Much like the age-old “chicken and egg” debate, we may never know how the very first load appeared on a load board. Did the shipper post an asking price? Did a carrier post a bid to win a load?
But one thing is certain: Shippers and carriers need to move quickly. If a load is posted with a price and avoids back-and-forth negotiation, carriers will swoop in to pick it up. In fact, loads posted with an asking price on load boards are typically booked five to 10 times faster than those without an asking price.
Low-balling a price is risky, because it could risk delaying a shipment, as carriers pick up more competitively priced loads. While it may be tempting for shippers to gamble for the best price, it’s not always the best practice in a fast-moving industry.
That’s why it’s pivotal to provide transparent pricing on loads, to ensure your goods get to their destination quickly, securely, and at the right price. Modern technology and real-time pricing information are key, so shippers can ensure they price their loads in an optimal way, and carriers can make sure they’re accepting a fair rate.
The Bid vs. The Ask Price
Modern-day load boards can look a little chaotic. Most loads are posted without an asking price, even though that’s a surefire way to delay a load being picked up. At the moment, there are more than three loads for every dry van, four loads for every reefer, and as many as 20-plus loads posted for every flatbed on the road. No matter the type of freight, price search frictions inflate costs and inefficiencies for shippers.
Traditional price negotiation happens by phone between brokers and carriers. If you ever played a game of telephone back in elementary school, you’ll recall that things can get lost in translation. Phone-based price negotiation can create discrepancies because of miscommunications, a lack of documentation, or divergent interpretations of current market conditions. There’s a whole host of things that could go wrong by relying solely on phone negotiations and broker assessments:
- Inequitable pricing: Brokers might try to negotiate a lower rate to maximize their margin. Carriers might then accept lower rates than they deserve, diminishing their profitability.
- Reduced competitiveness: Carriers who rely solely on broker assessments may struggle to compete in the marketplace, as they may unknowingly accept lower rates.
- Damaged relationships: Relying on broker assessments without transparent pricing can strain the relationship between carriers and brokers, eroding trust and potentially hindering future collaborations.
Think of it like selling a home — but the seller has no access to the prices of other similar homes on the block and is relying solely on what a broker tells them. The same is true for carriers “selling” their services without any comparative rates or transparent pricing. The bottom line: It doesn’t make sense.
With modern solutions and real-time pricing information available, there’s no need for the telephone game. Shippers can use tools such as Farelanes to assess the price for their loads based on real-time market pricing data, and carriers can make an informed decision based on that transparent pricing.
Farelanes: Building Transparency in a Dynamic Market
Farelanes offers an innovative suite of products designed to revolutionize lane pricing and address the lack of transparency in the freight market.
We have a different idea. We stand out by gathering, sorting, and anonymizing lane data sourced from factoring companies, and cleansing this data to provide a valuable solution for industry players seeking accurate and timely lane pricing.
But we don’t stop there. It’s not enough to just offer transparent pricing. We offer real, transparent pricing in real time, not after the fact. A lot of other companies claim to offer transparent pricing. We actually do it.
Our method empowers clients to make informed decisions and create trust up and down the supply chain.
Pricing for All to See
In the fast-moving world of logistics, price transparency is key. Loads posted with an asking price enable faster booking and avoid potential communication breakdowns.
We believe everyone benefits from asking prices on load boards. But how does a shipper set the right price? With a tech solution that provides pricing data in real time.
Farelanes offers a variety of lane pricing data to meet your specific needs:
- Silver: Unlimited line haul rates for city fair, up to three favorite lanes, and up to 27 trailer types. Farelanes Silver gives you the information you need when you need it.
- Gold: When you need more, upgrade to Farelanes Gold…everything silver offers, plus export level II detail, lead times, fuel surcharges, and much more.
- Bulk Data Publishing: If you already run your own backend data system, our Bulk Data Publishing allows you to plug our feeds directly into your system, giving you unlimited favorite lanes, charts and graphs, miles, export data, and much more, via a flexible API that can adapt to whatever you’re running now.
Farelanes is committed to transparent pricing. Get in touch today to discuss which service is right for you and how we can avoid the back-and-forth of broker-carrier price negotiations over the phone.
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