Lightning like Steve McQueen I'm in the fast lane when the light turns green and I built tough I ain't nothing but grit cause I made rugged blood, sweat and spit yeah like a horse I fly for a bumpy ride I like to play hard but I work harder and I under the storm cause I'm built stronger.
What is up, ladies and gentlemen, we are back. We are live. It is the freight coach morning show, the top morning show in transportation coming to you guys every single weekday 08:30 a.m. Pacific 1030 central to break down some industry headlines. And most importantly, you guys provide some actual insight into what you can do with all of this information. If this is your first time tuning in, welcome. This is the real souda freight, ladies and gentlemen. And I say that before every single show. And what I mean by that is I only speak with transportation professionals because at the end of the day, you guys, I want to talk to the right individuals who have done what you're looking to do or who are currently doing what you're trying to achieve.
So you can take that information, apply it, utilize it and see a meaningful difference in your business and your life. We got some very special guests today. I'm just going to pull them up right away, you guys, because we got to maximize our time this morning because we're all busy, we're all moving freight. And ironically, the freight I'm moving today was priced with their product green screens, you guys. And I got my friends with green screens back on the show. So I have Don and Matt joining us here today. Good morning, you guys. How are you?
Good morning, Chris. How are you?
I'm doing great. I'm excited to move some more freight today. I'm going to be honest with you guys. I enjoy winning the freight that I have right now, especially with the green screens pricing on there. Like, I was, like, I, I was telling you before went on the show and I was saying this the other day, is one of the loads that we won based on that rate was $13 off. Remember that? Because I'm like, I got to bring that up. That's a good state. It was a good stat. It was 13, I paid $13 more than what you guys said. The, the predicted rate was going to be on that lane and it was from Atlanta going into Illinois. So just throwing that out there, you guys, again, it, I'm actually moving freight with their tool. Okay.
I'm not just a pretty face, I am, but I, I'm actually moving freight with it as well. You guys got some exciting news coming out here.
We do. Really exciting. So I think, as a lot of people have seen already, we have, I guess last week. Time flies when you're having fun. I think it was last week we made announcement that we have opened up a call for folks to participate in our new shipper product pilot program. So bringing on some early adopter pilot customers that are shippers. And look, our plan with this is much like we built out the green screens product as it is today for freight brokers is really getting those few early adopters in there that are going to help us prove out our hypotheses, help us improve on the algorithms and the user experience over the next several months. So we actually do have our first shipper pilot customer onboard.
We've been working with them for several months now, and we're looking to take on three to five more early adopters for the next couple months, you know, 60 to 90 days or so before we really open this up to a wide commercial adoption or commercial offering, I would say. But we are ready to go with the product. We have a lot of great ideas. My friend Matt here really driving a lot of the innovation around this. So we're super excited about it.
Matt, didn't you kind of like, indirectly spill this on my show back at the ti?
I did, I did. And I learned really quickly the functioning of marketing and what a calendar is meant to do. So, yeah, I was just so excited to sort of throw that out. No harm, no foul. Everything's good. But, yeah, we got a little bit out in front, but there was a lot of work that was ongoing that were doing. And so this is not a snap decision. This has been a good part of the year. We've been focused on this. So, yeah, I did. I slipped up a little bit. So I guess that happens from time to time.
He was just so excited. But no, the reality is, Chris, we have been working on this for over a year. You know, kind of what drove us here. I guess I'll, you probably have questions, but I'll just jump right in. I mean, really, since even the very early days of green screens, we've had a lot of shippers that have approached us, you know, as they've learned about us and our product that we've been offering for brokers for, you know, three and a half years now saying, we want that product, you know, how can we get that product? And the stance that we had always taken with that was, we're not going to sell you mister and misses shipper, the same product we sell to brokers. Right.
