uShip introduces online LTL spot rate marketplace
January 23, 2014
uShip, an Austin, Texas-based provider of online freight marketplace services, said this week it has rolled out an LTL (less-than-truckload) spot rate marketplace, which includes 16 asset-based LTL carriers.
Company officials said this new service enables LTL carriers publish real-time, dynamically-priced rates to––and work directly with––small to midsize shippers posting freight to the uShip freight marketplace, which, in turn, helps LTL carriers optimize their highest yield profit segment.
Participating LTL carriers in the uShip LTL spot rate marketplace, include: R&L Carriers, Roadrunner Transportation Systems, Averitt Express, Pitt Ohio, Midwest Motor Express, AMA Transportation, American West Transport, Atlas Motor Express, Benton Global, Daylight Transport, East/West, Frontline Freight, NTC (Nebraska Transport Company), Pilot Freight Services, SHIFT Freight, and Southwest Motor Transport Inc.
Jim Bramlett, GM of LTL at uShip, said in an interview that this new marketplace provides widespread benefits for involved LTL carriers and shippers alike.
“Our LTL spot rate marketplace provides a vehicle for LTL carriers to modify pricing as freight conditions change over time,” explained Bramlett. “In other words, through our marketplace, the carriers are in control of the pricing and can dynamically adjust it to attract freight when and where they need it, or the inverse, to ensure they make sufficient profit on over-balanced lanes or time frame.”
As an example, Bramlett noted that most LTL carriers are flush with freight at the end of a quarter or month and should increase pricing––akin to what airlines do over the holidays––during those times, as the marketplace is targeted at non-contract shippers.
And LTL carriers, he said, have traditionally set pricing on an annual basis and many press them to contract their pricing for a year leaving little room to manipulate supply and demand.
“This theory also works on a geographic basis,” he noted. “Let’s say a carrier lost a piece of business in an important lane and were seeking to attract business to balance operations and minimize empty equipment. They could use the marketplace to price accordingly to attract business to that lane.”
As for shippers, Bramlett said that the marketplace provides them with the ability to monitor and take advantage of the carrier pricing where it is promoting business and can do that through instant rates that carriers are publishing via the marketplace or request a spot quote for today based on their shipment characteristics.
“By its very nature, a marketplace allows a shipper to understand supply and demand on a nearly real-time basis and take advantage of it when it works for them,” he said. “Larger shippers hedge the fluctuations in supply and demand by seeking contracts. Smaller shippers don’t have that luxury and thus can use a marketplace to ensure they are getting the very best deal possible and yet, control the quality of service provided by being able to choose from a wide variety of transportation service providers.”
Other shipper benefits of the marketplace cited by Bramlett include providing non-contracted shippers with the ability to take advantage of carrier promotions when carriers can use price to attract business on certain lanes or during certain time periods. And by dealing directly with carriers through an efficient marketplace, overall execution costs are lower and allow shippers to benefit via price.
“The marketplace also provides an efficient process to determine today’s spot price market, especially for volume shipments (i.e. >6 pallets or >10 linear feet),” he said. “Shippers can engage multiple transportation service providers electronically to retrieve spot quotes, evaluate all options quickly, and don’t need to rely on multiple phone calls and emails to manage the process.”
And in an unique twist, he said through the marketplace shippers are able to evaluate the performance of any service provider in the marketplace, as each shipper has the ability to rate a carrier’s experience so that other shippers can see their experience.
“It works a bit like Amazon where consumers can rate various products,” he said. “uShip uses a 5-star rating matrix and any shipper can see how many times a service provider was rated and the overall user experience on a 5 star scale. For the service provider that delivers impeccable service but might have higher prices, the shipper can determine the trade-off of quality and price they are willing to accept. For lesser-known carriers, this is an invaluable tool to help them build their business.”
Ten-year old uShip started planning the marketplace to target business shippers in 2011 and actively took steps to launch starting in 2012. Bramlett said having a successful marketplace that accommodated the consumer to consumer shipping provided a great platform and scale to add this dimension, adding that uShip is currently focusing on the LTL space, but over time will add other modes.
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