How Logistics is Adapting to Last Mile Deliveries

blog - How Logistics is Adapting to Last Mile Deliveries

Logistics has always been about the A to B where A was the manufacturing plant, and B was the retailer who was selling the items. However, with the rise of eCommerce and omnichannel marketing, A to B isn’t so straightforward anymore. Consumers now have the power to skip the store and have items delivered directly to them. It means, logistics and transportation providers have to find ways to make it work. In addition to having a wide variety of goods and products delivered right to their door, consumers want those products delivered even quicker than ever before.

The Last Mile of delivery is becoming a new focal point for logistics providers. So the question is, how is logistics adapting to last mile deliveries?

City Logistics

Last mile delivery is one thing, but contending with crowded streets and heavy traffic is something else altogether. Smart city logistics is just one new challenge that logistics providers will have to face. With warehousing space coming at a premium and often too far away from the city to be useful, what options are there?

One of the latest trends for warehousing space is repurposing. Across the United States, shopping malls that are falling into disuse (having been pushed out by e-commerce) are quickly being snatched up as distribution hubs for many companies. Many European cities are taking advantage of the falling car usage by repurposing multi-storey car parks into DC hubs which can provide easier access to the core of the city and reduce traffic and congestion.

Other companies are adopting warehousing models used in highly populated Asian cities like Tokyo and Hong Kong where multiple companies are sharing a single warehousing space which helps to cut down on operating costs and expenses.

New Delivery Methods

New delivery methods will also be crucial to integrating smooth last mile delivery services. Of course, everyone knows that Amazon is looking to deliver packages directly to customers doorsteps using drones. However, there are a lot of other innovations that can make last mile deliveries that much easier.

Package delivery bots are also starting to make the rounds as an automated carrier robot can deliver a package directly to a customer’s door without the need for a Federal Aerial Clearance. Additionally, there are many businesses that are bringing some new tricks to the trade. DHL and Daimler AG are working on a system that would provide a package carrier a one-time access code to the trunk of a consumer’s car, allowing deliveries to be made wherever the car is parked, whether it be at home or out and about.

In addition to new modes of delivery, there are also some serious upgrades being made to delivery trucks in general. Electric delivery trucks from Mercedes-Benz and Daimler AG have a delivery range of 200 kilometers with a payload of 26 tons, which can cut down on urban CO2 emissions. Additionally, these electric trucks could bypass the night time noise ordinance, which would allow deliveries to be made during a time of lower traffic volume and congestion in the city

Logistics Companies Get Smarter

Location and new delivery methods are all well and good, but if a logistics provider works at a suboptimal level then it’s all for nothing. To that end, many shippers and carriers are overhauling their logistics intelligence to work more efficiently

Digitalisation of freight services will play a large part in the adaptation process. As companies go digital, the gain access to a wide array of useful information and data that allows them to increase their transparency and operating efficiency. More data means smarter moves which result in less wasted time. When it comes to last mile deliveries, timing is king.

More and more companies are turning to freight forwarders like InstaFreight to provide them with the forwarding capabilities they need to get their goods from A to B. See why InstaFrieght is quickly becoming a go-to source for many shippers by visiting our website.

Learn More About Digital Freight Forwarding

DVZ Interview at Transport Logistic Munich, May 2017 with Philipp Ortwein, Managing Director of InstaFreight.

If you visited the InstaFreight booth at Transport Logistics in May, you could feel the start-up excitement surrounding it. Let alone the start-up spirit of the Instafreight team. Indeed, even the Managing Director, Philipp Ortwein, got his hands dirty hanging the LCD displays, installing the computers and more.

As a newcomer to the logistics space, InstaFreight began operations in June 2016. In the short span of existence, it has received such recognitions as recently winning the Eco Performance Award, a great honor for the team. Last year the team successfully validated its idea to the market, using the MVP (Minimal Viable Product) approach to test its hypotheses. The project was funded by Rocket Internet, who incubates and invests in Internet companies with proven business models.