But the demand became great enough, particularly over the past year or so, that it caused us to say, okay, what is the product that we can bring to market for shippers that will add value for not only for the shippers, but mutual value for the brokers and the shippers without really compromising our commitment to the brokers that we're not going to do anything to disintermediate them, to expose any of their sensitive data. Think about sensitive data as know their broker, carrier costs, their pricing strategies, margin, you know, any of those things. So this has been in the works for probably over a year.
And then having Matt come on board with us last October really just kind of invigorated and if not accelerated kind of our plans around this because, you know, Matt spent over 20 years focused on studying the market and benchmarking predominantly with shippers, but the entire market.
Yeah. And I, you know, obviously I know the answer to this and, you know, but I'm sure people are going to want to know if they're a brokerage customer of yours or they're thinking about signing up for you guys. They're like, how does this, like how does this affect my rates? Do these shippers get access to what we're quoting or what we might be quoting? You know, I know the answer to this, but I know that people are going to be thinking that right away.
Yeah, yeah. I mean, the answer to the specific question of are we going to be sharing the broker's data hard? No. The data sets that we're going to be using for the shipper product is entirely separate from the broker product, particularly, again, the sensitive information, the broker carrier cost, the carriers that they're using, margin pricing strategies, all of those things. Now, down the road, might there be some data that is more reflective, not of cost or price, but of volume, where the volume actually is that might be consolidated maybe. Right. That, that is not a known factor yet. I think as we build out this shipper data set, a lot of that will be TBD. But, but the firm commitment is we are never going to mix any of that price cost information. Right. So hard stop.
And I think the short term impact for brokers is, look, as I said, this is a journey that we're just starting on. The short term impact for brokers is fairly minimal. Right. It's, you know, we are going to continue to innovate for our broker customers. We are investing in each area separately. They will continue to see the same level of service and innovation out of us, though, down the road, we do believe that there is a huge opportunity for us to help, to, look, we're never going to eliminate the volatility of the freight market, that we'd be extremely wealthy if we had the secret sauce to do that. That's never going to happen, but at least to remove some of the friction and some of the chaos and some of the, you know, helping brokers to have a better educated buyer. Right.
As far as when markets are shifting, particularly right now, as we're beginning to see spot rates and contract rates. And I'll let Matt talk a lot more about this because he's so much smarter than me. But as we're seeing those start to converge, which may be an indicator of kind of the market, you know, certainly not where things were in 2021 and 22, but the market turning. And, you know, your audience knows that when markets do shift, you have these contracts that were negotiated a year ago or more that one part of the other party or the other is going to be upside down. So kind of minimizing the friction, you know, giving shippers tools that help them better understand the market and more importantly, their position in the market.
And I think that's the big differentiator, because we all know there are a lot of rate benchmark tools out there in the market that shippers and brokers are using. But what they are lacking is the ability for an individual company to understand their specific position in the market. What behaviors do they have that might be driving their cost up or down, cause them to buy better or worse than the rest of the market? And those are really the types of things that we're doing. And we believe that brokers, at the end of the day, benefit from that because, again, a better educated buyer, truly understanding where they are in the market. And there are some features that we are committed to work with our broker customers for that. As we build this out, where can we add more value for you? Right.
We believe that we can add tremendously more value for the brokers by having both sides of the transaction on our platform than we otherwise would be able to if we only had brokers and broker data.
Yeah. Matt, what rates are going to be provided to shippers in this instance? How are you guys going to be working with them to kind of provide pricing or forecasting or anything like that?
Yeah, it's very straightforward. I mean, the shipper community, you know, they have many different types of tmss out there, but they all have extracts. And so we'll be collecting spot and contract data from shippers, in addition to a lot of other variables that factor into the modeling design. Right. So being able to, as Don was saying, understand what are the drivers and the differences. So we'll be doing a lot to collect information that supports better modeling as well as better reporting and really learning about the shipper in ways that I don't think anyone in the market's really doing right now. There's a market rate, and then there's the reality in the behavior and the volatility of demand and things that happen that are very specific to different shippers.
