Intermodal Drayage: How “Business as Usual” is Killing Productivity and Profit at IMCs

Mike Albert | DrayNow

THERE’S A DIRTY little secret that drains the productivity of intermodal marketing companies (IMCs) and erodes their ability to give shippers the accurate, real-time data they want about in-progress moves. That secret is the heavily, manual nature used to source intermodal drayage capacity and provide status updates and paperwork.

You don’t call your bank to find out your current account balance. You shouldn’t be calling a carrier to see if your truck met its ETA.

New, digital marketplaces for intermodal drayage provide a solution to these profit-sucking productivity problems. But many brokers/IMCs remain stuck in the 1980s, relying on phone calls and emails to manage capacity sourcing and status updates. These entrenched, “business as usual” approaches have severe negative consequences that are simply not sustainable.

Several processes limit IMC’s productivity and profits.

Sourcing Intermodal Dray Capacity

IMCs spend a good part of each week calling carriers to arrange moves to and from rail yards. This old-school, one-to-one outreach is killing the productivity of these reps, that could be using that time to manage more loads (and book more revenue!) There’s a fix for manual-intensive commerce processes in the digital age. They’re called marketplaces, and they enable a highly efficient one-to-many connection between supply
and demand.

Collectible sellers no longer take out a bunch of ads; they list their items on eBay to reach 168 million active buyers. Crafters don’t rent space at dozens of craft shows and flea markets; they connect to 40 million buyers on Etsy.

Providing Status Updates

Shipment status updates are inaccurate and unduly time-consuming. Today, here’s what happens:

Shipper calls IMC asking about the status of a critical freight shipment and IMC calls carrier; Shipper waits; Carrier contacts driver (no answer); Shipper waits; Driver eventually calls carrier with status; Shipper waits; Carrier calls IMC; Shipper waits; IMC provides status update to the shipper.

There’s a joke here somewhere about the number of calls, emails and people required to answer just one simple question. Unfortunately, the impact of this inefficient process is no joking matter when you think about the poor customer experience and the massive productivity erosion for broker/IMC operations. With a more technology-enabled solution, drivers use their cell phones to continually update their status on the app in real time, which allows IMCs to consult the portal and provide an immediate and highly accurate status update to shippers.

There’s a fix for manual-intensive commerce processes in the digital age. They’re called marketplaces, and they enable a highly efficient one-to-many connection between supply
and demand

Chasing Down Documents

Today, paperwork accumulates on the driver’s passenger seat and documents are eventually sent to the IMC to process billing. IMCs can wait seven days or more for the paperwork loop to close. One larger broker actually has his carriers mail in paperwork daily and employs 18 clerks to process this paperwork for 1,700 daily loads. The logical alternative, of course, is to capture electronic versions of the documents and place them within an always-available online portal – a solution that already exists using the marketplace model.

Old-School Practices Can Slow IMC Growth

By embracing digital marketplaces and platforms, IMCs can accelerate revenue growth by gaining access to new capacity. Let’s say there is freight demand in Green Bay, WI, but the IMC does not have coverage in that area. The right marketplace allows this broker to book this load and realize that
added revenue.

Sales growth also relies on excellent retention of existing customers. Increasingly, these shippers are demanding a greater level of transparency on shipment status. They want to know, in real time, “Where’s my shipment?” and “When will it arrive?” IMCs that can’t provide these answers shouldn’t be surprised when these customers leave to find a partner that can.

With digital platforms, the data doesn’t lie – for better or worse. Driver updates are time-stamped, so all parties know the exact time loads were picked up and delivered.

Doing More, with Less

Freight marketplaces have gained a firm foothold in the traditional OTR trucking space, but intermodal is a part of the logistics industry that has been slower to adopt the new wave of digital innovations. Consequently, much of the work done by front-line brokers is manual and time-consuming.

There is more good news here than bad because of the massive upside change can bring. Individual freight specialists could reclaim as much as 50% of the time they currently spent chasing down updates and documents. Imagine how many more loads per week they could manage. And imagine what that could mean for your top and bottom line, agency wide.

IMCs play an important role in intermodal supply chains. By adopting collaborative, cloud-based work processes for managing intermodal drayage, IMCs can achieve a whole new level of operational efficiency – enabling them to manage more freight with fewer, more productive resources.             

Mike Albert, is Founder and CEO of DrayNow, a marketplace that connects shippers and carriers of container freight moving to and from rail yards. He can be reached at mike@draynow.com or 267-428-2702.

Image credit: JANE 0606/SHUTTERSTOCK.COM