“Freight rates are becoming more dynamic and moving away from…

This piece is long – but it is worth reading…
Sea change #1:  “Freight rates are becoming more dynamic and moving away from static rate tables in LTL” according to Peter Moore (an academic writing in Logistics Management and no relation).  This got me thinking – imagine a connected world where all shipper TMS’s are connected so there is network-wide visibility.  Everybody could see that there was going to be a shortage of trucks in Chicago in 2 days and rates would immediately change.  This may not be so far off…. Cloud TMS’s already have access to this kind of data – just nobody has strung it all together yet…but when they do there will be a Sea change including:
  • Hedging and truck arbitrage
  • Elimination of relationships and annual rates  
  • Trucking as a pure commodity 
Sea change #2:   Large asset carriers are worried that digital freight brokerages will hurt them
Sea change #3:  Amazon
  • “Amazon has so much growth, and so much supply chain talent…they can go direct, deal with intermodal and ocean carriers, and ultimately build their own brokerage and work with the carrier community,” Frank McGuigan, Chief Executive of transportation management firm Transplace
  • They have leased a number of air freighters
  • In package, they are already creating their own network