So I would say we're going to go pretty heavy on the data collection upfront, but the ultimate aim is really any shipper will tell you out there if they spend too much, their business isn't competitive, and if they don't spend enough, there's always pressure to reduce costs down as far as you can. It just creates other problems. So we're trying to balance those two out to understand what's fair, but also give shippers a view of themselves that really help drive value in alignment with their capacity providers.
Now, is there a specific theme that you saw in doing some of the research out there? Because, I mean, obviously, you don't just, like, come up with a product like this, right? Like you guys talked to interested parties and then you guys, was there a theme across the board, Matt, where, you know, every one of them kind of had a similar challenge out there from the shipper community?
Well, you know, it's interesting that the challenge, I think if you look across the industry and you talk to anyone in transportation that's close to the industry, they understand what it takes to get the job done. They know what good and better invest looks like, and customers are always going to expect high performance. A lot of the retailers are coming out with performance fees. We've heard Otif at Walmart and things like that. So there's a lot of financial stress in terms of not being able to do what you're expected to do relative to scheduling and hitting appointments and delivering on time. And then just the idea that financially, as an organization, you have to hit your budget coming out of COVID I think Brent Hudo said it best. We're never going back to that.
If we do, it's going to be a similar tectonic shock to the market. Knowing that we're moving more into a normal cycle. Shippers are just trying to get back to bringing control and predictability, certainty in their performance of their networks and really kind of justifying their decisions. Right. It's very hard for somebody at the CFO level or other parts of the organization to, they just want to know you're doing a good job. But if you try to explain all the nuances of transportation, you're going to lose them cost and service and capacity and all these nuanced trade offs. So there's a real play there, I think, for technology, especially if you look at the green screen's journey and just how quickly we've been able to reach a very large critical mass with the broker community that technology is just very powerful.
And, you know, people talk about, well, we have a model, and it's so interesting because we're creating models every day. We have hundreds of thousands of models. They're perishable all the time. So you have to align your tech to constantly react and learn what's happening. And so the shipper market is just very ripe for that type of innovation. And we've got so much as Don was saying, so much interest just from what we've been doing with brokers and other parts of the industry that we're just super excited to start bringing this to the market and serving that need.
Yeah. So, Don, I was going to say, is there like a specific segment of shippers you guys are kind of marketing to right away, or do you guys want to talk to the shipper who moves one truckload a month all the way up to 500 in an hour?
Yeah, I mean, look, I think the initial focus is going to be building out that data network and the focus is really going to be on kind of the medium size to, let's see, medium large, right. Size shippers. But those shippers who, you know, are working with brokers already. So look, as went out and we talked to several shippers and as part of our research and analysis on going down this path, a lot of the shippers that we talk to a already have brokers on their routing guide, right. If not as a primary, at least as a secondary. I think everybody is aware that just with the growth of contracted rates, with brokers, right. Having brokers under contracted rates.
So the ideal shipper profile is somebody who is either already working with a lot of brokers, whether that's on a contracted or on a transactional basis, shippers who have a lot of surge freight, right, overflow freight, things like that aren't necessarily always moving on contract. I think that's really kind of the initial focus and that's going to expand over time, similar to the way that we grew green screens. Right. When we first started green screens, were really looking for that. We believed our sweet spot was going to be that $30 to $150 million brokerage. Well, now we are serving everybody from the pre revenue startup brokerage to, you know, eight of the top 25 freight brokers. Right? So that is going to expand over time.
But I think that initial emphasis is, you know, those that are medium to medium large size that already understand. And that was another thing that was interesting of the folks that we talked to is we understand the value that brokers provide. Right. We understand that, you know, brokers are not just giving us assets, they're giving us exposure to capacity that we would not otherwise have access to. We understand that, you know, they're providing us with value added services. Right. We understand we might be paying a premium for that, but it is worthwhile for us.
