The value of consistent business is most evident in financial reports — no large spikes in revenue followed by downturns. It makes investors very happy, but it also pleases company stakeholders. For less-than-truckload (LTL) carriers, managing or even minimizing those spikes can smooth out financial irregularities and allow for more streamlined overall operational performance.
Dealing with those spikes, though, is a struggle for most LTL carriers. The very nature of LTL freight is inconsistent, but smart carriers manage through this thanks to relationships. Whereas the bid/booking process for truckload freight is easily automated these days, most LTL freight booking still involves human interaction and is the reason relationships remain so important.
According to Lance Healy, co-founder of Banyan Technology, the average shipper uses 10 to 12 LTL carriers and does not allow a transportation management system to make the final decision on which carrier it uses for any specific shipment. Conversely, many LTL carriers don’t want every shipment a client wants to move because it decreases operational flexibility — a hallmark of LTL shipping.
To help build the relationships necessary to ensure consistent freight, Banyan launched a tool last year called Live Lane Specials. Today, it is adding to that solution with the new Insights dashboard.
“Right now, [LTL carriers] are totally blind. They’ve never had this kind of data,” Healy told FreightWaves. “So, when we combine this Insights tool with the Live Lane Specials, they are not throwing hand grenades at night, they are using a laser pointer.”
Insights details to carriers what lanes they may have lost shipments on, and what the monetary difference was, among other key details. Healy said carrier information is never exposed and a carrier reviewing a shipment would not know from the Insights dashboard what carrier won that load.
“We’ve been offering Live Lane Specials for over a year but carriers had to guess what price they should offer a shipper on individual lanes. Insights removes that guesswork,” Healy said.
The new addition builds on the success that Banyan, founded in 2001, has found with the Live Lane Specials tool, something the company refers to as “intelligent pricing.” Banyan explains that intelligent pricing allows carriers to offer contract-specific pricing incentives through its Live Connections data hub. Live Lane Specials would be on top of any discounts already negotiated with the shipper or 3PL through an API-powered dispatch system. Any additional incentives appear automatically within the shipper’s workflow.
Live Lane Specials are executed after a carrier inputs the rules — either existing, preset rules built into the intelligent pricing dashboard, or custom rules the carrier writes — that define the targeted attributes those incentives will be applied against. These could be based on geography, shipment attributes, clients or even customer behaviors.
Carriers can cap the dollar amount or number of rules that will be applied on each lane and can hide the number of lane discounts showing to any shipper awarded that lane within a recent time period.
The often lower-than-contracted rates appear directly within their transportation management systems. Using current data to identify empty or partially empty trailers, this real-time replacement to static, labor-intensive rate tables makes it possible for LTL carriers to take advantage of opportunities to balance and maximize capacity on their networks.
The company notes that despite the automated nature of the tool, the carrier remains in total control over the final rate. All connections are available through application programming interface technology and can be integrated with most major transportation management systems.
Healy said the concept behind the Live Lane Specials was to empower carriers and give them some control over pricing.
“The carriers are able to go proactive and say these are the lanes I’d like to get, these are the lanes that are attractive to me, and that is the Live Lane Specials,” Healy said.
Shippers don’t necessarily know what special incentives may exist as the special is not applied until after the contract is agreed upon, but it does allow a carrier to offer various discounts and build up goodwill.
“For the shipping manager, they are able to walk into their front office each month and say, ‘I rock and here’s why. Here’s what I had to spend and here’s what I did spend,’” Healy explained.
The average savings for shippers on Live Lane Specials in 2019 was 12.9%, and 23% of the time a special was offered, Healy said.
Banyan also offers tendering, tracking, document retrieval, invoice and freight bill management capabilities.
Click for more FreightWaves articles by Brian Straight.
You may also like:
Trucking executives hope for a Nike Swoosh recovery
A life well lived is a life lived in trucking
Is Amazon on the hunt? Analyzing rumored Macy’s, J.C. Penney acquisitions
