BIRMINGHAM, AL. McLeod has been embedding freight matching in its base product for over five years. That work is starting to pay off for the company and its customers this year. While other “digital brokers” say they invented the concept, McLeod credits its customers as the pioneers in driving efficiency in brokerage operations.
“Obviously you’ve got to have critical mass,” Tom McLeod, the CEO and president of McLeod Software, said during the 2018 McLeod Software User Conference at the Birmingham-Jefferson Conference Center. He noted that digital freight matching is something that has been running in the background of the company’s software for years. “We’re just now starting to see adoption take off.”
Digital freight matching is more than just finding the carrier/truck for a load; it must also involve pricing the freight correctly, including how you help your people do that, he said.
The McLeod Exchange is a private, interactive marketplace, available only to carriers and brokers running McLeod systems. The McLeod Exchange gives brokers the opportunity to post loads only visible to other McLeod carrier customers. McLeod executives say their customers report that the McLeod Exchange’s timeliness and accuracy is greater than the public load boards, giving McLeod customers a leg up and an opportunity to know that they are dealing with other reputable, stable companies.
“It’s typical for the freight brokers to be much better at negotiating (price) than the trucking companies,” McLeod said. “Freight brokers are just a sales organization. That’s just what they do. At the trucking company, you’re looking for an efficiency expert. Somebody that’s good with the drivers, good at those conversations and good at planning and has skills to keep the truck moving. He can get out-verbalized by the broker every time.”
“So giving people in the trucking operations better information to make better decisions really helps to bring them up and make them better players and participants in that kind of scenario,” McLeod said.
McLeod said his company does expect to see more automation of the communication information, allowing the carrier to tie in with McLeod’s private network. That can be “utilized to create better, more automated communication with their business partners” -- the freight brokers.
This summer, McLeod Software introduced McLeod Capacity Creator, and this week, it introduced the McLeod Anywhere Carrier Mobile App and unveiled its new Integrated Carrier Search and Waterfall Tendering capabilities, which will be released soon.
According to McLeod, successful digital freight matching has many aspects:
- Gain and maintain an understanding of the carriers you work with: The best way to do this is by understanding each carrier’s lane preferences and their past performance. Then someone needs to work on each carrier relationship with an understanding of those things and ensure the company is consistently taking proactive, not just load transaction reactive steps to build that relationship and understanding. McLeod customers do this using its Carrier Scorecard, Carrier Lane Preferences & Carrier Relationship Management capabilities in the system.
- Offer the right freight to the carriers you know: Once you gain an understanding of each carrier, where they want to go, how their network functions, and the types of freight they are consistently looking for, it is imperative to target them by offering loads that match those preferences and to do so on a consistent basis. You must also do it efficiently for the tactic to be effective. McLeod customers use our Private Notification Network (PNN), Integrated Carrier Search, Waterfall Tendering, Find Near, and Continuous Moves functions to accomplish this.
- Keep them moving if you can: One of the easiest ways to get or sustain your available carrier capacity is by keeping the carriers that you currently have moving loads supplied with their next load. This aspect of digital freight matching implies you can identify and offer that right “next load” to the carrier who is already slated to pick up a load you dispatched or is already underway on a load you supplied. McLeod customers accomplish this with our Continuous Moves, a new McLeod Carrier Mobile App offers, and the “Find Near” functions in our system.
- Find the next available tractors before anybody else does, and not just from the load boards: Most brokers and 3PLs are bombarded daily from carriers with lots of free-form information in emails about available tractors. The problem is that it takes substantial labor and time to sort this free-form information and identify capacity that is still available to book. Many simply don’t bother, and others spend inordinate amounts of labor searching these emails, often to find they were too late and somebody has already booked the truck. Our customers can use the new McLeod Capacity Creator to sort all of these emails, identify the available tractors, and match them with the orders already in their system, all with an automated process.
The understanding of current market conditions and history on a given lane is critical to not leaving money on the table, McLeod says. Furthermore, brokers and 3PLs need to give their people guidance on how to price freight both to the shipper and when offering it to carriers or even negotiating with carriers.
McLeod customers use the system’s Target and Max Pay functions to supply this guidance as part of the freight booking process. They have access to recent history and rate information through the integral McLeod Market Insight pricing in their system, their company history in that lane, plus the DAT and Internet Truckstop information if they are subscribers. All of this recent rate history is instantly displayed at the right place, and at the right time, in their McLeod system, at the point of decision where it matters.