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How to reduce empty shipping with a freight exchange?

17 June 2021 | 5 min read

The increase in low-volume online orders with ever shorter contractual deadlines has consequences for freight forwarders. In recent years, these logistics companies have been faced with a significant rise in empty or under-capacity shipment. According to ADEME figures, 25% of the miles traveled in cities for the transport of goods are done empty.
Today, solutions are available to increase the filling rate of trucks and thus reduce underweight running. For example, the freight exchange is an attractive system for sharing freight.

What is a freight exchange?

A freight exchange is an online marketplace that optimizes supply and demand between carriers and freight forwarders.

The objective of the carrier is to keep its empty running rate to a minimum by offering its available transportation capacity. In other words, they want to maximize the fill rate of their trucks and thus reduce their CO2 emissions and fuel consumption.

On the other hand, the shipper wants to send furniture to his customers at a lower cost. To do so, he directly makes request for proposals with the details of the goods he needs to ship from the freight exchange platform.

How does the freight exchange work?

To make it simple, the freight forwarder makes a call to tenders on the freight exchange. The carriers offer services according to the weight and size of the merchandise. They also have the possibility to add extra costs according to the geographical areas or the time of delivery.

For instance, a freight forwarder wants to ship parcels to Strasbourg, France. In order to meet the commitments made to his customer, the delivery must be completed before Wednesday, between 8 am and 10 am. By logging on to the platform, the freight forwarder can see all the delivery offers that correspond to his needs. All they have to do is choose the one that seems the most interesting.

What are the advantages of a freight exchange?

In short, using a freight exchange allows you to :

• Find available space in a vehicle in a few seconds to transport your goods at a lower cost.
• Improve truck fill rates and reduce expensive empty running.
• Determine the best transport routes in compliance with the contractual commitments.
• Expand its activity to new geographical areas.

Reduce empty shipping for carriers

According to the figures of the French federation of e-commerce and distance selling (FEVAD), the French spent €112 billion for their online purchases in 2020, which is an increase of 8.5% compared to the previous year’s figure. With the exceptional growth of e-commerce, enhanced by the Covid-19 pandemic, low volume orders have multiplied. In addition, consumers are demanding faster and faster deliveries, with the ability to choose a time slot for delivery.

These new consumption methods have resulted in a significant increase in empty or under-capacity transport. According to the Eurostat data, we could already observe this trend in the 2000s, when e-commerce started to grow thanks to the internet. At that time, empty running already represented 15% of domestic traffic and 25% of international traffic in the European market. In 2018, empty transports have continued to increase to reach 18.4% of the distance traveled.

The increase in empty shipping considerably reduces the revenues of the carriers. It is because fixed costs, such as fuel consumption or maintenance costs, remain the same for a truck that is running under-capacity. This is especially true in a highly competitive environment, where carriers are unable to charge their customers for this additional cost. Furthermore, imposing additional delays on buyers because their trucks are not filled to their maximum capacity cannot be considered as an option.

In addition to the economic consequences, these under loaded routes also increase CO2 emissions. While the ecological transition is today at the center of all concerns, the improvement of the filling rate of heavy goods vehicles is becoming a major issue for carriers. Well, the freight exchange is responding perfectly to this new issue.

Using these virtual marketplaces, carriers can offer the space available in their vehicles. To do this, they simply respond to the calls to tender from shippers by offering transport services based on several factors: weight, size, type of goods, loading location, delivery time slot, etc. For transport companies, it is the guarantee to improve the profitability of the logistics activity.

Reduce transportation costs for the freight forwarder

The freight exchange increases the profitability of both the carrier and the shipper. Indeed, the confrontation of supply and demand on this marketplace allows shippers to benefit from the best offers for national or international transport.

Ensure 100% successful delivery

Beyond the product, consumers are giving more and more importance to the delivery. Delayed delivery, damaged packages or no delivery at all can have a significant impact on the level of customer satisfaction. Obviously, a consumer who is not fully satisfied with the service offered, usually does not place one more order with the distributor. This is why many shippers are still quite worried about outsourcing their deliveries to an external service provider.

In response to these concerns, many transportation companies are also using last-mile delivery optimization systems. In addition to offering considerable time savings in the organization of transport, these solutions allow shippers to ensure a 100% successful delivery.

Consider the example of AntsRoute, a route optimization solution that allows :

• The sending of SMS notifications at each step.
• The respect of the visiting time slots requested by the buyers.
• Automated sending of reports to customers.

5 freight exchange platforms available in 2021

In recent years, the number of freight exchanges has increased. Here is a selection of 5 solutions that can meet your needs:

Teleroute

It is a leading provider of freight exchange services in Europe. Founded in 1985, Teleroute is now available in 29 European countries. From this interface, you can access more than 200,000 daily national and international freight offers from nearly 70,000 carriers.

Timocom

The TC Truck&Cargo freight exchange from the German company Timocom is now the European market leader. Up to 800,000 international freight offers from more than 135,000 users across Europe are posted on this platform.

Webtrans

Webtrans is a logistics management platform which offers freight exchange platform. In addition to this service, the company offers services to manage invoicing and advance payments.

Shiptify

Created in 2016, Shiptify is a French startup that offers digital and collaborative software for shippers and carriers. It offers a private freight exchange that allows users to set up and manage their network of regular carriers from a single interface.

Woop

Woop coordinates all delivery offers from more than 40 partner carriers through a unique interface. The platform allows retailers to access a wide range of national and international carriers. By identifying different delivery options based on predefined factors such as price, quality of service and carbon impact, Woop enables its users to choose the most suitable offer at the best price. In addition, the software has a connector with the AntsRoute route optimization solution to allow its transportation partners to smartly manage routes and reduce their CO2 emissions.

To optimize your routes with AntsRoute, simply create a free 7-day trial account, without any credit card number or commitment!