New Canadian freight rate benchmarking service launched
June 1, 2008
TORONTO, Ont. - When it comes to rate benchmarking, many carriers are understandably reluctant to share this kind of sensitive information, and even more reluctant to do so for fear of being accused o...
TORONTO, Ont. – When it comes to rate benchmarking, many carriers are understandably reluctant to share this kind of sensitive information, and even more reluctant to do so for fear of being accused of collusion.
But a new third-party service, claiming to be Canada’s first Web-based freight rate benchmarking tool, may be just the ticket to tracking just how low rates will go.
Trans-Lucent Markets announced the launch of its AccuFreight Index (AFI), Canada’s first Web-based freight rate benchmarking tool this spring.
Effective Apr. 2, 2008, shippers, carriers and third-party logistics companies (3PLs) that subscribed to the service have been able to research freight rates for shipping lanes within Canada, and between Canada and the US.
Freight rates have been submitted voluntarily by carriers who subscribe.
“We feel that this type of system is something that the transportation industry in Canada has been demanding for some time,” says Trans-Lucent president Shelina Lalani.
“Our strength currently is truckload rates however, unlike other rate management systems, we have been able to make a massive amount of less-than-truckload rate data available within AFI. We are especially proud of the ease and speed with which a member can, from their desktop, sign-in, describe a type of shipment, and receive valuable data on current market freight rates for that shipment – it all happens intuitively and results are returned literally within seconds.”
Once subscribed, members can define their searches by origin and destination, and can refine their search criteria by adding container size (for truckload searches), service level, freight class (for US-bound shipments), and “charge-by” method.
Details about equipment type and extra charges, such as fuel surcharges, can also be added to each search.
“The pool of rates we can draw on is growing daily, with more lanes and more shipment types available to be benchmarked using AFI,” says Lalani, adding there are currently over 90,000 lanes of rates entered and verified.
“We feel that this will bring a new sense of standardization and market-driven competitiveness to the transportation industry in North America.”
“It’s not about price fixing,” adds Lalani, explaining the service grew out of a demand from shippers and manufacturers to find out average freight rates.
“But it could be used by carriers to determine what the market rates are. Basically, participating carriers provide their information and members who are doing a search on a specific lane get the average price for that lane as well as the five lowest prices for the same lane.”
Shippers can also contact these carriers via the site.
Feedback from carriers so far has been good, says Lalani.
“Shippers and carriers both like it, because making calls to shippers and/or getting them from carriers is time-consuming,” says Lalani, who admits the benchmarking system won’t, however, prevent rate undercutting from happening
Depending on participation, however, it will give a pretty accurate picture of exactly what’s happening to the industry.
And plans to expand the service to include service ratings of carriers (by shippers) are in the works, Lalani adds.
So far, 140 Canadian carriers have subscribed and submitted their rate information to Trans-Lucent, says Lalani.