This is the second in a series of articles concerning the new carrier-focused Web 2.0 technology that positively impacts your bottom line while improving the services you offer. In this article, well explore how to identify these systems and expose some of their capabilities.
The Cost
Lets allay the issue of cost up front. This technology is very inexpensive. Its marketed as a subscription service, spreading development costs across a broad base of users. Just as you make money on higher volumes of shipments, these technology companies make money on a higher number of users.
Expect to pay a low (usually $100-$500 per month) subscription fee plus a modest per shipment charge of pennies per shipment. This means that unlike UPS or FedEx, who invest
billions of dollars in technology, youll have an equal, if not better, system that costs about a nickel per shipment. If you cost account per package rather than per shipment, a 10 package shipment would cost about $.005 per package.
billions of dollars in technology, youll have an equal, if not better, system that costs about a nickel per shipment. If you cost account per package rather than per shipment, a 10 package shipment would cost about $.005 per package.
The Titanic and the Iceberg
When the Big 3 (DHL, UPS, FedEx) make a change, their research and planning takes 12 months or more. They do their homework. They make sure the service will be profitable. But turning the Titanic 90 west is easier and quicker than decision making processes at these behemoths.To them, regional carriers are blips on the radar and perceived as no real challenge. But Web 2.0 systems change that. You become the Titanic's iceberg. Ten percent of your company is visible, with the other 90% residing in data and information you have in real time to reduce costs, to react to competitive threats and to generate timely and profitable business decisions. You become stealthy.
These ingeniously designed systems are not only capable of totally automating your operations, invoicing and administrative processes but are also capable of finding money you leave behind. OnTime System, in Medford, Oregon, is a case in point. Its systems not only allow an unlimited number of pricing variations, but enter a shipment's dimensions any time before invoicing, and a Dim weight is automatically calculated and billed.
Identifying Web 2.0 Companies
A website with online shipment tracking doesn't indicate a Web 2.0 company. Many software companies have been around for quite some time and simply incorporate the Internet into dated software platforms. This is exactly what the largest carriers have done, resulting in dated technology with a new set of clothes.To identify Web 2.0 companies, you have to look deeper to determine if the vendor's system is capable of significant cost reduction by seamlessly automating your entire company. Identification of these vendors may seem like a daunting task, but it's much easier than one would think as Web 2.0-enabled companies will possess all of the following characteristics.
Subscription Services
The vendor will market subscription services and not pre-packaged software. There will be no upfront costs other than the monthly subscription fee, and the services of most vendors are designed to work with your current hardware.Web 2.0-enabled companies will not provide CD software to load onto your servers.
Instead, the software required to run the applications is downloaded from the vendor's site. The focus shifts from a single server to one of multiple input devices, including PCs, web-enabled cell phones and other data capture devices. All data and information is accessed from a single source via the Internet.
Scalability
The services will be scalable, usually in the form of additional modules to which you can subscribe. The modules will build upon each other, allowing you to further automate your business as it grows. You may first start with a shipment tracking module and migrate to one that manages independent contractors. After that may be an invoicing or dispatcher module. To get the biggest bang for your buck, choose a vendor with the greatest number of applications but with the fewest modules. And since it's a subscription service, any and all softwareupgrades are included in the subscription cost. You'll always have the latest technology to run your business.
Data On Demand
You, and not the software, have total control over unique and hard-to-duplicate data sources that get richer as your volume and customer base grow. As these new systems make all the data available in real time, you decide what's important and what's not. Triggering invoicing to include a digital signature upon delivery for new customers is as simple as a keystroke. Some of the systems allow real-time, on the fly creation of custom reports, an invaluable tool for analyzing your company.
Equal Co-Development
As entrepreneurs, we all view competition as the devil when it comes to gaining new business. However, you're going to have to trust the devil, as competitors will also be co-developers in new services and programs. They won't be able to see your customers or data (as you won't be able to see theirs), but their thoughts and ideas will contribute to system development. Think of it as leveling the playing field. You'll be using the same platform, so how you use the information available to you as well as customer service and marketing will be those things that turn on new business.Collective Intelligence
Business intelligence will no longer be a topic for back room discussion. The collective intelligence of all subscribers is made available for everyone to see, but users and company names are kept anonymous. At first, this may sound like a bad idea, but consider some advantages.The Big 3 tend to beta-test new services in remote locations or at specific companies for three to six months prior to launching a product. Rather than getting blindsided by seeing advertising for a new four-hour service in your city, you could be aware of it six months earlier when they were testing in Bismarck, North Dakota. The user forums of Web 2.0 companies allow you to remain anonymous but are full of a wealth of information you can use to improve service and lower costs.
Also consider the aspects of expanding your service area and the services you provide. If you're located in Cleveland, Ohio and have identified some very profitable shipments going to Tampa, Florida, why not pick up those shipments and coordinate delivery with a southern counterpart? It's not something easily done with software-based systems, but it is with a good Web 2.0 system. Take the concept a bit further, and you can see the advantages of multiple regional carriers creating a single nationwide pick-up and delivery service with information passed between the respective P&D carriers automatically.
Customer Self-Service
Customer self-service becomes one of a series of focal points for reducing your costs. With a Web 2.0 system, your customers can place their own orders, with a single dispatcher determining driver routings for the orders. If an order needs to be changed once it's in the queue, a few keystrokes provide the right routing. And since the data is available 24/7, you can take orders at any time.Constantly Enriching Data Sources
The value of Web 2.0 data may well change your thinking and future business models. The more data that is put into the system, the richer the system becomes. And since this data is collected automatically and available in real time, you utilize a system that surpasses the carriers who are tied down with non-Web 2.0-enabled systems. With on-the-fly report creation, you'll be able to identify new directions and opportunities. The data provided is typically hard to create, even for the largest carriers. Utilize the data in the correct way, and you'll likely see business and profitability soar.
As an example, marketing mailings are usually done only to shippers. With a Web 2.0 system, you'll also have current and historical recipient names and addresses in real time. Your customer base has immediately shifted from a shipper-focused base to anyone with whom you have had contact, giving you the ability to increase your marketing presence exponentially.
This new technology is the most dynamic event in carrier transportation since barcode tracking. Without a doubt, it will become the standard for the industry in the not too distant future. In the final article of this series, we'll talk to some people who are among the pioneers in developing the technology for the carrier industry.
Bob Ferri and Rob Shirley own ExpresShip Inc., a company focused on hi-tech innovations and solutions for carriers and shippers. They can be contacted through the company's website at www.XPship.com.
As an example, marketing mailings are usually done only to shippers. With a Web 2.0 system, you'll also have current and historical recipient names and addresses in real time. Your customer base has immediately shifted from a shipper-focused base to anyone with whom you have had contact, giving you the ability to increase your marketing presence exponentially.
This new technology is the most dynamic event in carrier transportation since barcode tracking. Without a doubt, it will become the standard for the industry in the not too distant future. In the final article of this series, we'll talk to some people who are among the pioneers in developing the technology for the carrier industry.
Bob Ferri and Rob Shirley own ExpresShip Inc., a company focused on hi-tech innovations and solutions for carriers and shippers. They can be contacted through the company's website at www.XPship.com.
