In today’s competitive market, freight brokers face countless challenges including keeping up with constant change in the market, evolving customer expectations, and slim margins. To remain relevant and profitable, brokerages must adapt, and in today’s tech-savvy freight market, that often means adopting technology to become more efficient, more profitable, and more customer service-oriented.

The difference between profit and loss can hinge on the accuracy of a broker’s freight pricing and bids and how quickly and efficiently they can get those bids to customers. That’s why…

Freight Pricing Can Make or Break a Brokerage

The big guys are using auto-bidding technologies to stay on top of the competition, generating bids in record time without absorbing a lot of manpower. This strategy is working for them for several reasons, some of which are simply the issues other, smaller, less tech-savvy brokerages face when bidding. These issues are some of the main reasons your brokerage needs intelligent pricing.

Pricing is Unpredictable

We all know the freight market can be volatile. Ups, downs, and everything in between can occur within a matter of days, and the information in routing guides can be days, weeks, or even a month old. Various factors like diesel prices and available capacity versus the number of loads in a lane keep market rates and the rates brokers will pay for a load constantly shifting, and shipper sales teams are often working with outdated data.

In many brokerages, the shipper sales side is bidding loads while the carrier sales side covers them. A disconnect between these two departments can lead to missed opportunities when shipper sales don’t know where they can bid more competitively than the market because carrier sales can easily cover the load.

Freight Pricing Is Time-Consuming

Pricing can take up a lot of time. There are a lot of factors that go into pricing a load accurately not only according to the market data, but based on what a broker will likely pay for the load based on their unique carrier relationships, capacity in a given lane, and the specifics of the load itself.

Some brokers often use market rates when bidding to try to speed up the process, and while that may work, it may also lead to a brokerage losing out on margins when they win a bid or business when they don’t.

Conversion Rates Suffer

When a broker doesn’t bid quickly or accurately enough, it’s almost a guarantee that they’ll struggle to convert their bids into loads. Either someone got to the customer first with a reasonable bid or the customer was willing to wait for bids to roll in and someone bid lower. Now, whether the broker that bid lower could really afford to do so is another question entirely, but the result is the same.

The broker loses out on the load or loads. Their bid didn’t convert for whatever reason.

It’s Difficult to Gain Visibility into Bidding

Visibility is a constant battle for businesses in general and freight brokers specifically. There’s so much data and it’s siloed in so many different places due to the complexity of operations and the different technologies used to keep them running. It can be difficult to track things like your available capacity in a lane, what you’re bidding and to whom, and how those bids are performing.

Lack of visibility hinders a broker’s ability to strategize. They can’t easily see which lanes they would be most profitable in based on their capacity and experience, how much to bid based on their capacity, and they eat up time as they try to gather data from various sources to make smart decisions for their business.

Advantage Can Help Brokers with All These Bidding Pain Points

Parade’s Advantage pricing tool goes above and beyond other pricing solutions on the market to generate fast, accurate bids based on not only real-time market data but also their unique carrier relationships and available capacity. They can automate the bidding process so that the broker can respond to more requests for bids and never miss out on an opportunity. Enhanced visibility means brokers can see what’s happening with their bidding in real time and adjust their strategy on the fly.

Advantage offers precision pricing tailored to your brokerage's unique capacity, giving your brokerage a sustainable competitive edge, all the while helping you win more bids to grow and scale your business, your way. Want to find out more about what Advantage is all about? Reach out to our sales team here.