Managed transportation providers generally base their services on the use of their own proprietary software in an outsourced arrangement. Photo credit: Shutterstock.com.
Transplace shipper customers can benchmark and analyze their rates and services against $11 billion worth of freight shipments thanks to new capabilities the Dallas-based third-party logistics provider (3PL) released Thursday.
The new tools, called Transplace Platform Services (TPS), allow shippers to use Transplace as a managed transportation service (MTS) provider without using Transplace’s proprietary transportation management system (TMS).
Traditionally, MTS relationships between shippers and 3PLs involve the shipper outsourcing all aspects, including technology, of freight management to the 3PL. Transplace is the largest such MTS provider in terms of freight under management in North America, according to recent research from consultant ARC Advisory. With TPS, a shipper would use its existing TMS or enterprise resource planning (ERP) software, but benchmark its network against the data tied to Transplace’s MTS network.
In practical terms, that means a shipper could, for instance, see whether there are opportunities to tender freight instantly to Transplace’s network of capacity before tendering it according to the routing guide and executed in its TMS.
Some TMS providers offer managed transportation services to shippers, but the advantage of Tranplace’s approach is that the technology and access to capacity are integrated, Transplace CEO Frank McGuigan told JOC.com. “The Transplace network is live and breathing. We’re a software company but also a services company,” he said. “We have every customer using the same instance of our software, but we also manage the network.”
McGuigan said existing Transplace MTS customers already get the benefits of the TPS tools, emphasizing that the new capabilities allow the 3PL to reach customers with which Transplace previously had limited interaction. Those include Fortune 500 shippers that are locked into arrangements with their ERP that “can get these things individually and transactionally, but not through a single API and can’t get the benefit of the large Transplace community.”
It also helps the 3PL reach mid-market shippers, “companies that need this, but that are not ready to jump into a network management arrangement,” McGuigan said. “They need it for buying freight, or getting health scores, or benchmarking. We’re trying to lower the barrier of entry for those customers into the Transplace community.”
Benchmarking opportunities
The TPS tools cover three areas, with shippers able to use some or all of the services.
TPS Data Insights allows shippers to benchmark themselves across common transportation management performance indicators: cost, speed, and service. The TPS Command Center gives shippers access to predictive visibility and transportation event monitoring via an integration partnership with MacroPoint, a trucking visibility provider owned by logistics software provider Descartes.
TPS Marketplace also gives shippers access to Transplace’s so-called network collaboration services, which finds tendering and load sequencing opportunities based on Transplace’s existing carrier network. The marketplace can also identify opportunities to consolidate less-than-truckload shipments into multi-stop full truckloads, the 3PL said in a statement Thursday.
“You get out of it what you put into it,” McGuigan said. “You can do a live feed from a company’s ERP if you want to use Transplace to see an instantaneous price, or dynamic continuous move before going into their whole TMS cycle. If you build the pipe one time and give us everything, it’s so easy to scale into these other products, like if you want me to look at your lanes, and compare service levels and see where opportunities are.”
Bringing more freight into the Transplace’s system provides more density to its network, which benefits existing Transplace MTS customers, but also benefits carriers using the platform.
“We would love for carriers to live in our network,” McGuigan said. “We would love to help them have a significantly better operating ratio by living in our network. The more freight we can bring to the table and the more times we can make static continuous moves, the better for those carriers.”
The move to provide a system-agnostic platform mirrors larger dynamics in the domestic and international freight markets, where large, established brokers, forwarders, and asset owners are using technology and access to capacity to provide capabilities that neutral software providers can’t. In the ocean shipping industry, that applies to container lines eager to become integrated logistics players.
Emergent brokers in the domestic freight market are trying to mimic that advantage by integrating directly with widely-used TMSs. The advantage Transplace has, McGuigan said, is the volume of freight it manages translates into a volume of data that smaller competitors have a difficult time matching.
“Transplace executes on $11 billion of freight with 1,100 people,” he said. “We have been a digital platform and will continue to work on automating that. We’re actually doing this stuff here. We don’t market before we execute.”
Contact Eric Johnson at [email protected] and follow him on Twitter: @LogTechEric.
