Freight Brokerage: Contractual Versus Spot Freight

Wishful thinking may be turning to measurable reality as expectations for a freight market rebound percolate. From high-profile (and sometimes controversial) prognosticators like Craig Fuller of FreightWaves—who recently declared “the Great Freight Recession has ended“—to brokerage CEOs in the trenches, chatter suggests the tide is shifting in favor of rate growth. According to FreightWaves, tender rejection rates, a measure of trucking supply and demand balance, have increased as capacity has tightened, even as spot rates have climbed above prior year levels. This recent trend contrasts with prevalent market dynamics over the prior 20 months. Almost exactly one year ago, Convoy, a leading digital freight matching (DFM) platform, closed its doors amid the historically difficult rate environment. Uber Freight, another high-profile DFM platform, has also seen its share of struggles. Respected logistics investor Greenbriar Equity recently exited its structured minority position in the platform.

Against this backdrop, we return with Episode Three in our Market Digest series on freight brokerage. We highlight another central question raised by experiences during the Great Freight Recession (borrowing Craig Fuller’s characterization), as we look to inform strategy and tactics in a tightening capacity market...

For the full article click here: https://hl.com/insights/freight-brokerage-lessons-from-the-downturn-and-questions-for-the-next-cycle/