“Rocket Internet helped us to get the product done in a record short time. We couldn’t have done it without them.” – Philipp Ortwein

InstaFreight has digitized the booking and management of road freight haulage process. Starting at order receipt, through transport allocation and finally, the delivery. Shippers create a delivery order directly on the website and receive a quotation for the complete door-to-door delivery right away.

What’s It All About?

According to Ortwein, “By visiting our website, our customers can directly establish a loading location and a destination; define it as a full truckload (FTL) or even just three pallets to be delivered, and based on the information an algorithm calculates the freight rate. To always provide our customers with competitive market rates the algorithm takes various surcharge factors into consideration and delivers the calculated results with a simple click of the mouse. For instance, an FTL from Hamburg to Munich costs 750EUR. As easy and fast as that.”

Once a rate is established, the customer can book the transport at the given rate. Meanwhile, InstaFreight automatically allocates the scheduled shipment via its app, to one of its 3,500 partners for acceptance, pick-up, and delivery.

Thanks to the app, customers have complete transport visibility and receive regular delivery updates as well. The app provides transparency throughout the entire delivery process for all involved parties including the client, the supplier and the recipient.

Instafreight is not only a load exchange platform, but a contract partner for its customers and carriers – In other words, a one-stop-shop, a digital freight forwarder for EU road transport.

“We are the freight forwarder, the contracting party for our clients. We are not just a place where supply meets demand, but a real logistics service provider.”, according to Managing Director, Phillipp Ortwein.

Things are moving full speed for the company. Since February 2017 the entire freight forwarding process is covered by the software. Now all the transport orders on Instafreight are handled digitally, from booking to final delivery.

Looking Ahead

What’s ahead? Currently, Instafreight is focusing on land haul; however, it has plans to roll-out potential multimodal solutions. Ortwein notes, “In the start-up space you learn quickly that you better focus on one problem-solving first. When you prove to be a real solution for that area, you step forth to the next pain-point. Exactly that is our approach. The next natural step could be for us to enter the sea-container business, where land delivery is involved in each case.”

The company is unstoppable and is also scaling-up. The number of delivery orders cleared on the platform is doubling month on month.

No wonder that Instafreight is among the most promising logistics start-ups in Germany and its business model has attracted Cargoline’s attention – the well-established groupage delivery platform – to initiate a cooperation between the two companies. The collaboration will create a win-win situation for all, Instafreight, Cargoline and most importantly shippers who are using the platform and services.  

Find Out More

Find out more about InstaFreight by visiting our website as well as follow us on Twitter and LinkedIn for the latest news.

 

 

E-Commerce Drives Growth for Trucking

Estimated at over €500 billion by Ecommerce Europe, the European e-commerce market is growing about 12% year-over-year. The German e-commerce market is among the largest in Europe. According to Eurostats, in 2016, 14% of total revenue in Germany was from e-commerce. This growth has not only caught the attention of small parcel providers and post offices but also trucking businesses throughout Europe.

Screen Shot 2017 06 06 at 11.16.56 AM - E-Commerce Drives Growth for Trucking
Source: ItalyEurope24: http://buff.ly/2sOHA8p

LTL Use on the Increase

A director for a trucking company commented that surging demand for same day and e-commerce delivery is reshaping the trucking sector and that less-than-truckload shipments are becoming an increasingly important part of the shipping industry.
Indeed, less-than-truckload demand will likely continue to grow for the foreseeable future across Europe as more warehousing facilities are built closer and closer to the final customer. In fact, property broker, CBRE, noted that 2016 was a record year in leases for the region increasing from 205 million square feet in 2015 to 230 million square feet in 2016.

It’s all about speed and while LTL moves are designed for shorter deliveries, sometimes that’s not even enough. Certain solutions exist such as pool distribution for even speedier deliveries. Pool distribution can be described as the consolidation of freight going into a region/country and then a local delivery company handles the final delivery. Shipments can be as small as a single parcel or as large as a full truckload.

Drop shipping is another method to reduce delivery times. Drop shipping simply allows manufacturers to move goods directly to the business without going through the usual distribution channels.

