The future looks pretty bright for the LTL industry. With the bolstering economy, expanding E-commerce, and tight truckload capacity, all indicators point up for the LTL industry. As Adam Satterfield, CFO at Old Dominion Freight Lines, was quoted in a recent Transport Topics article,
“There is going to be a continuation of the long-term shift within supply chains that will likely move freight into LTL from other modes because of reduced shipment sizes and length of haul,” Satterfield said. “Supply chains, as they become more sophisticated, focus on high quality service.” https://www.ttnews.com/articles/ltl-carriers-refine-expand-services
The LTL industry is enjoying the trend of supply chains reducing the size of their shipments to counter ever-increasing truckload shortages. Gone are the heady days of transportation buyers receiving on-demand truckload service. In today’s market capacity is king and due to the business model LTL carriers follow, they have the capacity.
In response to the increased volume, LTL carriers are not sitting on their hands. Carriers are turning up the dial on customer service, adding capacity, augmenting hubs to service their customers more efficiently, and offering a better customer experience doing it. Companies are also investing in improved technology and increasing their networks with a focus on increased last mile delivery.
For Transportation Management System (TMS) providers, the growing trend toward LTL is good news. While LTL offers more dependable capacity for supply chains, it is also more complex to manage. Pricing, discounts, and accessorial charges can vary from LTL carrier to LTL carrier. Moreover, not every LTL carrier is competitive in every transit lane. These variances make the choice of carrier more important and complicated. As a result, more shippers and 3PL’s are turning to TMS providers to help manage LTL shipping and up their game.
With today’s TMS systems, users benefit from better tracking, financial management, and data analytics. Moreover, 3PL’s and shippers can quickly compare rates and transit times of multiple LTL carriers side by side and book a shipment choosing the rate and transit time best for their needs. As LTL volume increases, TMS companies are rising to the challenge by making technology more scalable, collaborating closely with their customers, and focusing on increased accounting visibility.
Responsive TMS software providers want to make as many processes for their customers as effective, fast, and straightforward as they can. One growing TMS trend is arranging with cargo insurance providers to integrate with their TMS software to allow their users to purchase needed cargo insurance while booking shipments in one seamless process. This advancement will save 3PL’s and shippers a great deal of time and money. Formally 3PL’s or shippers had the choice of securing a yearly ‘cover all’ cargo policy or arranging cargo insurance as a separate process with a broker, an online account, or through an intermediary.
Since no one wants an extra process in their lives, yearly policies make sense. While yearly policies are good, not every 3PL or shipper wants to insure all shipments or even qualifies for one due to lack of volume. TMS providers are meeting that challenge by arranging for their clients to have access to cargo insurance within the TMS software as they need it with no extra process. Since TJO Cargo offers TMS integrated cargo insurance services, we would be happy to answer any questions you have about it. Just contact me at tom@tjocompany.com, and I will have information sent to you by e-mail.
There have been a good amount of technology advances in the supply chain industry in the past few years. To not keep up with the changes puts companies at a clear disadvantage. LTL carriers and TMS software providers are as well aware of this as anyone and are not waiting around for opportunities; they are creating them.