“When change comes knocking, some put up walls, while others build windmills.” ~ A wise Chinese saying.
And in the FreightTech industry, it is a real choice – you could either buckle under pressure and hit pause on innovation, or you could toughen up, weather the storm, and come out even stronger on the other side.
2022 was a rollercoaster ride for everyone involved in the supply chain and logistics ecosystem. The lingering pandemic, geopolitical conflicts, and energy uncertainties had the entire sector hanging on. To add to the chaos, the looming freight recession, which has now heightened in 2023, tightened the investors’ purse strings even more, causing further job cuts, putting a halt on hiring, and throwing expansion and innovation plans into a deep freeze.
As 2023 unfolds, it seems like the rollercoaster is finally finding a smooth track. The August 2023 Freight Economist by Uber Freight shows that multiple macroeconomic indicators also suggest a possible deflation in the goods market. As per the report, consumer spending rose by 0.2% in Q2 (mostly durable goods), inventories are steadying in the right direction (especially non-care items), Transatlantic trade rates are climbing, and intermodal and TEU imports are picking up steam.
However, the recent Yellow shutdown reintroduces a sense of uncertainty. This massive financial crisis looms with the potential for a staggering 30,000 job cuts, as per recent media reports. DAT Freight & Analytics, a prominent on-demand freight marketplace, also warns of an imminent surge in shipping costs, amounting to a 20% to 25% increase per pound, resulting in an overall uptick of 7% to 10%. And its ripple effect is bound to impact not only shippers, truckers, other freight transport players, retailers, and manufacturers but also consumers and, of course, the independent FreightTech vendors.
So How do you Maintain Stability when Steering through Shifting Sands?
Navigating through such unpredictability while maintaining stability and momentum is no small feat.
Take the example of Project44. Back in 2022, this global supply chain visibility provider grabbed the spotlight by scoring a remarkable $80 million in funding. This achievement propelled them to the pinnacle of the FreightTech 25 list and even earned them a sought-after spot in the Gartner Magic Quadrant. But the story took an unforeseen twist in July 2023 when Project44 surprised everyone with a major restructuring, leading to a 10% downsizing of their workforce.
In the face of such uncertainties, every freight technology leader’s mind is a whirlwind of thoughts. And let’s be honest, some of them really need urgent attention.
“How can I roll out the new product features within the limited budget?”
“How to maintain quality with fewer resources?”
“How to optimize ops and still give customers the best experience?”
“Can we pivot for new chances? What are the possible risks and costs?”
“Need to keep the team lean and upbeat.”
“Shall we innovate with partners?”
We understand the challenges you are grappling with right now – from budget constraints to a shortage of skilled workforce. Here is our take: Drawing from our own extensive experience of guiding companies through uncertain times, we genuinely believe that fostering resilience within your FreightTech operations could be a game-changer in the coming months once supply chain disruptions begin to ease. It is all about keeping the momentum going and at the same time, infusing fresh innovations to capture market share and emerge stronger than ever.
Taking baby steps today will help you optimize routes tomorrow like never before, nail demand predictions, supercharge supply chain management visibility, or innovate last-mile deliveries. Navigating the challenges of a shifting market requires adaptability, resilience, and a strategic approach to explore these openings and create value for all stakeholders in the sector.
Our Top 5 Recommendations to Build FreightTech Resilience and Keep the Focus on Continued Innovation
- Focus on maximizing margins and then growth
Imagine you are a FreightTech firm excelling in route optimization solutions. Think about the valuable insights hiding within your operations – insights that can reshape your growth trajectory. Combining your in-house data with external third-party intel paints a clearer picture: your star performers, your underachievers, and the patterns that deserve your attention. No matter your role in the FreightTech value chain, there is data waiting to be mined.
Here is the trick: focus on boosting those margins initially. By doing so, you are setting the stage for exponential growth. It is like smartly rearranging pieces on a chessboard – ensuring each move maximizes your advantage and sets you up for a winning strategy in the long run.
You can also read about Optimizing Connected Logistics Operations with Data Analytics from Trigent Vantage
- Reduce operational cost structures
In the face of budget constraints, consider tapping into global talent pools for development. Take advantage of the global resource pool in cost-effective regions for key tasks that help you maintain momentum without sacrificing quality. Additionally, explore managed infrastructure services to cut down on operational expenses and free up resources for strategic initiatives.
You can also read about Managed Services – 5 Things That Matter The Most from Trigent Vantage
- Improve current CX first and then develop new features
In times of market uncertainty, going all-out on new CX might not be the best bet. Instead, look closely at those smaller CX areas with big potential. Take FreightTech’s shipment tracking as an example. By optimizing current CX touchpoints, you can reinforce customer loyalty and conversions.
Imagine a scenario in the FreightTech world where a customer is trying to track a shipment. Previously, they would have needed to manually input various details to get real-time updates. However, with advancements in software technology, FreightTech applications can be designed to intelligently gather and display shipment information without requiring customers to enter every detail manually.
- Resolve your tech debt
Let’s say you operate a FreightTech platform connecting shippers and multimodal carriers matching different types of supply and demand. To maintain uptime, invest in regular application maintenance. By addressing minor glitches promptly and optimizing system performance, you ensure seamless service delivery, crucial for retaining customers during market fluctuations.
- Make continuous innovation your business’ DNA
While focusing on stability, always continue innovating. Leverage our Product Studio to rapidly create prototypes and MVPs. This approach enables you to test new ideas and concepts without extensive resource commitments. By constantly innovating, you can uncover new opportunities and stay ahead of the curve.
Imagine you\’re looking to launch a new predictive analytics tool for FreightTech innovation. Using the Product Studio, you can swiftly create a prototype. Using real-time shipment data, you can demonstrate how your tool enhances supply chain visibility. This rapid prototyping approach ensures quicker market validation and stakeholder buy-in. Convert a validated prototype into an MVP in weeks using Product Studio resources.
In the current market condition, one thing becomes evident: the right partnership can be your compass in these uncharted waters. By aligning with a seasoned partner, you gain more than just a support system – you gain a collaborator committed to navigating the ups and downs alongside you. Together, you can not only weather the storm but also leverage it to your advantage.
Through our decades of expertise, technology, and insights, we, as a trusted ally, can empower your FreightTech endeavors, allowing you to focus on building resilience and driving continued innovation. As the saying goes, “When the winds of change blow, some people build walls, and others build windmills.” We are unabashedly fond of this saying, for it encapsulates our philosophy. So, embrace the latter, embrace the journey, and together, let us start working towards a future that thrives amidst uncertainty.