2-Man Delivery

In addition, 2-man delivery services are on the rise as larger items such as mattresses, refrigerators and exercise equipment are ordered online. Many of these delivery services include not only delivery but also set-up and, if needed, removal of older items.

In its typical manner, Amazon confirmed it is testing the two-man delivery of major domestic appliances and furniture in Munich. Until recently, Hermes Einrichtungs Service and DHL Home Delivery were responsible for the delivery of such large items sold by Amazon.

According to E-Commerce News Europe,  there are about 40 shipments a day from its distribution center near Munich that require two-man delivery services. For removals, Amazon utilizes a recycling specialist.

Managing the Shipments

Online freight platforms continue to proliferate the shipping market; however, not all are the same. In fact, many are focused solely on the carrier to pick and choose orders to delivery. While there is a great need for this, it meets only part of the market needs.

E-commerce is speeding up commerce as we know it. As a result, shippers are steadily in need of transportation options whether a LTL provider, a van or another type of transportation for delivery of goods. Often, the shipper is not sure of what a “good rate” is and as a result time is wasted negotiating with carriers. For carriers, capacity and route optimization is critical in the highly competitive freight market.

Indeed, speed is the new mantra for delivery, whether it is booking and tracking shipments by shippers or for carriers receiving payment in a timely manner. With speed also comes transparency for both the shipper and the carrier throughout the entire booking and delivery process.

To address this need for speed and transparency, InstaFreight has created a unique service that allows shippers to book shipments from carriers that have already been vetted in terms of service levels, capabilities and insurance. For carriers, an app has been created and provides a useful tool for load availability and payment solutions.

No longer is there a need for shippers and carriers to spend time negotiating rates either. Instead, rates on InstaFreight are fixed and calculated by a unique algorithm that are fair to both shipper and carrier. In other words, InstaFreight allows  shippers and carriers to focus on their core services while it manages the transportation and payment process. Indeed, in this environment of “I want it now”, InstaFreight can meet the challenge while benefiting both the shipper and carrier. To find out more, please visit our website.

Digitalization of Road Freight

Loading place  4 - Digitalization of Road Freight

“If you show me a market with information asymmetry, I’m going to show you a $1 billion opportunity.” Oskar Salazar – Uber co-founder said. Well, road freight seems to meet the criteria of Mr. Salazar. The last frontiers not touched by the internet is the Supply Chain. Inventing online software solutions for logistics is like working for Google or Amazon in the ‘90s. The industry is still using old-school methods of communication and lacking information transparency. It’s exciting to observe the shift as old-school shipping methods like phone, fax, spreadsheets and whiteboards become a thing of the past.

The rise of online freight marketplaces, and not only open load boards, but lately closed or “exclusive” communication platforms that enables 3PLs to win transparency in terms of sub-contractor’s capacity/availability and rates, shows a clear tendency of logistics digitization.

As we know, goods transportation (freight transport) is globally the largest industry (considering the generated turnover) as road freight is involved in each door delivery. Currently, tractor-trailer trucks, driven by more than 1.6 million drivers, carry 60% of freight moved in the United States. In the EU-28 as well, clear majority of the freight is moved on road.

Assets like trucks and trailers can easily be produced and purchased. The road freight industry’s bottleneck is the lack of well-trained truck drivers, since a decade now. This kind of service cannot be outsourced to China. In Europe – because of the gap between Western and Eastern labour costs – we observe the growth of Easter-European freight truck fleets and the rise of Polish, Hungarian and Romanian hauliers. The sector’s growth is globally fastest in Central and Eastern-Europe, about 7% a year.

In other words: logistics is a most interesting market for tech companies and financial investors. Digital innovation in logistics is a hot topic these days. Just to proof that, here are 3 major areas where there are heavy movements:

Freight data transparency

The most valid innovation comes from customer requirements. Visibility of and easy access to cargo delivery statuses is a typical wish of a customer. Transparency is desired not only for track-and tracing of the cargo, but for comparing freight rates and service quality when booking a transport capacity on a freight truck, vessel, plain or rail waggon. Yet, the industry is using old-school tools: phone, fax, email, load boards and various telematics systems to book and then track a shipment.

