Happy New Year from North America’s only Collaborative Transportation Platform, to all you freight industry experts! We can all breathe a sigh of relief as we leave 2020 behind us, but that doesn’t mean everything's going to be easy. In fact, all of us at SemiCab believe the freight industry still has a lot to do in the upcoming weeks, months, and years to get ahead. In order to help you prepare for 2021, here’s a summary of 3 trends we’re anticipating.
So far, rates have started out strong for this time of the year, but we believe they are going to remain unpredictable for the foreseeable future. As we continue our battle against the pandemic, we expect that demand patterns are going to be similar to 2020 through at least the first half of the year, and that significant additional capacity is unlikely to enter the market during this time. And even though carriers are placing new truck orders at a record pace, it has been difficult to maintain the current driver pool and to attract new drivers to this vital frontline function, which may have a significant impact on the freight industry down the line. We believe that we’ll approach quasi-normalcy in the mid-fall, and that demand may spike before settling back down to somewhat “normal” patterns. These factors will make spot prices incredibly difficult to predict.
At the moment, contract pricing is trying to catch up with the recent pricing environment as shippers try to determine their approach – some shippers have opted to sign short-term contracts at elevated prices expecting the rates to go down in the near future, while others are locking up capacity through contracts that are longer-term than what they usually opt for. These decisions have an impact on carrier networks and their efficiency and margins. One thing’s for certain, both carriers and shippers will need to adopt new technology solutions to stay ahead of the competition. Logistics providers who want to survive should move beyond basic automation.
Focus on Sustainability
We’ve all been expecting it: sustainability will be a big part of the picture in 2021 and the years ahead. As the freight industry embraces the need to address sustainability in a proactive manner, carriers and third-party logistics providers have seen it become a requirement or, at minimum, a serious consideration for most shippers. We believe that to fully compete in 2021 and through the next decade, logistics companies will need to make sustainable freight practices a top priority. This means top-of-mind goals for shippers will include reducing C02 emissions and making the move to alternative fuels.
Thankfully, collaborative technology solutions can provide third-party logistics suppliers with insights into how to reduce emissions by optimizing shipping efficiencies while creating significant additional value at the same time. As a Collaborative Transportation Platform, SemiCab is poised to do exactly that. First, SemiCab brings shippers together to identify efficiencies across their networks, then we use our proprietary machine-learning algorithm to help them find best matches on recurring lanes, and finally we allow different parties to connect and convert traditional one-way moves into more collaborative round trips. This is how we become more sustainable, one truck at a time. One could say that achieving higher levels of sustainability requires all constituents in the transportation ecosystem—shippers, carriers, brokers and 3PLs—to work together on Collaborative Transportation Platforms.
Technology is the Answer
This will come as no surprise, technology will continue to become more and more important in helping the freight industry stay afloat, and eventually thrive. In fact, 2020 saw an increased level of private equity/venture capital interest in "freight technology" even when compared to the years before. We’ve witnessed multiple ventures launched in this space over the last five years. Because of this interest, we’ve also seen the introduction of new and innovative models to solve different problems, such as bringing owner-operators and smaller carriers into the capacity pool in a more direct manner, helping carriers comply with ELD/HOS mandates, automating brokerage processes, as well as collaborative solutions to unlock latent capacity.
This growth in technological offerings has not gone unnoticed. Gartner recently released their Market trends report with clear classifications of the many freight technology models, approaches, and vendors available to date. They are:
● Digital Brokers
● Digitized Freight Networks
● Digitized Freight Networks with Assets
● Freight Insights Technology Platforms
● Collaborative Transportation Platforms
● Carrier Relationship Platforms
● Technology Provider with a Digital Freight Platform
● 3PL with a Digital Freight Platform
This report correctly lists SemiCab as the only vendor recognized as a representative vendor for Collaborative Transportation Platforms (CTP) in North America. We’re confident that 2021 will see this space move beyond basic automation, like SemiCab has. We’re tackling a diverse set of problems which will eventually lead to some overlap between these solutions. Over 2021 and the coming years, these solutions will come together through neutral platforms to transform the trucking industry.
It’s clear that technology is paving the way to efficiency. Embracing technology early on will be a boon for all players within the freight industry. Regardless of whether the hope is to tackle volatility, become more sustainable, or attain reliable and efficient capacity, technology is the answer. With our designation as a CTP, SemiCab is doubling down on its commitment to bring shippers, carriers, and brokers together to eliminate freight inefficiencies once and for all.
To better understand the many technological offerings available within the freight industry, download the Gartner report, Market Guide for Digital Freight Models for Road Transportation. Get the full scoop on the different freight tech models out there and learn how we compare as a Collaborative Transportation Platform.