The rising popularity of e-commerce in recent years has totally changed the freight industry. Shipments have become smaller while their number has grown immensely. Many shipments aren’t enough for a full truckload (FTL), so more and more retailers are relying on less than truckload – or less than load (LTL) – shipments to get products to their destinations.
With the growing demand for LTL shipment, the necessity of optimizing and automating is also growing. Technology has long been a natural partner for major LTL carriers like FedEx, DHL, and XPO Logistics, helping them manage transportation processes along the whole supply chain, from fleet management to report generation and communication between all parties.
To successfully rival market leaders, you should think about automating your transportation processes too. In this article, we discuss how technology can help you fight the most common problems of the LTL freight industry.
Why technologies are a lifeline for today’s LTL industry
Automation of transport logistics can significantly benefit shippers and carriers, and several related apps can work together to streamline freight operations. Below, we list the most common challenges LTL shipping companies face and suggest technologies to overcome them.
Challenge #1 Long wait times
In FTL shipping, cargo is transported directly to the destination. In LTL shipping, freight handling and consolidation happens in a hub-and-spoke network. Carrier operations are managed at an end-of-the-line terminal and hub. From the terminal, a truck with shipments ride to a hub where the shipment are unloaded, sorted, and consolidated with other shipments. After that, the truck goes to the destination city.
Shipments are kept in the hub until other shipments going in the same direction arrive. So the delivery time grows significantly, making LTL shipping a bad solution in terms of shipping time. Inefficient planning is one of the reasons for this increase in time.
Difficulties planning shipments and forecasting orders, in turn, mainly stem from poor communication among shippers, consignees, and carriers, poor data synchronization between systems, and the use of old information. If planning is done manually, this will complicate the whole process and often result in wasted time and resources as well as lost profit.
A transportation management system (TMS) with shipment planning functionality can facilitate logistics by automatically turning orders into shipments and determining the most suitable truck for their transportation.
TMS system should have a shipment database that includes information on planned and actual shipments, the orders they contain, when and how those orders were shipped, what vehicles were used to transport them, and the individual products in those orders. If you keep all this data in a CSV file, you can implement a convenient CSV reader.
Challenge #2 Inadequate rates
One of the main benefits of LTL shipments in comparison with truckload shipments is the lower price for transportation. But another side of the coin is that calculating rates may be hard due to the long list of factors affecting the price.
The shipping calculator in the shipping marketplace uShip has an intuitive and clear interface that allows you to quickly calculate costs. This price calculator serves mainly for customers, but creating something similar for a TMS technology is a must.
Challenge #3 Lack of visibility
Lack of inbound freight visibility is a root of significant problems in supply chain management. Shippers may not know when a delivery will arrive, where a truck is at the moment, and how much labor will be required to unload the freight within a given amount of time.
To solve this problem, during logistics management software development, you should add fleet management functionality. Traditionally, fleet management includes:
Vehicle real-time monitoring
GPS technology can be used to monitor a vehicle’s location. Shippers can either install wireless units in their trucks or rely on drivers’ smartphones to monitor fleet performance. Data can be sent immediately to dispatchers who can access detailed information on truck and shipment locations in real time, capture changes in shipment size and destination, and monitor driver performance and issue penalties for violations.
Since the introduction of the electronic logging device (ELD) mandate in the US in 2017, ELDs have been compulsory for commercial motor vehicles. A logbook can be a standalone application, but sometimes software services providers include logbooks in their TMS software. Connected to the truck, an electronic logging device can track a driver’s hours of service (HOS), road speed, miles driven, and shipment date and time, automatically sending this data to an app.
Make sure you implement push notifications so drivers are instantly notified about violations or errors in the logbook.
Despite criticism from drivers, ELDs aim to increase drivers’ productivity, improve safety, reduce fuel costs, and help drivers get rid of manual logging.
Apart from fleet management, your multifunctional TMS system should have robust reporting and analytics functionality.
A dashboard should provide consolidated information about shipment statuses for managers. Here’s our design concept for a web-based dashboard where shippers can track shipments in real time.
A TMS should enable your staff to generate actionable reports. These reports should include carrier scorecards, distributional patterns, financial analytics, and shipment trends. These analytics can help you decrease spending and improve your level of service. Use visualizations to clearly present analytics. For instance, the Kuebix TMS uses pie charts and diagrams.
Challenge # 4 Inefficient asset tracking
Shipment consolidation is a big part of LTL operations in a hub-and-spoke network. To maximize container use, new orders have to be sorted efficiently in a hub.
RFID (radio-frequency identification) technology can be used to manage logistics and inventory problems faced by LTL companies. RFID tag scanners automate the verification of sorting and pooling within a terminal. It also reduces delays, as it enables faster creation of waybills and delivery notes, ensuring smooth sorting of shipments.
To use RFID technology, an LTL carrier’s terminals need to have RFID readers and software installed and also implement tagging capabilities to tag new shipments and follow them through the LTL network. Contrary to a barcode scanner, a tag reader can read multiple tags at once as long as they’re within its transmission field.