Not InstaFreight. Instead, InstaFreight’s unique app allows users to receive an instant quote and  to book shipments online. As soon as the user hits the submit button, track and trace capabilities take charge providing the user full transparency, anytime, anywhere.

Meanwhile, freight brokers are only as good as their carrier pool. On the other hand, freight clerks have only limited information about the truck availability of the hauliers.

New tools of communication are crucial here. While big players like DB Schenker and UPS have acquired software companies to pair shippers with truckers. A host of digital freight forwarders such as InstaFreight are providing innovative tools and methods of creating a high-quality partner-networks, maintain a better communication between shippers and carriers and provide available freight capacities at any time.

Mobile Applications and Telematics

Telematics have been around for more than two decades now. These systems include an installed on-board unite and a desktop or online software. Fleet management is getting complex if we consider the wide range of telematics providers on the market. In EU there is a long list of such providers including Trimble, Fleetmatics Group, TomTom, MiX Telematics, Actsoft’s, Ctrack, Daimler FleetBoard, KORE, Masternaut, AirIQ etc.

Freight Forwarders are struggling when it comes to track-and-tracing. Freight clerks are facing 70+ different GPS telematics systems in their sub-contracted fleets. For improving tack-and-tracing information transparency, some companies combine “built-in-gadget-based” telematics with mobile-app-based tracking.

But it has never been easy to convince blue-collar workers to use IT. To make smart phone applications attractive to truck drivers, tech companies have built not only user friendly applications, but useful ones. There are hundreds of Mobile Application for truck drivers out there; for route and mandatory-rest planning, for checking weather conditions and petrol prices alongside the route, CB radio-like chat APPs, CMR scanner and document handling.

There is one more frontier in EU, where telematics is involved. Bringing toll payments on one platform in all EU member countries is a current topic. EU leaders are talking about standardisation of the national highway toll systems. In Hungary for instance I have heard about a project where telematics was linked with toll payment. “Together with e-track Informatics, an auditing services provider for toll management in Hungary, Daimler FleetBoard is the first OEM telematics provider to enable electronic payment for toll roads based on FleetBoard data.”

Truck Innovation

Autonomous vehicles surely bring some benefits for the B2C segment, but if we take the long-lasting truck driver shortage in US and EU into consideration, the idea of driverless trucks make trucking companies extra exciting.

Some enthusiastic funders see a future where robot trucks move freight across the country and around the world. Due to the fact, the truck driver’s added value is much more than just driving the semi from point A to point B.

Other technologies though could become a standard very soon. Connected vehicle technology linked with semi-autonomously driving heavy-duty-trucks makes platooning possible. The trucks link up to form an aerodynamically optimized platoon and can expect an average of 7% fuel savings per truck while in an aerodynamic two-truck platoon. The technology has good chances to became a standard on new truck feature list.

Fuel-efficiency has always been a crucial topic in cargo-freight. Alternative truck power trains follow the trends in passenger car segment. Electric vehicle and hybrid technology are the keywords in trucking too.

We are experiencing a massive technology shift in road freight industry, which promises a much leaner and more sustainable supply chain including improvements in customer experience, costs and efficiency.

Be part of the change, innovate, improve, serve better.

At InstaFreight, we are doing our part by offering a simple to use online interface for shippers to book and track shipments without the hassle of back and forth negotiations with carriers.

Furthermore, we pride ourselves as a sustainable option within the European road freight market having just become the first startup to win the prestigious Eco Performance Award in which DKV honored InstaFreight for its ability to eliminate empty runs and customers receive fair treatment because of the binding bookings.