You know, a lot of these companies we talked to, they said, look, we can't even talk to a carrier that has less than 100 trucks in their fleet or, you know, thereabouts, whatever because of the risk and the time and the effort that it takes to onboard a new carrier and get them through our process. So by working with our freight brokers, we're able to get access to that capacity that we would not otherwise have. And one might argue that, well, today, you know, there's plenty of capacity out there. Well, that's true, but that's not always going to be the case. And again, if you look at the trend of the market share that freight brokers have and the amount of volume within some of these brokers is actually moving on a contracted rate as opposed to true spot transactional is fairly interesting.
But back to the point that even though they're contracted with these shippers for a year, whatever the case may be, they're still buying that capacity on spot market pricing in 90 plus percent of the cases. Right. And that's where the volatility is. So how do we ensure that the brokers, they're able to honor the rate to the shipper with reliable service, but still not be upside down and losing money or losing margin on these loads?
I really see a lot of because at least on the enterprise shipper level, a lot of the time for them to find out, you know, pricing. If they aren't an RFP, it's just like, hey, throw out the spot. Let's see if anybody can commit to it or not. And now I think that you guys are going to help them not even really need to take that step right where it's more like, hey, we have all the data that we need right here. This is going to give you an actual idea on realistically what this can pay because, I mean, there's a lot of bids that all put together and a lot of it is, hey, we just kind of need like a general benchmark on what it might cost in the event that we win this.
Because, you know, not everywhere is your typical food loads where it's like, you know, there's going to be 10,000 of these, this, you know, Atlanta to Chicago every single year. A lot of shippers out there, they need to be able to budget out their transportation on future bids of a lot of their project work that they might be moving.
Absolutely, Matt, I'd love for you to take that one.
Yeah, well, you know, you talk about themes with shippersen. There are shippers who are very opportunistic. They're always negotiating, they're always getting rates into their network. And then you have shippers that are more strategic in terms of running an RFP and trying to hold onto that. And you could say there's an argument that if you're more dynamic, then you're adjusting your rates more, but then maybe you're not getting the capacity or the commitment that you need from the carriers. There may be trade offs in terms of how you define that relationship. The more strategic shippers, you know, they're setting their rates and as they stay set, pricing changes. Right.
And if the market's moving away from you, simply using your historical knowledge of what those rates are, and I think, you know, with the static market, it does feel like that knowledge lasts a little bit longer, but the rates change all the time. And there are few shippers out there that will take a very low rate from a carrier that they know that carrier is maybe not aware of the rates for that market and expect that to work for very long. Right. There's just types of issues that come in. You may get more spot with the low ball rate. You may have other issues. So the shippers that I've dealt with, it's a battle of being fair, but also earning their sort of trust within their business and having some competency.
It's just very hard to dynamically understand what's a fair rate if you don't have a very good baseline. And we're really good at cinching that up on a daily basis in terms of that information that shippers need to make those decisions.
How do you guys plan on, I don't know what shipper technologies are out there at the end of the day because I've never been one. But how do you guys plan on differentiating yourself out there? Because I'm assuming there's no shortage of anything, opportunities from a tech standpoint for shippers, carriers, brokers and all of that stuff. So what's the vision behind, how are you guys going to separate yourself?
Yeah, I mean, look, I think the reality is shippers are using many of the same tools and market rate indexes that brokers are using today, as we've always differentiated ourselves in the market is, you know, an average of what happened in the past is not necessarily predictive of what's going to happen in the future. Right. A, B is that understanding of your actual position in the market, what are the operational behaviors that you have that are going to make you buy above or below the market? Right. So that's kind of in the short term, what is it, you know, getting to that more accurate predictability, not necessarily of what did happen, but what is going to happen.
And, you know, for a shipper, as they're doing network design, as they're putting together their rfps, as they're doing their annual budgeting process, or even qbrs, whatever the case, may be, having a better understanding of what that exposure is, how that's going to change over time. There are no tools on the market that provide that level of visibility for shippers today, first and foremost. But I think as we go down the road, this is just the tip of the iceberg and we see this really evolving into kind of enabling a more dynamic procurement process across the entire ecosystem that is more iterative and reactive to the market longer than, rather than being locked into these long term contracts that, you know, that the value or the benefit flip flops over time to one party or the other and making them more consistent. Right.
