The Impact of Network Platforms in Final Mile

Let’s imagine for a moment that you have a vacation condominium in Florida or Arizona for the purpose of escaping the dreaded cold winters up north. Perhaps you really do have one. But if you don’t, dream along with me. I don’t have one, but I can dream too. We all love to enjoy a little warm weather and “get away” from the cold, right? And since we are imagining, let’s pretend we don’t have all the money we need, so in order to financially make two homes work, we decide to rent out the condominium in the months we aren’t using it. This makes good financial sense.

By renting out your condo for Spring Break visitors and summer vacationers, the income will help offset the overall cost of the place, including maintenance costs and HOA fees. But how would you go about finding suitable renters for your rental? You could place an ad in the local newspaper, but we all know that isn’t very practical. We likely would tell our friends and family so they might use it, but that is a limited audience. Additionally, they are most likely going to want to use it free or at a significant discount. They are friends and family after all.

I believe that the following is what you are most likely to do: Like many others, you would sign up with VRBO and/or Airbnb and list your rental there. We all know those are the main sites where travelers and vacationers go to find suitable places to rent. Those websites are known as Network Platforms. They have a network of providers (owners of property) wishing to rent their places, as well as a network of users who are seeking properties to rent. The platform is a friendly, easy-to-use website where one can search and filter to find properties that fit their renting requirements. Likewise, you as an owner can list your available properties along with its details including the rent you are seeking. 

You also might consider listing on Craigslist, Facebook or other sites, which are also considered Network Platforms matching users and providers for the purpose of exchanging information or sharing goods or services available. However, those Network Platforms are typically used for broader applications, whereas Airbnb and VRBO or Home Away are specifically used to match provider and user of temporary rental or vacation property.

Network Platforms enable tremendous efficiency and time-savings when trying to match providers and users of various goods and services, or even simply the sharing of information between providers and users.

So how would a Network Platform apply to the local and last mile logistics sector? 

Network Platforms excel when working with large and fragmented audiences; that is, users and providers. The local and last mile industry qualifies as it is the second most fragmented sector of the transportation industry comprised of over 7,000 local and last mile providers. Additionally, many shipping parties are seeking to find and electronically engage local and last mile carriers

By connecting users and suppliers, or shipping parties and carriers, through a technology platform, both enjoy great efficiency in finding each other and engaging in business transactions. But the benefits don’t stop there; there are additional advantages as well. Local and last mile carriers can use a Network Platform to promote and market itself so that shipping parties are made aware of them. Shipping parties save significant time and energy in finding carriers that match their need and ensure they can be electronically connected. Any smart business is going to market themselves in a variety of ways and through a variety of channels. While a local carrier should have direct sales, participating in a Network Platform increases exposure and likelihood of engagement by shipping parties.

Good Network Platforms are much more than a directory. They avail themselves to enable efficient engagement. Network Platforms can do this using nothing more than a website such as Airbnb, VRBO or even Uber, while other Network Platforms enable deeper engagement by electronically integrating parties for long-term relationships. Few want to engage manually by phone, email or a local carrier’s website. With the plethora of Transportation Management Systems, shipping parties far prefer to electronically connect and engage their carrier partners into their systems and automate processes.

Other benefits are that Network Platforms don’t assess fees until business is conducted. They typically don’t require subscription or ongoing fees. The parties transacting business via a Network Platform can access data and derive value from reporting and historical data.

There are some differences in Network Platforms. Some are simply connectivity “pipes” to connect parties, while others go deeper to help match shipping party and carrier together. There are others that provide niche services. One should investigate each type to see which is a better fit.

Regardless of variety, it makes sense for carriers to participate and work with multiple Network Platforms. Imagine if a retailer only accepted Visa. They would limit payment options, and likely frustrate Mastercard and American Express users. These payment systems are Network Platforms with consumers as users and merchants as providers. The same principle applies to local and last mile Network Platforms. The more you participate, the more likely one is to win new business. And by minimizing manual engagement, local and last mile carriers can operate more profitably by avoiding manual engagement and data entry.

5 String Solutions is a Network Platform electronically connecting local and last mile carriers to shipping parties. In addition to its Bridge connectivity hub, 5 String Solutions helps shipping parties find and match the local and last mile carriers that might be best suited to them. 5 String Solutions enables electronic connectivity between transportation trading partners. We specialize in real-time data exchange including real-time shipment visibility. In today’s ever-changing world of logistics, real-time data exchange enables the shipping customer to get the experience they have come to expect.

If you are a local or last mile carrier or a shipping party and not engaging your trading partners electronically with real-time data, there is a better option for you.

To learn more contact:

Paul Steffes                                                                                  Jim Bramlett

[email protected]                                                      [email protected]

610-613-0971                                                                               913-944-2407