 

InstaFreight Wins Prestigious Eco-Performance Award

2 - InstaFreight Wins Prestigious Eco-Performance Award

Two goals that every company must strive for to be successful are sustainability and efficiency. Whether it is finding a more efficient way to communicate or cutting down on packaging, sustainability and efficiency go hand in hand.  Working towards a goal and actually achieving it do suffer from a wide degree of separation. Especially, when you’re trying to manage a large scale operation like a supply chain. Efficiency and sustainability are very much reachable goals, especially when you consider the possible impact digitization can have on the supply chain.

The Perks of Going Digital

As technology grows, so does our capacity to realize its full potential. With veritable torrents of data out there, it’s a matter of knowing what to look for and knowing what to do with the information. For many companies, this can be an overwhelming task on itself. Not only is accessing data time consuming, but combing through it to find something useful can be both difficult and expensive.

To that end, many shippers and carriers rely on 3PLs and Freight Forwarders to provide them with the information they need, when they need it. Timely access to data can create many opportunities to increase efficiency and sustainability.

An Award Winning Startup

More shippers are incorporating sustainability into their requirements when looking for service providers. A digital forwarder is one such option. They help customers track data to improve performance metrics, collaborate, book and more all online. With that said, deciding which one to work with can be tricky. So why not let the accolades speak for themselves?

Indeed, InstaFreight won the prestigious Eco Performance Award 2017. The Eco Performance Award is the leading European award for sustainability in the transport and logistics sector. It is led by an expert jury of renowned industry representatives chaired by Prof. Dr. Wolfgang Stölzle from the University of St. Gallen.

The group evaluates companies in 3 categories:

  1. Small and medium-sized enterprises (SMEs),
  2. Large companies
  3. Start-ups

The aim is to find businesses that not only concentrate on the classic core business of logistics, but also strive for innovative approaches to sustainability.

As noted from our press release:

The winner in the “start-ups” category – InstaFreight GmbH – specialises in track and trace and fleet scheduling, i.e. vehicle deployment control. Clients can digitally book transports immediately on a platform. InstaFreight achieves ecological benefits because its range of services lead to improved capacity utilisation. This not only saves costs, but also positively impacts the reduction of CO2 emissions. The solution also has a social aspect because the product integrates the environment of the employee (e.g. scheduling) into driver motivation.

InstaFreight’s Managing Director Philipp Ortwein summed it up for the team by saying, “We are very honored to be able to convince the jury with our digital business model.” If your company is looking to increase efficiency, become more environmentally conscious, boost visibility, or just upgrade your capabilities to keep up with the competition, then it’s time to go digital.

Environmental Concerns Impact Oil Demand

emissionen - Environmental Concerns Impact Oil Demand

The first hydrogen-fueled semi truck was introduced in late 2016. The Nikola One is powered by a fully-electric drivetrain that draws energy from lithium-ion batteries and a hydrogen fuel-cell. The Nikola One also claims a zero-emissions range of 800 to 1200 miles (1287-1931km). Since then, Toyota has introduced its own hydrogen-powered 18-wheeler which was created to haul cargo at the Port of Los Angeles.

Not to be done, Tesla is working on its ‘clean truck’, an electric one semi truck that it plans to show off in September of this year and plans are already in the works to produce 500,000 units of total vehicle production in 2018 and 1 million units in 2020.

Environmental Costs Reduce Oil Demand

But for the majority of the trucking industry, diesel still rules and remains one of the biggest costs for many trucking firms and not to mention a contributor to CO2 emissions. According to a PwC report, Germany’s road freight transport sector represented 23.3% of carbon emissions in 2015.

As such, the demand for diesel is likely to change in the coming years as the European Union imposes much tougher legislation to control vehicle emissions, which many expect to quickly erode the use of gasoline and diesel, major sources of oil demand.

The International Energy Agency (IEA) expects global oil consumption to peak no sooner than 2040, leaving its long-term forecasts for supply and demand unchanged. While demand for oil to power passenger cars, may drop, other sectors may offset this fall. According to the agency, “the difficulty of finding alternatives to oil in road freight, aviation and petrochemicals means that, up to 2040, the growth in these three sectors alone is greater than the growth in global oil demand.”

