Last week, Uber Freight announced a $3.3 billion valuation upon raising $500 million in funding set aside to increase innovation on the platform. When Uber first announced the expansion into freight in 2017, there was a lot of buzz about potential for industry disruption and then a trickle in of backlash in years since from competitors as few shippers signed on. So, why should you be paying attention to this new development in the Uber Freight saga?
With this refocus on product innovation, it’s clear that Uber Freight still has a lot of big ideas on how to revolutionize the logistics industry. As the on-demand economy fueled by ecommerce creates high-pressure expectations on delivery turnaround times, similarly on-demand freight carriers have the potential to provide exceptional service and revolutionize both truck driving and logistics information systems:
A New Generation in Trucking
According to the American Trucking Associations, the age of the average truck driver is now 55 years old. The driver shortage that has plagued the industry for 152 years now has become dire as the existing workforce ages into retirement. However, Uber Freight offers a new range of benefits that attract younger workers: control to select jobs that they want, certainty of the payment up front, ability to rate clients based on their experiences, etc. These opportunities have the possibility of attracting newcomers to the industry while opening up lines of communication for all involved.
Transparent Pricing, Transparent Competition
Uber Freight has introduced transparent pricing for their goods. In moments, carriers can receive a quote and book a load. And the integrated fast payments system removes the need for invoicing and reminder emails. This instantly expands any company’s distribution network should an unexpected misfortune or opportunity arise. With its nationwide reach, these advantages will undoubtedly invigorate competition for delivery across the board and create new opportunities for 3PL and proprietary logistics networks alike.
Improvements in Supply Chain Visibility Technology
The app is set up similarly to the traditional ride share technology with automatic notifications and the ability to see your truck in real time. It also has a filing system for your business’ documents for easy access. This, plus the move away from inbox notifications for tracking information, has the capability to streamline the logistics industry top to bottom if adapted appropriately, ultimately improving the customer experience.
Ultimate Contingency Planning
By creating a platform with quick access to owner-operator truck drivers, logistics providers of all sizes can prepare to change plans with little friction should a new opportunity or catastrophe arise. Even if a shipper never chooses to use it, creating a user account with Uber Freight opens options, allows for testing against an internal fleet, keeps apprised of current events, and can save time in an emergency. All factors used to reduce supply chain risk.
Though Uber Freight has not yet shaken up the industry as initially considered in 2017, the continued investment in the platform shows promise for the app itself and as a catalyst to create competition that ripples through it. There’s a chance big change will be coming. Embracing it can give third party logistics providers a leg up in creating value for clients as partners with the service. And if it isn’t, using Uber’s insights to improve upon 3PL systems as potential partners addresses pain points that will persist regardless of one company’s outcomes.