What is shipping visibility and why is it important? It’s more than just a fancy industry term. Shipping visibility technology companies are making a big push for increased transparency. And in today’s supply chain, transparency is more important than ever. The question is, how does shipping visibility impact trucking companies?
Visibility solutions are evolving from an add-on feature service into something more comprehensive. Still, an uptick in demand from customers and partners does not mean that every industry segment has adopted these solutions at the same rate or with the same vigor. Many trucking companies and shippers still struggle with maintaining visibility over their shipments.
Visibility solutions have generated a lot of buzz over the past several years. Still, despite its increasing popularity, visibility solutions are not widely used by trucking companies and shippers. Many do not currently have an in-transit visibility solution in place, which means they are leaving a useful trucking management tool on the table.
There is a dramatic difference between shippers and other industry players where visibility adoption solutions are concerned. Not even half of all shippers surveyed mentioned they use in-transit visibility solutions. Companies across other industries have demonstrated significantly higher adoption of in-transit visibility solutions.
How Shipping Visibility is Defined
Visibility refers to information. Specifically, this refers to information delivered in real-time, in an actionable format, to only the relevant people who can take meaningful action in response. Shippers need to ensure they carefully manage who has access to shipping visibility solutions.
For trucking companies and their customers, visibility primarily means continuous insight into the location and status of trucks, workers, and cargo. With improved visibility, trucking and logistics companies can easily supply valuable information to both internal operations and external partners.
In the past, this information hasn’t always been shared among partners in the supply chain. In part, this was due to a competitive business instinct that left partners wary of each other, but it was largely because the technology wasn’t in place to seamlessly gather and share this data. Yet, this technology is available now, and customer expectations have shifted as a result.
There’s no technological reason that trucking companies should avoid leveraging data-driven capabilities. Generating the data needed for visibility — then sharing that data outside of traditional information silos — has the potential to transform how the supply chain does business.
Why Are Shippers Reluctant to Use Visibility Solutions?
Shippers seem to be more hesitant to adopt visibility solutions than others within the logistics industry. This is particularly perplexing because shippers do not typically lag too far behind others when it comes to other types of technological adoption. Shippers are usually first adopters when it comes to utilizing tools like these.
There are a wide variety of reasons shippers are more hesitant to adopt a full-service visibility solution. Shippers may be wary of adopting technology they don’t think will last over the long haul. They may also have trouble finding a solution they believe will do a better job than their current, more old-school processes. Additionally, some shippers may rely on their carriers and third-party brokers to provide visibility solutions without giving much thought to adopting their own.
No matter their reasoning, however, many shippers are acutely aware that their lack of visibility technology could be hurting their ability to compete among their peers and may be harming their reputation and standing with their customers. This could have knock-on effects, leading to lost revenue and poor sales.
Is It a Lack of Confidence?
Many shippers and other industry participants question the quality of their visibility offering against those of their competitors. It is clear, however, that surveyed shippers believe their visibility offerings are worse than those of their competitors at higher rates than companies representing other industry segments. As a result, they wind up at a significant disadvantage when it comes to shipment tracking.
Despite shippers’ hesitation to adopt new visibility technologies, expectations surrounding visibility continue to become more and more demanding. Shippers and trucking companies raise their expectations for providers selling this technology. It is clear that visibility is valued among both supply chain partners and end consumers. This is largely due to its ability to streamline operations, pinpoint problems and increase accountability surrounding everything from sustainability to on-time delivery. Trucking companies can use visibility technologies to increase customer satisfaction.
While shippers seem to be adopting visibility technology at a slower pace than their non-shipper counterparts, it is clear they value the technology and understand the importance of shipment visibility to everyone in the supply chain.
How Has Shipment Visibility Evolved?
Real-time shipment visibility offers a vast array of insights into each shipment on the road. Most shippers and other transportation companies assert that information surrounding delivery timelines, customer service, frequent updates and freight damages was the most important. Visibility technologies need to focus on these factors first.
Other factors shipping visibility software generally offers include information about hyper-accurate location, legal risk, insurance claims and freight theft. These features are important to both shippers and non-shippers alike. Chain of custody and transparency are important to shippers. Temperature monitoring is also important. Shipping visibility solutions should cover these needs.
Despite a large majority of shippers reportedly not using an in-transit visibility solution, those who do see the benefit of using them. Those who do use shipment visibility solutions understand that utilizing them makes it easier to scale their track-and-trace capabilities. Shippers who partner with a visibility company to automate the track-and-trace process also understand that it improves client retention rates.
Perhaps unsurprisingly, shippers have a higher level of skepticism when it comes to overhauling their visibility platforms. They find it most important to access a network of visibility data without having to make major changes to their visibility platforms. They also worry about interoperability with their current systems. By comparison, their non-shipper counterparts don’t have these same fears. This trepidation and distaste for change may contribute to shippers’ slowness to adopt newer, more complex visibility solutions.
How to Track Shipment Visibility Solution ROI
Various factors come into play when companies evaluate the return on investment (ROI) on their in-transit visibility partners. A lot of shippers using a visibility solution report that they save a lot of money on human resources tracking loads. Others feel that scaling track-and-trace capabilities was the primary benefit visibility solutions provide their companies. What does this mean? Likely that many of these shippers are in the black and meeting their financial goals.
Other ROI calculations include money saved on loads, detention, or demurrage, and eliminated load rejections. They also report money saved on reduction of claims and money saved on theft/damaged goods. When you add these up, you are talking big savings just from adopting a visibility solution tool. Shippers who don’t take advantage of this solution are likely losing money needlessly.
Non-shipping companies using a visibility solution report largely the same benefits and ROI. What does this mean? That while all segments assess the value of a visibility solution in basically the same way, shippers either require a higher level of conviction to commit to a new solution or face additional hurdles on the road to tech adoption.
What do Shippers and Non-Shippers Value?
Shippers and non-shippers alike look for the same things in a comprehensive visibility solution. Still, shippers have been more hesitant about adopting the latest, more innovative solutions than non-shipper companies. The good news is that as the focus on real-time visibility intensifies, this relative lack of adoption will likely start ruffling feathers with supply chain partners and end consumers alike. This will create a big change in how shippers view visibility solutions.
Customers expect their shipping partners to upgrade their offerings and seek out in-transit visibility solutions. As companies adopt these solutions at higher rates there will be a lot less industry pressure to keep up with technological advancements. And when shippers do finally fully adopt these solutions, they will likely seek out solutions that require minimal effort to implement and do not result in too many unnecessary platform changes.
Shippers’ desire for stability and minimal change and disruption may contribute to their overall hesitancy to leave their current visibility tactics. What will it take to adopt a more radical full-service visibility solution? Visibility providers hoping to appeal to shippers should tap into this hesitance. Doing so will allow them to design minimally invasive solutions. In turn, this will allow shippers to upgrade their visibility offerings without overhauling their entire operating systems.