Indeed, German government statistics indicate that while oil contributes about 35% of the country’s primary energy use, this share has been steadily decreasing since 2000. In fact, most of the oil is used for transport followed by heating. Thanks to government regulatory requirements, oil’s share will probably decline further as more efficient engines are introduced and are anticipated to further reduce oil consumption to 90% of 2005 levels by 2020 and to 60% by 2050.

Price Outlook

In October 2016, The World Bank raised its 2017 forecast for crude oil prices to $55 per barrel from $53 per barrel as members of the Organization of the Petroleum Exporting Countries (OPEC) prepare to limit production after a long period of unrestrained output. Energy prices, which include oil, natural gas and coal, are projected to jump almost 25 percent overall

Meanwhile, the IEA expects demand for oil to rise in the next five years, passing 100 mb/d threshold in 2019 and reaching about 104 mb/d by 2022. Developing countries will account for all of the growth and Asia will dominate, with about seven out of every 10 extra barrels consumed globally.

So, perhaps the days of fluctuating diesel prices may soon end for European hauliers as more and more switch to alternative fuel solutions. This, in turn, could greatly reduce costs for not only themselves but also to shippers.

Find out more

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Join Us at Transport Logistic May 9-12

transport logistic munich 2017 1024x768 - Join Us at Transport Logistic May 9-12

Transport Logistic is a leading trade fair for logistics, mobility, IT, and supply chain management that has been taking place in Munich since 1978.

As the trade fair notes, “Sustained growth in e-commerce, progressive digitization of logistics processes, revolutionary impact of “Industry 4.0” on transportation and logistics: The challenges of the future are enormous. The demand for innovative products and technologies is greater than ever, with the aim to bring people, markets, and goods together in a way that is faster, more efficient, and more sustainable.”

Indeed, with over 2,000 exhibitors and 55,000 visitors from 125 countries, the event will be a great learning and networking occasion.

Transparency for Shippers and Carriers

The European road transport industry is undergoing vast changes as it looks towards solutions to address such concerns as underutilized trucks; the time it takes to agree on a rate and book freight; end-to-end shipment visibility; and timely payments to carriers

InstaFreight brings on-demand capacity availability at a fixed price for shippers as well as optimized utilization and fast payments for carriers. Along with its track & trace system, InstaFreight brings new ways of transparency for both carrier and shipper without charging a brokerage or membership fee.

As the logistics market continues to innovate, Transport Logistic is sure to be a great event with new products, technologies and systems on display. Managing Director of InstaFreight, Philip Ortwein commented “We look forward to sharing our innovative freight forwarding solution with participants. It’s a win-win solution for both the shipper and carrier”.

Find out more about us

Find out more about us at Transport Logistic.  Book an appointment or stop by our booth located at A4.327 to see our solution in action as well as to learn more about InstaFreight and how we can help you. You can also read more about previous events that we attended. For the latest news and insights on the European road transport industry, be sure to follow us on Twitter and LinkedIn.

The benefits of a dedicated fleet without having one

fleet - The benefits of a dedicated fleet without having one

A fragmented trucking market, declining number of truck drivers, diesel prices ready to jump at moment’s notice all contribute to a shipper’s decision of whether to invest in their own fleet or outsource it. Dedicated or outsourced? Both options offer benefits and drawbacks and ultimately the decision depends on the needs and costs of the business.

Likewise, a sense of stability and a steady income may entice carriers to seek dedicated fleet work. But on the other hand, the chase for higher rates and more flexibility when choosing loads may draw more carriers towards the outsourcing fleet model.

Dedicated vs. Contract Fleets

Dedicated fleets are those in which shippers hire trucks to drive only for them or operate their own private fleets. These types of fleets tend to offer predictability for both carrier and shipper. Pricing is locked in and there is a guarantee that a truck is available whenever one is needed. For trucking firms, a steady revenue stream is available.

However, a big drawback for dedicated fleets or own fleets is the cost to maintain the fleets. According to an analyst from Stephens Inc., “Trucks are getting more expensive, regulations are more burdensome and finding drivers is a pain in the neck.” So why bother right?  For many businesses, such fleets are also considered an extension of their brand as well as the perception of better customer service.

