How Digital Freight Brokers Compare to Traditional Brokers

by RoadSync | December 28, 2021

The transportation industry has been shifting into a more digital world in recent years and continues to do so. Freight brokers act as an intermediary between a shipper who has goods to transport and a carrier who has the capacity and the capabilities to move that freight. The broker deals with shippers and then facilitates the shipper’s freight movement. Freight brokers directly communicate with carriers to keep track of a load hauled and update the status to the shipper. 

Traditional brokers have been long-standing and successful in delivering value. Still, with technology changing the game in every industry, the transportation industry is always looking for new ways to keep its processes and logistics more efficient. As a result, digital freight brokers have recently entered the market, changing the business model for brokerage. Whether a digital or traditional broker, shippers need intermediaries to manage their freights, and they now have more options than ever before. Let’s explore the differences between these two broker types.

 

Traditional Freight Brokers 

Traditional freight brokers have long been successful in helping shippers find reliable and cost-effective carriers. They work with companies to reduce transportation costs and decrease the time it takes to get a shipment from the shipping point to its destination.  While digital freight brokers are becoming increasingly popular in the transportation industry, technology rarely eliminates the need for human resources. 

 

Many people prefer traditional freight brokers because they provide personalized customer service that technology and software can only try to duplicate. Freight management isn’t one size fits all. Traditional brokers are trained to customize customers’ experiences based on their specific needs. They have more experience managing shipments and deliveries to cater to customers’ particular needs. Traditional brokers are prepared to deal with any inconveniences that can arise, like time changes, truck issues, and more. 

 

Digital Freight Broker

Digital freight brokers use an automated brokering process that enables shippers to adapt to market changes, especially during Covid-19 quickly. They offer shippers real-time pricing and capabilities made possible through machine learning that evaluates load combinations, match shipments with suitable carriers, and consolidates shipments for a more efficient experience for both shippers and carriers.

 

Maintaining relationships with multiple brokers used to be the only way for carriers to gain visibility of available loads, but the digital industry has changed that by providing all carriers access to all freights. Digital freight brokers have become popular with small businesses that don’t have the resources or experience. These brokers get them trucks, a driver, a more reasonable price, and timely delivery that they might not have been able to find on their own.

 

The digital freight brokerage algorithms are designed to efficiently connect the proper loads to suitable carriers as more shippers join the network. Carriers and shipments are paired based on origin, destination, time, load capacity, and type through the digital freight brokerage algorithms. Automating matching leads to drivers allows shippers to reduce the labor, cost, and time traditional efforts require. While the algorithm quickly connects shippers and carriers, it isn't always guaranteed to be effective and trustworthy. For example, if a company requires temperature-controlled trucks, a digital broker may only be able to secure vans or flatbeds, thereby not meeting the shipper's needs. 

 

When it comes to logistics, there are many options, and RoadSync is here to simplify the process and better serve our customers. Learn more about RoadSync Advance, our dedicated payment platform built for Brokers and Carriers.