For every shipper looking for transportation options across North America, there are several thousands of freight brokers who solicit their services through repeated phone calls, emails, and targeted marketing campaigns. This saturated marketplace must make shipping managers feel like it’s Groundhog’s Day all over again. Every morning, a new company offers the latest SaaS technology that will help “revolutionize” a shipper’s operations. Saas can be great for shipping managers to visualize their supply chain, and have functions to book their own loads and stuff, but this process has inherent limitations. Transportation is not an automated service. Behind the technological veil are tens of thousands of workers, drivers, operations and carrier representatives, logistics coordinators, and customer service personnel who manually ensure that loads are delivered on time and in full.
That’s where managed transportation service comes into play. This modern approach to logistics offers customers a consultative approach to their supply chain that formulates a plan to create actual scalable growth, streamline operations, and provide technological solutions to help shippers reduce their transportation costs. This article looks at TaaS, or Transportation as a Service, which is the most fundamental aspect of logistics. This logistics strategy, pioneered by Zengistics, gives shippers a customizable combination of service and technology to fit their exact shipping needs.
Over the past several decades, the logistics industry has relied on a primarily standardized approach to forging business relationships between shippers, brokers, and asset-based carriers. It goes something like this: A transportation service provider contacts a shipper and solicits their network of trucks. The shipper sends the load details to the broker or operations rep, who then builds the load, secures capacity, dispatches the truck, and ensures the carrier arrives at the shipper and receiver. While this standardized approach to logistics has served the industry well enough since the 1980s, the model itself contains its own inherent set of limitations and inefficiencies.
The relationship between shippers and their transportation providers should be one that forges a blueprint for development consistent with providing scalable growth for both companies. For brokers, this has generally meant taking on a larger share of a shipper’s business; increasing a share of volume means moving more loads and maximizing profits. But what does a shipper get out of this in return? Perhaps the act of giving more loads to a freight broker signals an increase in confidence that they can take on a larger role in servicing their transportation.
One of the most consistent challenges for freight brokers and asset-based carriers alike has been poor route optimization and low truck fill rates. Shippers and carriers often struggle to find the most efficient shipping lanes, leading to increased transportation costs and hidden environmental costs as trucks use more diesel, creating carbon emissions and pollution. Trailers are often underutilized, with fill rates as low as 60-70% of capacity, meaning that shippers are running loads that could be consolidated to save costs.
Communication is also a consistent challenge that has plagued the logistics industry since Ronald Reagan was president. Despite technological advances like emails, cellphones, and GPS, drivers still miss their pick-up and delivery appointments, and shippers still ask, “Where’s the truck?” Shippers are sometimes left in the dark, too, when unresponsive brokers or a communication breakdown leads to a lack of transparency between the carrier partner, the driver, and the shipping coordinator. All of this causes a waste of time, energy, and money spent tracking down a truck’s location.
As the logistics industry continues to evolve and incorporate more modern approaches to intertwine transportation with new technologies, more shippers are shifting their focus towards identifying the areas within their supply chain that need improvement. Most shippers are now looking for ways to help streamline their operations, cut down their transportation costs, find ways to improve customer satisfaction, and increase the rate of on-time deliveries of their products. This new approach starts with partnering with a transportation service provider specializing in managed transportation services.
Zengistics is pioneering a new approach to logistics that starts with transparency; they have created a collaborative logistics platform that allows shippers to gain unprecedented control over their supply chain. Zengistics approaches customers with a proactive model in conducting business. They start by researching and analyzing a shipper’s internal reports, including their master load lists, and production schedule. Zengistics’ dedicated team of data and pricing analysts creates advanced customizable reports designed to target key areas within a customer’s supply chain that can be optimized to reduce inefficiencies and improve on-time performance. Transportation as a service is now more collaborative and streamlined, eliminating some inherent roadblocks that have hindered supply chain performance. This approach helps reduce or eliminate supply chain disruptions that have become commonplace within traditional brokerages.