On the other hand, outsourced or on-hire fleets are appealing for those businesses that find managing large fleets of vehicles too burdensome and/or financially not viable. In addition, outsourced fleets typically benefit shippers that have more seasonal or special equipment requirements.

The best of both worlds

What if there is an option that combines the strengths of both owned fleets and contracted fleets? It’s easy via InstaFreight’s  Driver app. The app offers the predictability found in most dedicated fleets as well as the flexibility of contracted fleets.

InstaFreight guarantees capacity at all times at favorable rates which could be a drawback of contracted or dedicated fleets

Shippers are able to book shipments 24/7 through the app while not worrying about truck availability or time spent on negotiating rates. Instead, InstaFreight manages the carrier relationship ensuring reliability as well as availability. In fact, we take it a step further and provide guaranteed availability.

Furthermore, rates are determined via InstaFreight’s innovative algorithms that are fair to both shipper and carrier.

Lastly, InstaFreight handles all carrier payments within 72 hours allowing shippers to manage their core business. We only work with vetted carriers.

Find out more

Find out more about how we can help shippers and carriers alike by visiting our website. While you’re there be sure to check out our Twitter and LinkedIn pages for industry news and analysis.

Cargo Weight Declaration for EU Shippers

regulations 1024x768 - Cargo Weight Declaration for EU Shippers

The Loadstar reports that a new cargo weight declaration will be in place for EU shippers.  New regulations will force shippers to declare weight of their cargo to hauliers transporting goods within Europe. This is done to increase safety and avoid damage to roadways, bridges and tunnels.

The Safety of Life at Sea regulations, which went into maritime law last July, required shippers to provide a Verified Gross Mass (VGM) to carriers before cargo would be accepted and loaded aboard a vessel. Under the new EU 2015/719 directive, shippers will also have to provide a verified weight for cargo before it can be transported on land. This new regulation, much like SOLAS will target on shippers, rather than carriers, who are the usual focal point of new transportation regulations.  

“Shippers with goods loaded in containers and swap bodies will have to provide hauliers with what was described by Freight Transport Association director of global and European Policy Chris Welsh as a “statement of compliance”: that the weight of the cargo and transport unit added to the weight of the truck and chassis do not exceed legal weight limits on roads,” according to an article from The Loadstar.

VGM Compliance will extend to new Regulation

While the VGM caused something of a panic when SOLAS was being discussed, the EU 2015/719 shouldn’t create any additional hassle for shippers, so long as they are already VGM compliant. In short, for shippers that have already obtained a VGM via a third party when declaring ocean freight, that same VGM is also acceptable when declaring a Statement of Weight to hauliers for the domestic leg of transportation.

However, if a shipper is transporting goods solely via land channels, the provision isn’t nearly as stringent for weight declaration. “The shipper is free to decide what format the SoW should take; in other words there should be no new standard form or additional process. Existing business/contractual information will be deemed sufficient if it includes the weight of the goods,” according to the British International Freight Association. Additionally, weight verifications obtained via VGM or weight bridge are also accepted means of verification.   

Taking a Load off Carriers

The purpose of this new directive is to help cut down on pollution caused from domestic cargo transportation while increasing safety measures for trucks on the road. Member states will be responsible for determining liability in the event of noncompliance, either shipper or haulier, in instances of missing or incorrect information resulting in a vehicle or vehicle combination being overloaded. However, the true onus is on shippers to make the appropriate weight declarations before handing cargo off to the carrier and not the other way around.

“The shipper will have to give the haulier a statement indicating the weight of the container or swapbody, as well as the cargo, in much the same way as they do with the VGM. The regulation will stop a haulier being put in a position that sees him break legal road limits without knowing it,” Welsh told The Loadstar.

“This can be serious for hauliers – they can have their operating licences taken away and, although it is not a major problem in the UK, it does happen sometimes. And there are some unscrupulous firms.”

