Freight Capacity Demand Pushes Record Growth for the Exchange

Rising demand for freight capacity has contributed to consistent record growth for the Transport Exchange Group. With driver shortages and fluctuating seasonal peaks piling pressure on the UK’s logistics infrastructure, the company has seen the number of loads expand exponentially.

Couriers, owner driver operators, hauliers, freight forwarders and logistics providers are now looking to the platform to help asset utilisation and maximise efficiency. These factors have seen the membership of Courier Exchange grow to nearly 6,000, creating a virtual fleet in excess of 44,000 vehicles collectively.

Through the platform, members are connecting with other like-minded businesses to make the best use of available resources and increase capacity during peak trading periods, maximising and expanding operational capabilities where required. This improved collaboration is enabling both owner drivers and fleet operators to reduce empty running to a significantly lower figure than the current national average of 30%.

The value of the Exchange can be further highlighted by the engagement and feedback rates, with 97% per cent of members active on the trading platform every day and an overall job satisfaction rating of over 99.1%. Moreover, with over a third of all transactions having feedback ratings, users are benefiting from a comprehensive measure of fellow member performance.

Director of Transport Exchange Group, Lyall Cresswell commented: “These latest figures reflect our successful and proven track record to tackle some of the most common and difficult challenges facing the road transport sector. Our members are able to identify, develop and maintain lasting relationships with partners, subcontractors and owner drivers to create trusted networks, which maximise and expand capabilities where required. This is helping to meet their business and operational needs, boosting efficiency and ultimately increasing profitability.”

Much has been said over the past few years about the ongoing driver shortage issue that faces the road transport sector. The issue has been exacerbated by CPC training requirements and an increase in demand during peak periods, like Christmas. On occasion the problem has even made it into the mainstream press, with talk of empty shelves and understocked distribution centres across the country.

However, there have been few tangible solutions put forward to tackle the potential impact on capacity in the UK supply chain within a reasonable time frame, or that don’t require a fundamental change in the perception of the industry by would-be new drivers. Initiatives designed to attract new blood to the sector, even if successful, have not proven to have much impact in the short term. So what are operators expected to do in the meantime to overcome this skills shortfall?

There is certainly no single answer, but improved collaboration within the marketplace has the ability to deliver fast results, by maximising efficiency and utilisation from within the existing fleets of UK road transport operators.

Recent UK Government statistics show that more than 30% of HGV miles are driven without a load, figures that demonstrate a consistent increase over the last decade and a half. In terms of international transport (EU-28 level) the figure is around one-fifth. This suggests that much of the required capacity does exist in the UK, so the challenge is finding an effective means of tapping into this under-utilised resource.

Of course challenges exist and not all empty capacity will be accessible by any means. But companies do have the opportunity to achieve more by having an open mind-set based around collaborative efficiency, as long as they are able to access the necessary mechanisms for sharing information and working together. Freight exchanges have been helping road transport businesses to fill empty vehicles and trailers for a number of years by facilitating a valuable supply of back loads. Recent developments are making interactive co-operation between trusted business partners even more achievable.

Whether through providing access to the general transport marketplace or a more restricted closed user group of known trading partners, a freight exchange platform like Courier Exchange (www.courierexchange.co.uk) can help connect operators to take advantage of back loads and other available resources at any given time in the market. This approach also provides immense scalability to flex activity up and down where required. It encourages users to not just trade together, but act collaboratively by providing the technological, billing and administrative support to develop trusted relationships and share the necessary operational data.

Furthermore, with the ability to integrate with complementary supply chain systems, including vehicle telematics, freight exchanges are increasingly becoming a central hub that connects people, assets and data. By embracing and combining with the latest technology innovations and other essential business and operational tools, it is becoming possible to create trusted networks, boost operational efficiency and increase profitability (through lucrative back loads, for instance) simply by being better connected.

Integrating a freight exchange with vehicle telematics systems provides an effective way of increasing levels of trust, as well as achieving complete confidence that any goods or back loads will be picked up and delivered on-time while meeting expected service levels. By making the live vehicle tracking data viewable directly via the freight trading platform, accurate location and status information of goods in transit can be shared between trading partners and customers in real-time. Meanwhile, it is possible to match precise vehicle locations with already posted back loads, or receive email notifications of new jobs that are suitable based on current or planned positions.

Freight exchanges can offer a highly flexible, responsive and simple to use solution that enables haulage and logistics operators to quickly and effectively share information about back loads, capacity and available work. All of this is making it easier to fill available space, eliminate wasted capacity and maybe just ease some the burden many operators are facing as a result of driver shortages.

