iTECH: Shippers, Brokers Use Data Services to Closely Monitor Carriers’ Performance
By Daniel P. Bearth, Senior Features Writer
This story appears in the February/March 2013 issue of iTECH, published in the Feb. 18 print edition of Transport Topics. Click here to subscribe today.
Shippers, brokers and freight forwarders are using new data services and software programs to monitor more closely the safety, performance and financial health of freight haulers before committing to hire them — driven partly by concern about liability risks if they use a carrier with a poor record and partly by the sheer availability of data.
Companies are using a variety of third-party vendors and internal transportation management systems to collect and analyze data, providing alerts when carriers fail to meet performance standards or when there is a change in insurance coverage or operating authority.
Industry observers said the availability of data from the Federal Motor Carrier Safety Administration’s Compliance, Safety, Accountability program is shifting freight away from carriers with poor scores and making it harder for new carriers to get business from shippers.
But in addition to checking out carrier safety compliance, shippers and brokers use a variety of screening tools to make sure the haulers they’re considering have good performance records, are financially reliable and can be counted on to show up and deliver as promised.
DB Schenker USA, a freight forwarder based in Freeport, N.Y., put in place a program four years ago to more intensively scrutinize motor carriers, said Stephen Gifford, vice president of risk management for the Americas.
“We recognized that to be successful . . . we needed to strengthen vetting and validation of underlying motor carriers,” Gifford said in an interview with iTECH.
The company adopted a carrier compliance checklist that included operating authority and insurance, safety rating, hazardous material certification and other criteria, such as being in business for a minimum of five years, and last year worked with software developer Veroot LLC in Medina, Ohio, to develop a program that provides alerts when a carrier falls below the company’s threshold for safety compliance.
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