LTL freight industry, they include:

  • Apps created for the driver
    • Driving and routing directions
    • Social media
    • Truckstop locators
    • Route optimizers
  • Apps created for fleet requirements
    • Shipment tracking
    • Shipment tracking
    • Dispatching
  • Apps that focus on freight
    • Load boards
    • Load matching

The mobile app pool will continue to flourish within the LTL industry as demands for optimization and automation continue to rise. As cloud-based services grow in popularity, experts forecast a surge in apps that utilize cloud-based software. These apps will help to decrease stress, solving headaches before they can fully take hold. Such technologies will provide shippers with the relevant data needed to make smart business decisions when it comes to their LTL freight shipping.

On-demand Trucking Apps

These days it seems as if the whole world is moving into the on-demand space, whether that is for television, movies, taxis, or shopping. It should be little surprise that some visionaries wish to apply this mindset to the LTL freight industry. On-demand trucking will seek to eliminate the middleman freight broker and directly match shippers with carriers. Such technological advancements will:

  • Allows for the ability to locate a driver regardless of the area a shipment is stored, thus decreasing downtime.
  • Eliminate the need to spend hours of time on phone calls, and paper documentation in order to schedule a freight process, thus increasing efficiency.
  • Improves the speed of deliveries.
  • Increases the number of jobs a truck can change, cutting down waste and fuel consumption.
  • Improves driver visibility, allowing shippers to monitor a driver’s movements and view the amount of space available in their cargo bay.

This uberization of the logistics industry is the future as shippers and truckers are directly connected, possibly decreasing the need to pay for a third-party logistics broker. The benefits offered by this technological innovation will cut operational costs, reduce fuel consumption and increase total revenue.

Automated Freight Brokerage

According to Overdrive online, Noel Perry, Truckstop.com’s chief economist and a huge believer in the eventuality of automated driving, had this to say about technological changes coming in the LTL industry:

“The brokerage business will be automated before the trucks will be automated. If you don’t automate, part of your own processes for speed and efficiency, they will kick your butts out of the industry. The power of the technology is so great that if you simply lay back and depend on your experience and relationships, you will fail. It’s [a question of] whether you automate, or they do. You know what has to be built into that technology – you’ll know how to use it to make your relationships, pricing and other expertise all that much better.”

The rise of automated freight brokerage will serve as a technological counterweight to those shippers who do not wish to embrace the on-demand LTL trucking model. As transportation costs continue to rise while delivery windows and capacity constraints narrow, both shippers and carriers will have to embrace technological advances to increase efficiency.

Automated freight brokerages will utilize data and new tech to improve the following areas within the LTL industry:

  • Allows for predictive freight matching where freight brokerages can use real-time and past locations in conjunction with other data to predict capacity availability.
  • Creates freight marketplaces matching loads with available trucks in order to fulfill capacity.
  • Improves the freight payment process by creating seamless electronic payment and invoicing, thus reducing the required documentation, waste, and loss.
  • Increased freight visibility thanks to GPS and telematics systems to eliminate the need for manual check calls to a driver to update load statuses.
  • Provides instant pricing using pricing algorithms that utilize data inputs to provide an accurate and fair transport cost.

Real-Time Shipment Visibility

The technological advancements mentioned above all allow for real-time shipment visibility within the LTL industry. These allow for real-time status updates, including delays, route changes, transfer points, arrival times, and delivery times. Such information is vital as even minor slowdowns can have ripple effects on the entire supply chain.

As such visibility becomes even more integral to an efficient LTL supply chain, the ability to collect data and automatically analyze it will continue to improve and optimize the LTL freight industry. Such collection enables effective automation of every aspect of the freight industry including document retrieval, LTL tracking, carrier selection, shipment tender, and carrier rating. Because of this, companies must prioritize freight visibility to gain a competitive advantage over.

Other reasons why shipment visibility is critical these days include:

  • 3PLs and Brokers believe visibility to be an integral aspect for shipper’s decision on which carrier to provide.
  • Creates transparency and allows businesses the chance to see where investment could help optimize the process.
  • Helps discover new or additional freight hauling opportunities.
  • Increased demand for shipment visibility with more frequent and detailed updates throughout the transportation process.
  • Late shipments can cause massive productivity dips within the supply chain. Increased visibility will cut down surprises and allow shippers to adjust their production line.

Automated Proof of Delivery

Proof of Delivery receipts are an essential aspect of any LTL freight delivery. These help to establish the chain of custody and legally acknowledges that the goods have not only arrived but have arrived undamaged. Automated Proof of Delivery, increases the visibility of the shipment progress and improves delivery workflow.  

Such systems can cut down on friction between customer’s and businesses, allowing for drivers to compile photos, damage notes, and customer signatures all in one place. These attachments automatically sync, which helps to create an open and honest line of communication between a carrier and consignee during damage freight disputes.

Conclusion

As the world continues to spur technological innovation, it is essential for LTL shippers, carriers, and brokers to not only embrace but adopt these solutions in their supply chains and shipping processes. Such technological advancement will serve to optimize LTL shipping, cutting costs, improving supply chain efficiency and increasing shipment visibility. The data provided by this new freight tech will provide valuable information that can be acted upon to make smart and economical decisions in response to further trends. As is so often the case, those who refuse to implement these technological progressions within the LTL industry will wind up going the way of the dinosaurs.

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