The world of freight management continues to evolve, but the systems that help individual companies prioritize needs and keep freight spend under control may quickly become outdated. At the same time, the traditional belief in a spot versus contract market is starting to fall as the industry realizes that the market rate – based on the fact that freight is bought and paid for on spot – is the only thing that really matters. For that reason, freight market participants need an advantage and a way to understand the market. And a market freight rate data tool is the solution. However, there are multiple tools available that all apply some form of big data; not all can compare a large volume of data and create meaningful, actionable insights. To help select the right tool, freight leaders should follow these tips.
1. Recognize the limits of public data sources
The first issue in finding a proper freight rate tool is considering the ability of the tool to access public data. Obviously, most carriers make rates public, but not all are necessarily easy to find. Remember that most fleets contain fewer than five trucks and are owner-operator businesses. Looking at a broad measure of the market on a public, free resource is likely overlooking these key opportunities to source capacity and freight.
2. Consider the timeliness of data collected
Another issue to consider goes back to the timeliness of data. Any data can provide trends and insights, but how old is that data? If it doesn’t reflect recent and long-term conditions, it will be inaccurate. Freight predictions may skew in totally different directions. Isolating market deviations will be difficult at best. Most importantly, making decisions on outdated data is worse than making decisions without data in the first place.
3. Think about the industry experience and brand power of the tool’s developer
Choosing the right freight market rate tool should also include reviewing the experience and brand power of the tool’s builders. As explained by Supply Chain Management Review, “When you ask about their experience, listen closely to the answers. For instance, if you want to make an electronic product, can the representative speak to electronic sourcing? You need to be sure they have sound knowledge and experience. Additionally, find out what brands they have worked with and on what initiatives. If they share recognizable brands, it could be indicative of the manufacturer’s reliability and potential to understand the global landscape. Always ask for references and take the time to contact them.”
4. Think beyond a single mode or filter
Looking further than a single mode is essential to gauge the market as a whole and in specific regions. Above all, an effective market rate tool must have the capability to pull data from air cargo sources, freight brokers and third-party logistics providers, financial conditions institutions?, forwarders, maritime resources, rail and intermodal transportation, and shippers. Additionally, customizable filters, multiple menu choices, and customizable dashboards are other factors to consider in choosing the right tool. Users should also consider their unique needs and time constraints for reviewing data, taking advantage of visualization capabilities, such as the Lane Scorecard as well as Lane Signal, to easily see the status for a given market view.
5. Review the reporting functions of freight data tools
While the freight rate market data tool can present data quickly, it’s imperative to consider its reporting capabilities. Not all users have the time and resources to review endless dashboards. Therefore, it is key to choose a tool that can integrate with the existing tech stack, leveraging an API to reduce clicks, and offering a user-friendly interface. These functions add up to streamlined reporting and faster insights to make informed decisions.
6. Choose a tool that’s undergoing continuous evaluation and improvement
The final tip may seem odd. Look for a tool that has already proven itself in the market and is still under development. Yes, the best freight rate tools will always be under development to bring in the latest data, consider new-found changes within the freight market, and continuously work more efficiently. That’s the ultimate defining factor in choosing a best-of-breed freight rate data engine.
Choose the right freight rate tool by choosing FreightWaves’ SONAR
The right freight rate tool is intuitive. It’s designed for an industry that never sleeps, and it always considers the past, present and future of freight management. Start applying the above listed tips to find that solution. But let us save you the trouble. FreightWaves SONAR is that solution, offering the benefits associated with each tip listed above. Request a SONAR demo online to learn more now.