How Traditional Brokers utilize relationships and knowledge along with technological advances to create a more well-rounded experience for shippers
As technology continues to change the way we live and work, there is no escaping the transformative impact technological advances can and will have on the way we operate. The same is clearly true with the most recent phenomenon of ‘digital freight brokerages’, which consists of a number of new well-funded technology companies who have altered the business model of the traditional freight brokerage to fully digitize many transactions and eliminate the personalized experience with logistics professionals. While this alternative broker model has created a significant buzz in the industry as well as a number of early adopters, it clearly will not overtake the traditional freight brokerage any time soon. Here are a few reasons why:
There is a common pitfall with the adoption of technical processes that take away human interaction. Relationships are the lifeblood of our industry. You may be fine with using the automated checkout at the grocery store but for many logistics transactions, there is no replacement for the one-on-one relationship to provide peace of mind.
Customization and flexibility
Let’s be honest. It’s not just the human relationships, it is the trust that forms over years of service and hundreds of transactions. It is knowing that when things go wrong or changes need to be made, your logistics professional has your back. It’s akin to using google to self-diagnose a health issue instead of talking to your doctor. It may be more convenient but expertise is key.
Digital brokerages live on the load board. It’s true that many freight tenders can be entirely transactional and digitizing this process can save some time in the process. However, shippers understand that just as relationships with brokers provide assurances and comfort, so too do carrier relationships with brokers. A carrier relationship is not only important in fostering confidence but there is a symbiotic relationship between the carrier and the broker that often yields additional capacity that is not readily visible on the digital load boards.
Technology is a big part of what traditional 3PLs offer
Lastly, digital freight brokers didn’t introduce technology into the industry. 3PLs have been utilizing technological advances for several decades now. In fact, our Corporate Traffic development team consists of 10 employees, including 5 developers who work directly with customers on tools and integrations to provide full visibility and transparency across the supply chain. Choosing a traditional 3PL does not mean you eschew many of the latest enhancements in visibility and pricing.
The bottom line is this. Technology will continue to change the way we live our lives and operate our businesses. However, in most cases, the best use of technological advances is to integrate these efficiencies within your current systems. A 3PL with experienced brokers and great customer service and the technology in place will always be a more secure and reliable option than even the largest digital broker. The personal relationships and hands-on problem-solving that 3PLs provide will outweigh any minor cost savings every time.