Readers can be fixed at portals or storage areas, or they can be mobilized in handheld devices or on vehicles. There are several types of RFID readers that can be connected via USB and other connections, like Zebra’s Sled Reader, which connects via Bluetooth with iOS and Android devices. Bluetooth readers can transmit data to a mobile device, which can then forward that information to a server. The app that connects with this server can offer asset tracking and management functionality using information captured by the RFID reader. It can also provide barcode scanning features for shipments that don’t have RFID tags.
NFC on Android can also work with quite a few RFID tag types, even though NFC and RFID use different protocols for transmitting data.
Challenge #5 Driver shortages
The American Trucking Associations’ 2019 report shows some sad statistics: in 2018, the US trucking industry was short roughly 60,800 drivers; in 2017, this number was 50,700. The ATA predicts that if the current trends hold, the shortage could swell to over 160,000 by 2028.
The freight industry desperately needs qualified drivers to cover the demand for transportation. The shortage of drivers leads to a capacity crunch, making it harder to quickly find a truck.
To retain existing professionals and attract new ones, you should provide drivers with convenient working conditions. A feature-rich driver app can streamline common tasks and let drivers manage their time efficiently. During mobile or web app development, implement the following features to your app:
Advanced search and filtering. First and foremost, enable carriers to search for and accept shipment requests in the nearby area. This not only helps drivers fill the empty space in their trucks but also helps you deal with the capacity crunch.
Route optimization. No one likes wasting time in traffic jams or driving extra miles. Consider integration with external systems: add Google Maps or Mapbox into your application so drivers can create optimal routes in a few taps. Both of these solutions offer live traffic data, so routes are built with traffic information in mind. Besides optimizing time, these technologies help your company cut fuel costs.
Convenient check-in and check-out. Each time a driver enters the hub, they need to fill out a gate pass. To eliminate time on tedious writing, implement a convenient check-in feature that automatically creates a QR code with a gate pass. Amazon uses QR codes in their application for drivers, called Amazon Relay.
Proof of delivery. Proof of delivery is usually provided using a pin code, photo, or barcode scanner. The purpose is to inform the client that delivery has been made. Furthermore, this feature shows delivery progress and stores records for further analytics. E-signatures are a new way to confirm delivery by a client. Drivers just ask the client to verify receipt by signing for shipments right on the driver’s mobile device. This allows recipients to sign faster, increasing drivers’ productivity and simplifying the delivery process.
Dashboard. A driver dashboard should provide all details of a driver’s delivery history in one place. These details include earnings and miles driven. Drivers should also be able to look through data for specific date ranges and full years, as they might need this information for taxes. Consider integrating with management tools for accounting, payroll, payments, and time for transportation tracking.
Challenge #6 Annoyed clients
Not only drivers but also clients desperately seek a solution that will make their lives easier. Clients want to stay informed about all of their active shipments and get instant quotes for upcoming shipments. To best serve them, you should think about customer web or mobile app development. An ideal app includes the following functionality:
Instant quotes. Let users see accurate quotes for their shipments right after they provide information about their cargo.
Secure payments. Another step toward client convenience is enabling clients to pay for shipments with a few taps. For this, you should integrate a payment gateway into your application. You can learn more about payment systems in our article that answers the main questions about payment gateways.
Advanced shipment tracking. Clients want to know what’s going on with their shipments. Allow them to monitor shipment status and get alerts in case of any changes. In addition, you can integrate maps so customers can track their shipments in real time. Push notifications is another must-have feature to notify users about shipment arrival. Check out how we’ve designed the tracking feature in one of our projects called Brilliant Move. Here, clients can also see all their orders in the Shipment History section.
Arguments in favor of creating your own logistics solution
Major carriers like UPS, FedEx, USPS, and DHL have their own software development centers through which they develop customizable logistics management services.
There are several reasons why freight companies opt for creating their own application instead of using off-the-shelf solutions:
Complexity. Products available on the market are stuffed with a plethora of features. But sometimes this variety coupled with a poor UX makes the application too complex. So companies have to spend lots of time onboarding new staff on how to use the system. By creating your own system, you can choose only the features you need and create a simple interface.
Lack of customization. TMS vendors offer standard functionality. If a company wants to configure the system for their specific needs, they’ll need to pay for customization. So besides paying for the TMS, you must also invest in customizing the system for your company. The ability to customize and configure the app is the biggest advantage of creating your own.
Poor integration with third-party services. Imagine you decide to add some functionality to your licensed TMS. But the module with the functionality you need is incompatible with the TMS and can’t be integrated. You can avoid these issues if you have your own custom TMS.
The trucking industry is plagued with inefficiencies and structural mess. LTL shipping companies can gain in efficiency, overall shipping speed, and customer satisfaction with mobile technologies supported by solid backend infrastructure. If you have questions or want a pair of hands to automate your LTL freight business, write us. We’ll do our utmost to answer all your questions.