Truckers move the world. Nearly every product in the United States is transported in a truck at some point in the logistics stage. Yet, despite the advances in technology and artificial intelligence, truckers and small carriers are stuck using legacy and outdated methods to run their business.
The transactional road block
One of the biggest problems drivers face today is the transactional nature of the spot market business. Spot market as a whole is growing rapidly, with record-breaking rates in August. That’s definitely good news for drivers.
But, the industry’s biggest roadblock lies with its greatest asset—the relationships between people. There are more than 18,000 freight brokers in the United States, according to the Journal of Commerce. In order for drivers to book their next load, they must maintain a relationship with multiple brokers. This brings two major challenges:
● It’s nearly impossible to calculate the best load with only a handful of broker relationships.
● Truckers live with an ongoing uncertainty of where their next load (aka paycheck) will come from.
Owner operators and small carriers work hard to expand their network of brokers, but at the end of the day, it’s unrealistic for them to sift through all the available loads and determine the most profitable one.
If this is challenging for seasoned truckers, imagine this for new drivers trying to jump start their career.
A race to change the future
This is where technology can help bridge the divide. The very purpose of artificial intelligence (AI) and automation is to help people collect, decipher and understand data points at scale. And, in the logistics industry, there’s a mountain of data to work with.
Let’s start with the first challenge—determining the best loads. Traditionally, carriers and owner operators begin their load search with relationships. They contact their brokers to get details on the best paying loads at that very moment. Once they have all of the information, carriers spend additional time deciding which loads have the best options for the destination they want to reach. This is critical because their final destination might not have a profitable shipment waiting for them when they arrive.
New drivers have another uphill battle—developing relationships with the right brokers to ensure they’re getting the best rate per mile.
It’s precisely why all truckers live with an ongoing sense of uncertainty (the second challenge).
With the right implementation of AI, drivers can strategically plan their routes. Not only will technology help carriers collect and identify the best paying loads from brokers, but it can also surface and prioritize this information based on desired destinations. It can also help map out shipments that offer drivers more money and suggest the next city based on their preferences.
Analyzing or processing loads at scale levels the playing field for new drivers entering the market with little to no relationships. It also cuts down on the time veterans spend on reviewing and analyzing the best loads.
Using strategy to drive the industry
One of the biggest benefits of AI-enhanced solutions is that it shifts the entire industry from a transactional, load-by-load mindset to a strategic, profitability driven mentality.
Small carriers and owner operators often feel like they can’t make a dent to their top and bottom-line costs. The good news is that this is where tech can help.
The right technology can help identify changes in the market that could benefit the entire operation. Spotting these changes and getting to outliers (loads that are paying higher than average) can highly increase your profits. To manually do this, someone would have to stay hooked to a load board for hours until they see something popping up. Obviously, this is impossible for an owner-operator.
AI also helps assess an industry full of variables within seconds and come up with a strategic recommendation. This capability to analyze the entire market, understand how and when the market will shift, and in what direction is critical to plan a great strategy. It’s nearly impossible for an owner-operator to do this type of market analysis because there simply isn’t enough time for them to plan. But, knowing where to send trucks can be the difference between a profitable business and a truck that gets stuck losing money.
Lastly, technology can help carriers digitize their entire back office. This frees up time from tedious paperwork and filing to truly plan out their lanes and week ahead.
This year brought tremendous change for everyone, forcing people to work from home and companies to transform digitally. It’s time for the trucking industry to benefit from this wave of innovation as well. Whether it’s to maximize business profits or to be more digitally connected to the next generation of drivers, there’s much excitement about the possibilities technology offers.