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August 3, 2022

What is Digital Freight Matching?

DATA SPOTLIGHT

The purpose of the freight industry is to get vital goods from A to B. However, much of the time of truck drivers, brokers, hauling companies, and shippers is taken up by other tasks. There are phone calls, paperwork, and invoicing used to organize pickups and drop offs, ensuring that shipping takes place according to legislation, plus the time taken searching for loads or carriers and time spent driving deadhead miles. 

While mounting bureaucracy and paperwork are a concern within any sector, within the trucking industry they have the potential to adversely affect crucial supply chains, and today, a growing truck driver shortage is exasperating the issue. According to a report released by ATA last year, the industry may witness a 100,000 driver shortfall within five years, seriously threatening supply chains that ship around 72% of goods across US.

As a result, it’s clear that a smoother and more streamlined system for organizing freight is needed to help drivers, and the freight industry at large, to maximize the time spent moving goods. In essence, this is what Digital Freight Matching aims to achieve.

In this article, we’ll explore how this technology works, why it’s already proving  useful, the difference between Digital Freight Matching and Load Boards, and what to look for in your Digital Freight Matching software. 

How does Digital Freight Matching work? 

In its simplest form, Digital Freight Matching (DFM) works something like a digital freight brokerage. Shippers or freight brokers start by posting a job using a Digital Freight Matching service, including a range of important information such as their proposed rate, the weight of cargo, and the required pick-up and drop-off points and dates.

The purpose of doing so is to supply sufficient information to truckers so they can simply open the DFM’s load board, see jobs available in real-time, quickly evaluate the job description, confidently confirm within the mobile app, and start driving. By optimizing and accelerating the connection of shippers and carriers, DFM not only makes work easier to find, but makes it more accessible to a wider range of drivers.

As well as making it easier for dispatchers, truck drivers, and shippers to find one another, Digital Freight Matching platforms also help reduce the time dedicated to administrative work. As a sub-type of a Transport Management System (TMS), and powered by Application Program Interfaces (APIs) DFM services are able to integrate a wide range of manual processes into a single digital platform. This means that the best Digital Freight Matching software can incorporate payment, job loading, data tracking and a range of other services into a single service. With the integration of machine learning, this represents a significant step towards the automation of the trucking industry. 

What are the benefits of Digital Freight Matching?

The benefits of Digital Freight Matching can vary between platforms, and as the technology develops, may continue to expand. However, we’ve listed a few of the most significant benefits here. 

First, by optimizing and accelerating the connection of shippers and carriers, DFM not only makes loads easier to find, it makes them more accessible to a wider range of drivers. Out of the 1.2 million trucking companies in the U.S., 90% operate with 6 trucks or fewer, and are often overlooked in favor of larger haulers who can use the economy of scale to charge lower rates. By allowing shippers to advertise capacity in real time, and by using algorithms to help those jobs find the best-suited carriers, the freight marketplace can become more equitable. 

Second, Digital Freight Matching helps to digitize and simplify a range of complex tasks, providing localized suggestions, rather than leaving the driver or hauler to find them independently or through a broker. The service delivers an easy and affordable ELD compliance solution, online fleet management tool, and electronic logbook that centralizes the most important features. 

Third, Digital Freight Matching software can improve the prospective earnings for truck drivers by aiding their route efficiency. By offering optimized load matching in real time, DFM apps can enable drivers to plan overlapping LTL (Less than a Truckload) jobs, and in the future, the apps may even be able to load and establish routes for those overlapping jobs autonomously. Given the high supply of work which DFM software offers truckers, shippers are also encouraged to provide competitive rates, which drivers can benefit from directly. 

Fourth, the use of DFM software makes it easier to implement other time-saving procedures, such as drop-and-hook services, which benefit from DFM’s ability to support shippers and carriers in cooperating without intense planning and coordination ahead of time.

The difference between Digital Freight Matching and Load Boards. 

Load Boards are online marketplaces in which shippers and carriers can communicate with one another about available jobs. These jobs are posted along with essential information to help truckers decide whether they can take the work. 

As such, load boards are one of the central, foundational features of Digital Freight Matching software. They serve to help shippers and carriers find one another online, which is a key role of DFM. 

However, DFM providers tend to expand past this point, integrating a wide array of functionality by providing increasingly smart features, such as job suggestions, payment facilitation, smart routing technology, and the digitization of manual tasks. For example, it’s common practice for drivers to need to call shippers or brokers to confirm a job they’ve seen on a load board. In contrast, with Digital Freight Matching applications, it’s more common to be able to conduct all tasks, between viewing, accepting and receiving payment for the work using the DFM service. 

How to choose a Digital Freight Matcher

Tools are only useful if they serve their desired purpose; when they fail to work properly, they can often cause more trouble than they’ve saved. Because of this, it’s useful to know what to look for in a Digital Freight Matcher before committing to your investment. We’ve compiled a few of the most important considerations below. 

A user-friendly interface

DFM software is intended to improve efficiency in the freight industry, as well as make life easier for shippers and drivers. Therefore, it’s best to stay away from apps which are confusing, unreliable, or uncomfortable to use. Checking reviews, or even seeking out a technology demo or test period can help you ensure that your DFM software will make life easier rather than harder for your employees. 

Access to logistics specialists 

Many Digital Freight Matching companies have entered the market from a technology-first point of view. This means that they may lack some of the industry experience that  traditional freight brokers or Third Party Logistics Companies (3PLs) may be able to provide. Therefore, it’s sensible to check whether your provider also has human logistics experts available to help you to solve problems outside  of the scope of their software. 

Multi-functional app 

If your employees are going to spend time becoming accustomed to using new software, it’s important that doing so is worth their time. By ensuring that the DFM software you purchase is able to perform multiple functions for you, you can guarantee that their time is well invested. Among the useful services you should look for are: 

  • Load Board functions 
  • In-app payment
  • Tracking and monitoring of freight and emissions 
  • Managing and mitigating paperwork. 

Digital Freight Matching services are due to make the shipping industry faster, smoother, and more efficient. This is good news for dispatchers, drivers, shippers, and customers all across North America. 

If you’re excited by this too, and want to keep up the pace with the industry,  then you can learn more about how data and technology are supporting freight by following the FleetOps blog

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