According to a report by consultancy firm Frost & Sullivan, mobile apps are leading the way to what they call “the Uberization” of trucking, or mobile-based freight brokering.
Trucker Path Truckloads lets users access available loads throughout North America.
3 min to read
Trucker Path Truckloads lets users access available loads throughout North America.
According to a report by consultancy firm Frost & Sullivan, mobile apps are leading the way to what they call “the Uberization” of trucking, or mobile-based freight brokering. Under this scenario, those who need transportation services and those that have an available truck can find each other using a mobile app designed to match the shipper and haulers needs in terms of rates, routes and scheduling.
The report authors contend that such business models will help reduce empty miles (which they estimate total up to 20 billion each year in the industry) and improve efficiencies in moving freight. The payoff: lower operating costs, improved fuel efficiency and better asset utilization, the report concluded.
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In an interview, Frost & Sullivan senior industry analyst Wallace Lau said for the report’s purposes, mobile was defined as app that is strictly used on a mobile platform and that generates revenue through the mobile platform in the form of fees generated for matching shippers and truckers.
The benefit to the trucker is that the app automates a number of processes such as dispatch, load finding, delivery status and driver payment, while providing real-time information on loads from pickup to delivery – all from a mobile device.
Wu said there is between 75% and 80% penetration in the U.S. mobile device market, which helps such apps reach a critical mass of users. Building networks with adequate truck capacity to meet shippers’ needs and adequate loads to meet truckers’ needs is "a work in progress,” Wu says.
“Today, there are many different and competing apps and networks to choose from,” he added. “As a result, competition is intense as market participants aim to differentiate themselves to attract shippers and carriers in efforts to make their network more robust with available loads."
A number of companies released new or updated apps this year, including CargoMatic, Venice Beach, Calif., which in June announced its mobile-based service in Southern California, targeting shippers and small trucking firms.
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Trucker Path, San Jose, Calif., which launched a trip-planning Android app in 2013, introduced an iOS version of its Truckload load-matching app (which was in beta testing) Nov. 18 and also added features to its current lineup of apps for Android.
Mobile technologies and the growth in e-commerce will provide opportunities for freight and logistic companies, Lau says, while traditional brokers have begun offering mobile-based offerings of their own to compete in the new space. He cited Coyote Logistic as an example. Another includes Transfix, a mobile-based brokerage app that evolved from the founder’s traditional family-owned brokerage business.
As Lau sees it, mobile-based brokerage is a win for all parties. “I don’t believe any one particular party stands to lose significantly,” he says, noting that mobile-based brokers are currently targeting mostly small fleets of 10 or fewer trucks. Plus, the freight industry is projected to grow which will allow it to support new technologies, he added.
Read more about mobile apps in the December issue of HDT.
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