“It’s just another day in the freight management world.” No one ever says this, because each day brings new challenges and opportunities to expand operations, meet higher freight demand, and secure healthier profit margins. However, gaining access to the data and knowledge needed to position a company for the most remarkable growth is not a small feat. For carriers, shippers, brokers and 3PLs, finding a successful future and applying freight data imply a need for more freight optimization. That leads to a need to reconsider contracts, begin new freight bidding processes, and conduct trucking route and performance analyses. As reported by Logistics Viewpoints, “Bid optimization and procurement are truly foundational for companies to achieve supply chain excellence and drive value. Procurement process and bid activities have a significant impact on shippers and carriers, making it critical for companies to establish good sourcing practices.” Freight management parties seeking optimization need to realize the truth about how data and trucking route analyses go hand in hand with optimization, growth and continuous improvement.
Why trucking route analyses cause anxiety in shippers, brokers and carriers
Data-driven decision-making is excellent, but it leaves an impression of countless hours of pouring through logs to analyze data that yields a desired outcome in securing or selling trucking capacity at a favorable market rate. Today’s freight management parties, ranging from shippers through 3PLs, have the advantage of using technology to aggregate data across millions of points, analyze data in real-time, and apply those insights through advanced systems. An application programming interface (API), like SONAR Signals Open API, may connect data directly into the user’s existing tech stack to take decision-making to the next level through automation, such as what Kingsgate Logistics is doing when ingesting FreightWaves SONAR data via API. All these processes take time and attention to detail. And that’s where the crux of efficiency lies; freight management parties have a perception that getting access to data is confusing at best and a harbinger of immense overhead expense. But, in reality, that perception is no longer correct.
How freight forecasting uses technology and the IoT to reduce confusion in data management
It’s easy to understand why freight companies worry about the complexity of data management. It’s thousands of acronyms, charts galore, and an endless supply of information that adds up to freight market intelligence. Simultaneously, the advancements in freight analytics have given rise to a new form of freight forecasting that can overcome the obstacles to applying data and drive meaningful insights and actions.
For example, using technology to manage trucking route analyses will help companies recognize the most lucrative lanes and loads. That means additional opportunities to secure the coveted “of-choice” status among shippers and carriers. When shippers and carriers see and respond to market fluctuations, they are more likely to offer reasonable freight rates and take extra care to ensure trucks arrive and leave the yard on time. Those improvements build better relationships with freight management parties – contributing to the overall success of the industry. There are other concerns that technology may get in the way. In reality, it’s knowing how to apply these resources to find the key freight metrics and insights to help companies tap new lanes, carriers and other partnership opportunities. And that allows companies to understand and intervene in trucking route decisions – from bidding through management – to maximize profitability. Let’s take a look at how freight market participants are using FreightWaves SONAR to get easier access to actionable insights derived from automated analyses of freight market data.
Tips for applying data to understand trucking routes insights and renew bidding strategies strategically
Let’s get one thing clear. There are thousands of possible indices that can drill down into every location, equipment type, carrier and more within FreightWaves SONAR. With that in mind, freight management parties need to find the indices most valuable, such as the HeadHaul Index (HAUL), a good indicator of capacity changes; the Outbound and Inbound Tender Rejection Indices (OTRI) and (ITRI), which are indicators of carrier activity; or the DHL Supply Chain Pricing Power Index (DHLPPI) for brokers and carriers, a high-level view of who holds the power in negotiating spot market rates and contract rate rebids. Shippers need to think about the Outbound and Inbound Total Lead Time Indices (OTLT/ITLT). 3PLs may apply a mix of both. And still, any user may wish to review the composite Logistics Managers’ Index (LMI), a direct survey insight into transportation and logistics conditions. What indices are employed is up to each user based on need. What is most important is that the information can be used to look beyond individual lanes to find the gems of savings across supply chain relationships. SONAR’s Lane Signal is a lane-by-lane freight rate forecasting app showing past, present and future rates, pricing power scores and a visual comparison of markets that impact your business. Lane Score data provide a good indication of how difficult a lane is to cover or secure, and that data can be compiled when attempting to kick-start a new bidding process. Of course, it’s always nice to have a few universal best practices in mind.
- Let freight forecasting engines, like SONAR, do the heavy lifting.
- Keep mini-bidding processes on the table regardless of projections.
- Measure OTRI and ITRI across key lanes.
- Stay close to your core partnership – but be willing to open new relationships.
- Take advantage of resources to use freight forecasting platforms more easily.
Get in the know with SONAR for better trucking route analyses
Improved trucking route analyses mean looking beyond lane-specific data and understanding that both lane views and whole-market views are critical to making an informed decision. All supply chain data amounts to movements, so looking at the whole picture is the only way forward to maintain contracts, create new RFPs, or sit through a spiel on why a mini-bid can help secure more capacity. Now is the time to act. Connect with FreightWaves SONAR online to request a demo of how SONAR can turn your operation into a data-driven, insightful logistics empire.