Eliminating drayage headaches
IT tool developed to help NVOs and forwarders better manage box transport.
The relationship between customers and their drayage providers is undergoing a shift, fueled by evolving technology, which allows for greater visibility along the entire supply chain and incorporating increasing regulatory changes. Add in the fact that many companies are doing more work with fewer people, and the market is ripe for the introduction of Xenon Freight Solutions’ online drayage management tool.
Xenon released its online booking portal for drayage services, Xenon FS, last November, a tool that emerged based on a finding that the drayage management process was inadequate for a specific segment of the supply chain, according to Xenon Freight Solutions’ director of key accounts, Stacy Lange.
Xenon’s new tool contains a vast network of compliant, screened carriers and allows customers the flexibility to find the best locations, providers and rates to fit the ocean side of their supply chains.
The tool targets non-vessel-operating common carriers and freight forwarders, because Xenon officials saw they were a large sector of the market that hasn’t historically been well served by drayage.
Lange explained the drayage industry has difficulty managing the sporadic needs of NVOs and forwarders, while large retailers and other shippers, who know their shipping volumes to distribution centers, are much more straightforward to serve. Retailers also generally have stronger relationships with trucking companies.
“The whole concept of Xenon FS was born mostly out of frustration in the availability of simple and yet robust tools for managing drayage,” Lange said.
The technology has been on the market for quite some time. However, by focusing on NVOs and forwarders, Xenon has now been able to create a drayage pool, of sorts, that turns these customers’ drayage needs from volatile to stable. The technology allows NVOs and forwarders to consolidate the steps of finding the correct vendor, establishing credit, verifying pricing, checking on compliance issues — Xenon pre-qualifies all its carriers and meets the surety bond requirement laid out in the MAP-21 legislation — ordering, paying and tracking the shipment. And it puts all these drayage requests together in one place.
“By pooling all of those volumes together for the NVO and freight forwarder community… you end up having a pool that becomes less sporadic, that becomes easier to plan and becomes much more attractive to the providers in the drayage community,” Lange said.
Xenon’s tool also allows these customers to stay up to date on compliance issues and make sure every provider in their often vast networks is also following the regulations.
Lange said many NVOs and forwarders were actually shocked when Xenon showed them how many carriers that they used to move containers. She said these companies routinely use 200 to 300 different providers, with some employing up to 700.
To follow the evolving drayage market, Xenon’s IT model has also changed a bit. Lange said the company started by providing a simple online database where customers could log on and book drayage moves. Soon after that went live, Xenon started hearing from customers who wanted more integration from the drayage tool; they were already running so many systems that they wanted to add a drayage piece into their existing programs.
“Really, for them, the bigger benefit is to be able to integrate with their existing systems and make their systems more efficient and more end-to-end by offering this capability that wasn’t really part of their solution before,” Lange said. By linking the drayage tool into their existing contract management tools, she added, the Xenon program “solves one whole aspect of what they’re trying to do on a day-to-day basis.”
She added “the integration piece is really where we can add more efficiencies and really become stronger partners with our customers.”
This doesn’t mean that Xenon has abandoned its standalone Web program, which served as the genesis for the entire solution. Some customers still prefer to use this tactic, Lange said, and the standalone tool remains a method to expand to a wider customer base.
“In order to even start a relationship with any of our customers, we need to prove that we’ve got the services, so they do generally start with the standalone portal that we offer,” she said. “But then we do generally find that where we can add the greatest efficiencies to our customers is when we integrate.”
Visibility is at the heart of the Xenon FS tool. When a customer books a drayage move in the system, it receives constant email updates for every change in status. At first, Lange was unsure these users wanted so many email alerts about their drayage providers, but she found that customers prefer it if Xenon is proactive instead of making them log into the system to track their moves.
Lange said the Xenon FS tool ultimately allows customers to save time and drive efficiency, while adapting to the new drayage arena.
“The thing that I hear the most when I’m talking with them is the fact that we’re taking so much of the headache away associated with the drayage process,” she said.