There is often a view that the road transport sector is simply not set up to collaborate, but it has been robust enough in the past to adapt to changing market conditions. What is clear is that operators need to find and deploy all of the unused or under-used latent capacity within the market if they are to meet growing demand, so effective collaboration could be the winning ticket.

For anyone who works in the logistics industry, from fleet managers and freight forwarders, to hauliers and those who make a living doing courier jobs, the IMO (International Maritime Organisation) 2020 sulphur cap is set to have ramifications on costs and feasibility.

Even if you don’t travel outside the UK for your courier jobs, there’s little doubt you’ll be affected indirectly, so it’s important to understand what it’s all about. 

In 2015, the European Union and International Maritime Organisation issued a directive requiring ferry companies to lower the sulphur percentage in fuel from 1%, to 0.1%, with a view to decreasing their carbon footprint and, ultimately, helping to improve air quality in Europe. (The directive affected areas including the English Channel, North Sea and Baltic Sea regions.)

Because ferries had to make significant changes to their fuel systems in order to comply with these new regulations, the ferry companies were left with little choice but to pass the additional costs onto their customers.

This scenario is about to be repeated with the IMO 2020 sulphur cap, which is set to come into effect in January 2020. The global environmental regulation is designed to significantly reduce the sulphur content of fuel used by ships to no more than 0.5%.

As with the previous EU directive in 2015, ferry and ship operators have several alternatives to reach compliance, all of which are costly and the results are not entirely clear. What is clear, however, is that, once again, the costs will necessarily have to be passed on through the supply chain. The options are:

Investing in new engines or ships with dedicated technology.

Switching to a more expensive reduced sulphur fuel.

“Scrubbers” can be fitted to clean the output gasses: these are similar to a catalytic converter in a car. This system cleans the gasses generated by the engines, which enables the ships to continue burning lower grade fuel with far lower sulphur output levels. The scrubbers are retro fitted, but are extremely expensive (a cost of around €5 million per ship) and are not compatible with all vessels.

The final option is to burn cleaner fuel – Marine Gas Oil (MGO) instead of heavy fuel oil (equivalent of super unleaded for cars), which is much more expensive.

For anyone undertaking courier jobs, whether in the UK or beyond, this environmental regulation will have long term and far-reaching effects as shipping companies adjust their business strategies. For freight forwarders, the costs that are passed on for the transportation of goods will be reflected in their own operational practices, which will affect how they buy and manage their road capacity.

In order to maintain the professional standards that are expected on the Exchange, we would like to remind our owner drivers and fleet managers about the rules concerning the use of passenger cars and other ‘non-standard’ vehicles when undertaking work between member businesses which were updated a few years ago (this update does not affect car-derived vans).

1. As per the existing guidelines, the vehicles used by owner drivers for Exchange work should be fully insured including relevant hire and reward policy and should be clean, presentable and properly maintained. Generally speaking we, Transport Exchange Group, expect members to use a recognised commercial road transport lorry or van for Exchange work (this includes car-derived vans). If you intend to use anything which we classify as a ‘non-standard delivery vehicle’ for a job that has been sub-contracted to you as an owner driver or manager via the Exchange, then you must obtain written permission from the company for whom you are undertaking a delivery prior to pick-up.

A ‘non-standard delivery vehicle’ includes (but is not limited to) the following:

•         Any un-liveried passenger car/MPV/4X4

•         Coach / mini-bus

•         Any other type of converted vehicle that has not been specifically converted for use in the road transport industry

We are asking our members to use common sense when sending in a vehicle on behalf of another member.  If it is not a standard courier van or truck that is being used then it is very likely that it will fall into the non-standard delivery vehicle category and therefore require permission from the member that has sub-contracted the job to the owner driver or manager as to whether it is suitable or not.

2. As of the 1st June 2014 we will no longer be accepting new subscriptions from those businesses that have only a non-liveried car in their fleet or on their insurance policy documents.

Should any member arrive at the pick-up point in a non-standard delivery vehicle, without gaining permission in writing PRIOR to pick-up, then we reserve the right to suspend their membership if a formal complaint is lodged by the sub-contracting member. We would like to draw your attention to a recent development in the Exchange which allows sub-contracting members to allocate a received booking to one of their company vehicles, this should help the transparency and confidence between members.

If you have any questions or comments regarding this update, please submit a support ticket so that we can manage your responses and act accordingly.  We will not respond directly to any forum topics on this subject.

The Accounts Payable feature allows you to manage the invoices you have received from members that have invoiced you through the system.

Once a job is completed and you have received an invoice, you can approve selected invoices for payment. When you tick the ‘Approve to Pay‘ box, next to the selected invoice the system will display the date when the invoice was approved and send an automated email to the other member confirming that you have agreed to pay their invoice.