Unscrupulous or not, these new regulations will target shippers for compliance which will keep the pressure off European carriers. Additionally, the new directive, according to the EU comissions website, will also help to level the playing field between member states by “Avoiding that national operators benefit from undue advantages over their competitors from other Member States when performing national transport.”

“This directive has an important role in improving the functioning of the internal market and in ensuring the free movement of goods in Europe,” they added.

Key Points to Consider when Selecting the Right Carrier

10 Key Points to Consider when Selecting a Carrier 1024x512 - Key Points to Consider when Selecting the Right Carrier

Say you need a pallet shipped to Hamburg but are not sure who to contact to deliver it. So, you do a search online for a list of carriers and the results are enormous. How do you decide who to choose and what exactly should the criteria be in comparing the options?

This is not an uncommon dilemma that businesses face. As they grow, these businesses are entering new markets, in which their delivery partners may or may not deliver to or perhaps it’s  simply a need to utilize more carriers. However, the uncertainty surrounding the booking of freight can be burdensome for shippers particularly as they are under more pressure to keep costs at a minimum while producing and delivering goods at a faster pace. Indeed, constraints such as shifts in shipping capacity, new demands within the final mile and the worsening driver shortage are among the growing challenges facing shippers when it comes to generating efficiency gains.

Indeed, improving efficiency in transportation is a central theme in the annual 3PL Study: The State of Logistics Outsourcing by Capgemini Consulting, Penn State University and Penske, 16% of shippers agree to contracts that have a delivery timeline and specific dates. Meanwhile, 75% of shippers are interested in guaranteed arrival dates. In other words, shippers want their goods fast and by an agreed delivery time. To accomplish this, an efficient and automated process is necessary.

One such area in which efficiency is needed is the European trucking market. The European trucking market is highly fragmented, as noted in an earlier blog post, with an estimated mind boggling 500,000 carriers and all are offering varying vehicle types, service levels, shipping lanes, rates and more.

But how does one make an educated selection of carriers in a market such as this? We’ve highlighted a few key points to keep in mind when selecting one.

Key Points to Consider when Selecting the right Carrier

  1. Safety ratings – What is the carrier’s safety record? What is the carrier’s claims ratio versus its on-time ratio?
  2. Insurance – Make sure the carrier you use is properly insured.
  3. Service levels – Does the carrier actually ship goods to Hamburg or to other destinations you may need? If so, what are the delivery times? Will the carrier use their own equipment or will they outsource it to other carriers?
  4. Type of vehicle – Do you require a sprinter, a 3.5t or a 40t truck?
  5. LTL or FTL – Do you require a full truckload or less-than-truckload?
  6. Special requirements – Not all carriers can handle special cargo such as temperature-control, hazardous or dangerous goods or time critical.
  7. Visibility – Will you be able to track your shipment while it’s in transit?
  8. Payment – What are the payment conditions and requirements?
  9. Rates – As part of the agreed payment, how do you really know if you are getting a fair rate?
  10. Regulatory and compliance requirements – Is the carrier fully compliant with all government and EU regulations?

But Why Bother?

As a shipper, you certainly can spend the time needed to locate the right carrier but this approach is really not the most efficient way to utilize your time. Instead, why not let the experts take care of it for you while improving your supply chain?

InstaFreight takes care of the carrier selection, booking and payment while you take care of your business. A win-win solution for both the shipper and carrier, we carefully research and vet each carrier and monitor their performance. In addition, shipments are insured but if the shipper needs additional insurance, no problem, it can be purchased for a reasonable price during the booking process.

In addition, there is complete transparency throughout the process for both the shipper and carrier, thus improving efficiencies for each – Track and trace, determining the ‘right’ vehicle to use, special requirements a shipper may have  and more.

Lastly, the rate. Why waste your time haggling over the rate? InstaFreight has developed a unique algorithm that takes many variables into account. As a result, the rate is fixed and calculated in just seconds. Rates are fair to both shipper and carrier and for the carrier, InstaFreight ensures payment.

Find Out More

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