Nearly two dozen logistics providers from across the transportation ecosystem today said they have joined forces to share data and develop common technology standards that could support more efficient operations in the less-than-truckload (LTL) sector.
The “Digital LTL Council” brings together carriers, logistics service providers, shippers, and technology providers with the focus of developing a set of uniform standards that support the scalable automation and digitalization of LTL shipments, the group said.
The effort comes as transportation providers across the nation have seen their operations stressed by extraordinary events throughout 2020, from booming e-commerce volumes and expensive tariffs on Chinese goods to the coronavirus pandemic and a contentious presidential election.
“The past year has introduced a variety of conditions that has further challenged Uline and the entire transportation industry to find new ways to operate efficiently while reducing cost and maintaining the health and safety of our employees,” Angelo Ventrone, vice president of Logistics at consortium member Uline, a shipping supply distributor, said in a release. “We’re excited to join other industry leaders to help create a set of standards and best practices that will enable the entire ecosystem to increase performance, meet customer needs, and keep our supply chains moving despite unexpected disruptions such as a global pandemic, extreme weather, trade disruptions, closed borders, and economic uncertainty.”
To achieve that, the group intends to automate shipping and billing workflows, ranging from payment to settlement, by developing digital standards. For example, some council members including Uline, Quad Graphics, Averitt Express, and Pitt Ohio have been running beta projects over the past 12 months, focused on developing more standardized electronic bill of lading (eBOL) solutions.
Early results from the council indicate that once manufacturers or distributors digitize the LTL shipment lifecycle, they’ll see an average of 2 to 4% cost savings per shipment, due to increased network efficiency and on-time performance, reduced safety stock levels, decreased dwell times, improved carrier performance, and heightened human resource efficiency, according to Christian Piller, vice president of Value Engineering at project44, another consortium member. Likewise, carriers could save up to 1.3% of certain administrative, bill entry, and customer service tasks, as well as an additional 2% reduction in operational costs, supporters say.
Those improvements are especially important at a time when shippers are increasingly turning to other carriers than the traditional powerhouses like FedEx Corp. and UPS Inc., such as regional last-mile delivery firms and even gig economy workers using their own vehicles as a “side hustle” to carry parcels for amazon.com or the DoorDash app, Piller said in an briefing.
Despite the need to collect data from that diversity of carriers, the move to digitalize the LTL sector has stumbled so far because the practice of data sharing has been like “the wild west," with each different logistics company forging ahead to create its own standards, said Brian Thompson, chief commercial officer at SMC3, which is also a consortium member.
For example, the fields on web-based forms that are used to share eBOL information often vary between one shippers and the next, while each carrier may require different integrations than its competitors, he said. Faced with that lack of a single “gold standard” for data feeds, some companies look at LTL digitialization and decide it’s just not worth the trouble, Thompson said.
“To manage the peaks and valleys of capacity that we’ve seen in 2020, you need visibility to what capacity is available,” Thompson said. “You need connectivity with an entire provider network, so if someone doesn’t have capacity for your load, you have access to others; you need depth in your provider base.”
The members concede that past efforts to create technology standards in fields like consumer electronics have often failed because smartphone vendors choose to compete by creating proprietary standards for charging ports or data connection cables, for example. In contrast, they say, the Digital LTL Council will benefit all parties by creating a core set of data sharing standards, while still allowing logistics providers to compete through additional service levels and specialties.
