Of all the most critical transportation management system features, I’d argue that the ability to set lane-specific pricing is right there at the top.
Most TMS’s use Web Services to create lane-specific pricing, a feature that allows you, the broker, to customize service areas for different tariff profiles.
Web Services are a broker’s best friend — it’s an integral piece of pricing different lanes at different rates and maximizing your ability to generate a profit.
You and I both know that the brokerage business runs on razor-thin margins. The difference between a good month and a bad one depends on those margins being as high as possible.
Web Services help you do just that. Any TMS worth your money is going to use web services to offer lane-specific pricing. Though web services are used in a variety of ways in many different transportation management systems, this is one way that can make a real difference to your bottom line.
Basically, lane-specific pricing is a way to maximize profitability in different lanes by adjusting your pricing, markups, and tariffs. This helps you to stay competitive and keep your margins as high as possible on every shipment.
Simply put, web services are what connect the carrier’s website to your TMS.
They allow your transportation management system to talk to the carrier’s site, and vice-versa. They’re how you’re able to see all the information that your carriers have made available online, and access it from a single portal.
The intricacies of how web services work aren’t all that important to how you run your brokerage.
What matters the most to your brokerage is that web services connect you, the broker, to your carriers. The transportation management system you use dictates how easily you can see and interact with that information.
By being able to customize service areas for different tariff profiles, creating a set of pricing options for each client, and then saving those options and building them into your TMS, your customers, when they log in through a customer portal and request a rate, are automatically shown the rates you want them to see.
By putting the control in your hands, you’re able to maximize your profit margins in specific lanes. You decide precisely what the markup will be for different shipping lanes, and then you can save that information for different clients and use it again and again or alter it as your costs or the competition changes.
Further, you can define service areas for your clients and even define what pricing options are going to be available to those clients depending on the lane they choose.
As I’m sure you’re already thinking, this is an invaluable tool. The time it would take to constantly change pricing options for different clients and optimize pricing on each lane is enormous. To be able to do this once and then save the information and use it over and over is a huge time saver.
When trying to handle all this manually, it’s pretty common for the adjustments to just not happen as they should, which leads you, the broker, to lose competitiveness in specific lanes if you’re not careful.
In fact, if your competition has a TMS with this ability, but you don’t, you’re going up against someone who has the ability to shift lane pricing with ease, someone who is never going to forget to change a price for a lane, someone who can undercut your prices time and time again if you make a single mistake.
Doing this manually is a huge hassle, and trying to keep track of every potential change through a spreadsheet or a document leaves a lot of room for human error.
If you really want to optimize your brokerage and maximize your profits, getting a solid TMS (like BrokerWare™) ensures that you’re always setting the right rate, for the right client, every time.
A lot of brokers try to get by manually. The try their hardest to avoid having to pick up and use a new piece of software, and in today’s competitive market, that’s a recipe for failure.
TMSs, especially those with web services connecting them to carriers, are critical to the proper functioning of the modern freight brokerage.
If you don’t have a TMS, I hate to say it, but you’re probably not going to last out there.
It’s a brave new world for brokers, which is why we’ve written so much about how TMSs are changing the way you do business – and why we specialize in helping brokers like you scale your business.
If you’re ready to see what an advanced TMS can do for your business, request a demo by entering your information below:[contact-form-7 404 "Not Found"]