Savannah Transportation Industry | What is Electronic Freight Management (EFM)?

Posted by Port City Logistics on Sep 21, 2017 4:10:36 PM

It is estimated that domestic freight volumes will have increased by 70% over 1998 volume figures by the year 2020, which will not be possible to efficiently process and ship using our current level of physical capacity. It is crucial to the future economy of our country that the transportation industry, including the Savannah transportation industry, find ways to more efficiency move freight throughout, into, and out of the U.S.

Download Our FREE Guide to Third Party LogisticsWhenever we see the term, “electronic freight management,” we find that it is usually linked to a study that the United States Department of Transportation (DOT) is working on using a private-sector partner, the Intermodal Freight Technology Working Group (IFTWG). In the study, the IFTWG and the DOT illustrate the movements of a container, including its information flow, through a domestic supply chain on a freight process map. So far, the project results have shown that improvements to information speed, accuracy, and visibility would enable an increased volume of freight to be efficiently shipped in the future.

For electronic transfer of information to work, all of the companies involved in the supply chain of particular shipments will need to use the same cutting-edge technology. Currently, just the truck-to-air interface is the focus.

What is Digital Freight Matching?

In the trucking industry, shippers need to locate a secure, reliable carrier that has available capacity. In a “just-in-time” environment, this is done at the last minute, but the process involves a cumbersome communications process. Whenever shippers need to ship something, they contact several carriers for quotes or they use load boards, transportation brokers, or third-party logistics providers. No matter what type of logistics business that a shipper wants to use, the process requires a lot of communicating back and forth in emails or on phones.

Communications done this way is already outdated, low capacity and slow, and it won’t work much longer in a digital, e-commerce age. That is why technology companies developed the concept of digital freight matching. Digital freight matching refers to on-demand software that solves communication problems for both shippers and truck drivers.

Using this software, shippers can almost immediately find truck drivers who have capacity to ship the shipper’s freight on particular days and routes. Shippers accept or reject the offers that come in. Also beneficial to shippers is the fact that they receive better rates from drivers who utilize DFM because the DFM technology lowers the working capital requirements of drivers.

Truck drivers benefit from DFM because they know for sure whether or not there is a load waiting for them at the drop-off point, enabling them to make other arrangements in cases where there is no load. Currently, about 28% of the trucks traveling on roads are empty. DFM also enables truck drivers to upload delivery confirmations in real time on their smart phones.

What are Some of the New Trends and Innovations That are Changing the Shipping Industry?

Over-the-road trucks will have sensors that tell a digital freight-matching platform how much space is available, what the weight of the truck is with the freight it has on board, the scheduled route, and the estimated time of arrival, among other things. The platforms will then tell the drivers and their managers where freight-sharing opportunities are. Eventually, the goods themselves will be outfitted with electronic signaling chips and will communicate with trucks to find their own way to the customer’s home.

What are the Other Impacts of Networked Electronic Technologies on the Freight Industry?

In the future, electronic freight management will tie together trains and ships, as well as transportation carriages for underwater and air travel. Some ships and trucks will even operate without humans aboard. All conveyances will be part of a national and world-wide supply chain system, and this connectivity will greatly improve the efficiency of the transportation business. Businesses that embrace the new technologies will be the ones that survive.

Topics: Logistics Technologies, Supply Chain Efficiency