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September 22, 2020 12:30 PM, EDT

C.H. Robinson Aims to Disrupt Buying Process With Procure IQ

CH RobinsonBusiness Wire

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C.H. Robinson on Sept. 22 launched a tool intended to expand the ways in which shippers can analyze and buy freight lanes.

Procure IQ provides individual shippers with personalized and data-driven insights into their routes. That information is then integrated with its own freight marketplace data to unlock the optimal way to purchase transportation. Robinson Labs developed the tool to disrupt the traditional one-size-fits-all model that comes with the annual bidding process.

“It’s really about analyzing and modeling our approach to the way [request for proposals] are executed,” Robinson Labs head Tim Gagnon told Transport Topics. “There are many characteristics and attributes that make up the dynamics of that freight. What Procure IQ is all about is taking a much more personalized approach to what that freight looks like.”

Freight lanes typically are purchased in bulk during an annual bidding process. C.H. Robinson said the free tool challenges that traditional process by providing insight into each specific freight lane through a comparative pricing, volume and service analysis.

C.H. Robinson

Gagnon

“We are disrupting a decades-old way the entire industry buys transportation in order to drive better outcomes for shippers,” C.H. Robinson CEO Bob Biesterfeld said in a statement. “We are laser-focused on solving customers’ toughest supply chain challenges, which is why we are accelerating the release of our technology.”

Procure IQ did go through a trial period that involved select customers. Robinson Labs found large shippers were able to determine that 60% of their routes would increase savings or service reliability by purchasing that transportation outside of an annual bidding process.

“We use all of that information and the data science and software engineering to really efficiently take a much more granular view,” Gagnon said. “That could mean not buying it lane by lane in an annual process. It could mean bundling it in a way they haven’t thought about in the past. It could mean some of the freight is not a good candidate for an annual process and we should think differently about it.”

Procure IQ starts by inputting customer shipping needs and data. That includes lane origin and destination and volume estimates.

“That information is then integrated into a dataset containing billions of transactions from a community of 200,000 unique carriers and shippers and 18 million annual shipments,” a company statement said. Then it is used along with predictive analytics and artificial intelligence to provide shippers a custom visual analysis with tailored recommendations for procurement and capacity strategies for each shipment.

“It takes hundreds of thousands if not millions of rows of data and really brings that to a very efficient conversation,” Gagnon said. “We typically execute the data side of this process in a matter of less than two hours. Then we start doing the analysis and the collaboration.”

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Procure IQ does allow shippers to purchase lanes in a more traditional way as well, depending on what would be the best fit. A shipper could view and buy routes in bulk, or it could purchase them on a more individual basis.

“We’re collaborating on which freight fits into that routine and traditional process really well, and a lot of it does,” Gagnon said. “And then we’re looking at what part of it does not. In those conversations, we both learn a lot.”

C.H. Robinson noted it is often more cost-effective and reliable to purchase less frequently traveled lanes. More frequently traveled lanes are best purchased through a proactive contract to optimize savings and service.

“It is the customer’s network and our network,” Gagnon said. “We do integrate external information that comes from publicly available data that complements the customer and Robinson networks. We also integrate marketplace data that we purchased to provide benchmarks.”

Robinson Labs started developing the tool about a year ago to help customers better navigate the volatility the shippers market has faced. At the time, the company made a $1 billion investment toward its technology innovation commitment. Then the coronavirus pandemic and its impact on the markets accelerated the development and release of the tool.

“COVID caused incredible volatility,” Gagnon said. “But really, the last four years have been incredibly volatile throughout the marketplace. Those conversations have led to us developing a product here.”

C.H. Robinson Worldwide ranks No. 7 on the Transport Topics Top 50 list of the largest logistics companies in North America.”

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