Using the Accounts Payable feature you can confirm that a job has been completed successfully and you agree to the payment, allowing clear communication with your business partners and avoiding payment chasing calls.

Features coming soon:

From day one of joining the TEG freight exchange, AE Hancock Ltd, a haulage business based in Stockport, has reaped the rewards. The company has virtually eliminated empty capacity since becoming a member of the freight trading platform and, with a consistent increase in the profitability of the business, there’s no stopping them. They have been able to fill over 90% of their empty return loads, resulting in a huge boost in turnover.

AE Hancock realised they were not making the best possible use of their fleet, because they did not possess the necessary nationwide network of trusted partners and customers to avoid high levels of empty running. By gaining access to the Haulage Exchange’s network of transport businesses located across the UK, Ireland and mainland Europe, the company is able to secure a significant number of loads per month through the platform by listing available capacity and identifying suitable loads that match with the locations of their vehicles.

The company has developed valued relationships with like-minded hauliers on the freight exchange, including a core network of operators who are responsible for a growing proportion of the additional loads. Furthermore, AE Hancock has identified additional business prospects, so its investment strategy has been aligned to meet the precise needs of other members. For example, the company has become FORS (Fleet Operator Recognition Scheme) accredited to take advantage of increased demand for work in London, while the planned acquisition of an 18-tonne curtainside vehicle with tail lift is a direct result of opportunities that exist on the freight exchange.

The simple, responsive and intuitive nature of the platform has also meant AE Hancock is able to use it without creating any administrative burden internally. In fact, using its invoicing system has helped the company save time and streamline their billing processes. Meanwhile, the added support provided by the dedicated customer management team means that any queries are answered immediately and issues are quickly resolved.

Dawn Hancock from AE Hancock Ltd commented: “Haulage Exchange is an integral part of our day-to-day operation, supporting our ambitions to grow the business. We had previously been reliant on our customer base within the north west of England, but now have access to opportunities across the UK and internationally. The impact was almost immediate, helping us to effectively fill available capacity and make best use of our assets going forward.”

Lyall Cresswell, Managing Director of Transport Exchange Group said: “The platform offers an effective means of boosting the efficiency and profitability of its members by helping to fill available capacity and improve workload. The benefits can be seen immediately and these organisations can better control operational costs, increase margins and target business expansion by getting connected and engaged with other like-minded businesses. This proven value has resulted in a third of our members being part of the freight exchange for more than five years.”

When a load has been posted, the system will match the job with appropriate users using the following criteria:

If the pickup location falls within your home notification radius and you have the right size vehicle within your fleet or through one of your regular sub-contractors, you will be informed of the job by your preferred medium (SMS or email) as well as the notification bar. The notifiable radius in conjunction with your resident location allows you to determine the area for which you will receive local alerts for courier jobs.

To ensure you are getting useful alerts and avoiding irrelevant ones, you can specify your preferred notification area much more accurately using our handy tool. On the desktop version of the platform, go to Settings>Profile>Notifications. Click on the ‘Select Region’ option, ‘Draw a polygon’ and create your unique catchment area.

If a tracked driver/regular sub-contractor is within the stated distance (as defined by the poster of the load at the bottom of the form) then you will be informed of the available courier jobs by SMS or email.

If Return Journeys are posted for a driver, alerts will be matched on a predictive basis. The system takes about 10% of the journey length to create a corridor along the registered route. Based on an average speed of 55mph the system will work out roughly where the driver will be. If the courier jobs are ready for collection around the time the system predicts that the vehicle will be in the area, a journey notification will be generated.

If you’re looking to extend your reach and boost your profits, there are plenty of opportunities to pick up courier work for owner drivers in Europe. Members of the Exchange can use the Mobile App throughout Europe and receive the same functions and benefits as in the UK.

In 2017, new EU rules made it significantly cheaper to use your mobile in Europe. The ‘Roam Like at Home’ rules effectively ended expensive roaming charges, so you don’t need to worry about accidentally running up huge data roaming bills if you want to start taking on courier work for owner drivers in the EU. But it’s still important to read the fine print and speak with your provider to clarify.

The Government has confirmed it cannot guarantee free EU roaming in the event of a no-deal Brexit. 

If you’re looking for more courier work, for owner drivers in Europe there are opportunities waiting through the CX Mobile App.

IMPORTANT! Please call your network provider to get the best mobile phone rates and information about tariffs post Brexit. Transport Exchange Group cannot be held responsible for any 3rd party pricing. For more Mobile App news follow us on  @couriermobile