Where do freight brokers fit into the future of freight..??
Within the transportation industry, freight has come under a watchful eye as digital disruption, acquisitions and mergers, and higher-margin business models have erupted throughout the space.
While there are various opportunities for certain aspects of the freight business, there are as many potentially disruptive factors, all which leave the future of freight foggy at best.
Freight brokers – a traditionally integral part of the freight marketplace – may find it difficult to clearly see where they fit in amongst the waves of change now and in the years ahead.
Recognizing both the strengths of the industry along with the potential setbacks is a necessary step for freight brokers who want to be successful in their business over the next decade.
Opportunities in the Freight Industry
There are impressive statistics that point to a strong future in freight, especially for brokerages that are open to embracing change. First, within the United States nearly 83% of all goods are transported by a truck at some point or another, and more than 33.8 million trucks are registered for business purposes.
Additionally, the volume of truckload is expected to continue rising with an estimated 3.2% increase this year alone.
Follow that up with industry experts anticipating freight revenue reaching $1.3 trillion per year by 2024, and it is no question that there are ample opportunities to connect critical players in the business as a freight broker.
In addition to the growth of the freight industry as a whole, freight brokers new to the business have even more opportunities in the market. Many current brokerage owners are near retirement age, and set heavily in the conventional way of doing business. The digital disruption taking place in freight has caused countless long-time freight brokers to reevaluate their position in the marketplace and their ability to keep up with ever-evolving technology needs and wants of customers.
New brokerages not only have an opportunity to acquire businesses with retiring leadership but those freight brokers starting on their own path can infuse digital tools into their operations from the jump.
Possible Roadblocks to Success
Although there are many exciting opportunities in freight in the upcoming years, there are a handful of obstacles that could impede continued success for freight brokers, both new and seasoned. The digital revolution is hitting transportation in nearly all facets of the business, from the addition of full technology stacks for drivers and customers to autonomous trucks that threaten the viability of truckers throughout the country.
These widespread shifts mean less reliance on intermediary partners, including freight brokers, and in theory, a leaner business model that increases margins for customers and drivers alike.
Currently, there are low barriers to entry on both the legal and financial sides of the line, which is alluring to technology-focused firms eager to take their bite out of the freight market share. There is no question that companies with ample capital will continue developing software and apps that cut out the need for brokerage operations in one capacity or another.
Self-driving trucks are already being tested and debated in regulatory spaces, meaning their debut is imminent. Freight brokers need to be prepared for these changes now before the world of transportation looks wildly different.
Current and prospective freight brokers can take the reins of their future in the business by understanding the opportunities in the industry along with the obstacles. Embracing the digital disruption is pertinent to future success, as it connecting with customers and drivers on a level that no automated, humanless app or software could ever achieve.
Focusing resources in these areas ensures a seat at the table of the freight future for brokers, no matter their size, niche, or current business model.