One of the best examples of how Zengistics has helped transform logistics management involves the case of Stone Brewing. This craft beer giant for decades has been one of the largest and most respected breweries in the United States. Zengistics took over the planning, scheduling, load building, packing, carrier procurement, and route optimization of their entire West Coast and East Coast transportation. With the help of advanced data analytics and Zengistics’s collaborative online platform that catered to the specific fulfillment needs of Stone Brewing, they averaged a 98% fill rate on every load and delivered on time and in full 98% of the time. As a result of this collaborative partnership, Zengistics now controls 100% of Stone Brewing’s outbound transportation. Using advanced customizable reports that consider industry data on the U.S. truck market, and other factors, Stone Brewing can now use Zengistics’s online platform to decide which production facility they should batch the beer, helping the brewery save money on their yearly transportation costs.
Traditional brokerages that operate on antiquated TMS and internal datasets might maintain their own scorecards on carrier performance. Most cradle-to-grave brokerages have a notes section where individual broker agents and carrier reps can add comments about whether the company delivered on time or if they experienced a service failure. This data is often siloed and incomplete—and lacks the quantitative analysis necessary to offer advanced analytics on whether the carrier is performing at a level that deserves continued service. Personal preference and individual carrier relationships are often the only metrics that brokerages use to determine which truck company gets assigned to a load.
Another way Zengistics helps customers improve the overall health of supply chains is by creating advanced KPIs that track the metrics of each carrier within your transportation network. Using technologies that track advanced data modules, Zengistics offers customers features that include carrier scorecards to measure on-time performance and communication. Using market data that tracks seasonal fluctuations in the U.S. truck market, companies can also offset moments when truck density becomes scarce; predictive rate modeling is one of the metrics shippers can use to ensure steady capacity year-round. Shippers also depend on Zengistics to use advanced market reports to analyze freight costs. This is particularly useful for shippers heading into mini-bids or annual RFPs, ensuring market prices align with carrier expectations.
The other significant advantage of a managed transportation service is streamlining load notifications into a single, easy-to-use digital platform. Instead of receiving multiple load updates that track whether the carrier assigned to the load is doing its job, Zengistics offers customers access to a digital platform that provides real-time visibility on all shipments. Customers receive automated notifications on all pickup and delivery reports, as well as real-time tracking with GPS of all live loads in transport. On top of that, using the customizable online platform provided by Zengistics, customers can search previous or live loads based on PO number or BOL, helping shippers centralize their data to a single platform.
For shippers that outsource their transportation to third-party vendors, the expectation is that operations and service should improve over previous carrier partners. What Zengistics offers customers with its managed transportation service is the ability to eliminate some of the time-consuming tasks that shippers almost expect as part of their daily operations. Most shippers have teams of personnel with jobs devoted to tasks that involve manual data entry. Those jobs include sending load details, receiving emails and phone calls concerning load notifications, calling brokers to ensure that trucks are positioned accordingly, and ensuring that the proper paperwork is received to perform payroll and account audits. These processes are items Zengistics has automated for shippers, allowing companies to reallocate their workforce to other areas that concentrate on customer success and expanding business verticals. Zengistics combines this automated feature with its live support team, which provides 24/7 coverage on all loads year-round. This gives shippers the peace of mind that their loads are in good hands and that they will always be aware of the status of their shipments.
Across North America, shippers are turning to transportation providers who can help alleviate some of the everyday logistical challenges they face when managing their transportation. While there’s no shortage of brokers that solicit services to shippers, few, if any, provide a holistic approach to transportation that is designed to alleviate all of the common problems shippers face when they try to move their products from A to B. Zengistics is transforming the logistics landscape, offering shippers a commonsense approach to streamlining their supply chains and improving customer satisfaction. The future of logistics is based on implementing technology-backed strategies that minimize manual data entry, reduce a customer’s environmental impact, improve visibility over a supply chain, and reduce the overall transportation budget. Zengistics has pioneered an approach to logistics that involves turning transportation as a service into a means for optimizing supply chains. Their customizable technology and user-friendly platform enable shippers to get more control over their supply chain. Don’t wait for your next service failure to seek another provider. Connect with a Zengistics expert today and transform your supply chain.