Consistency in these relationships and the value gained from them. A process that can support both short term and long term contracted and spot. Right. Bringing the more connectivity around, rating and pricing for brokers and shippers closer together.
Do you think?
I'm sorry, go ahead.
I was just going to add to that. Yeah. You know, if you look at sort of the freight tech renaissance that occurred in the brokerage space recently, right. Clear winners, clear innovators. Like there's a whole new breadth of tech. And I think what has allowed some of those companies to be truly successful is understanding. I always joke with Don, you've got to love the problem more than the people suffering from it. When you think about a product and you think about how tech should enable a business. There are so many points of friction in the status quo. You think about people shuffling spreadsheets, you think about people having sources of data and databases. That's not the solution. The solution is embedded much deeper into what is it you are trying to accomplish? How do you align to maybe multiple strategies within your network?
How can the tech enable that? So very similarly to how we've developed green screens technology to meet brokers where they are. And there's lots of different ways to do that, whether it's partnerships and integrations and ux. All of that same vision that made that solution work so well for brokers is going to come to bear on the shipper side. And, you know, the status quo is just a lot of tableau power, bi spreadsheets, go download a bunch of information. And I think the problem is actually a little bit more nuanced than just having sources of information. It's finding out what does that process look like? What are people really trying to do? How does the tech morph into those types of solutions? So I think that you talk about innovating and differentiating.
You've really got to get your hands dirty with what people are trying to accomplish and get right there at that level because the machine learning by itself is actually quite powerful. But until you deliver that through the right means and understand the consumption, it's just a data source, right?
Data is just Data unless it's actionable.
Yeah, because I was going to say, I think what, you know, this might be getting, you know, way far ahead of it. But I think, like, from a shipper perspective is, you know, they obviously are out there judging who their co packers are, their third party warehouses that they're working with. And I think, like, you know, people reflect their pricing and bids based on some of the facilities that these loads go into or get picked up out of. And I think that would be cool to kind of see that tailored to that a little bit so they can get a better understanding because there's, I mean, I'm not going to mention any names, but there is a lot of facilities out there that are priced vastly different.
When they find out, when carriers find out it goes into, you know, x distribution center, they're like, yeah, I'm going to need $500 more to go there because I know realistically I'm going to have to wait 6 hours to get offloaded. So it's like, that's the data to me that I think some shippers might, they might be aware of it, but like it's going to be plastered in front of them now.
Yes.
Yeah. You're leaning into areas that we feel are underserved right now and that self awareness. And not only that, it's not even the shipper. You talk about a shipper and there's, I don't know, five or six different influences in a supply chain. The people that manage transportation and deal with carriers, they know these things, right. The difficulties in quantifying it. But any good shipper, any good transportation manager, director, VP that knows their carriers well will tell you they are the eyes and the ears of my customers, of my DC's, of my vendors. Like the carriers are very, they're very good at sharing information.
But the challenge has always been how do you take the sad face, you know, flat face, happy face, you know, service metric and turn that into a dollar amount to say, no, you need more space, you need drop, you need to think about your, a lot of time. It's just DC labor. That's not our schedule. We're only open from twelve to four and then you've got like 20 loads on the dock and nowhere go park somewhere. And these types of behaviors.
Quantify that for that.
Yeah, we need to quantify that and help the shippers educate their organizations and understand the cost of that.
Yeah, there's, I mean, there's so many different. That to me is like what the beauty of all things technology is really bringing out there to the market because it's like, you know, you, I don't know. At the end of the day, I feel like when you're going to make the best decision, you need to remove human emotion from a lot of it and you need to just actually focus on the story that data is telling because, you know, again, you're sitting there thinking about every situation and how it personally affected you as the individual. You're not thinking any, you know, at least most people, maybe I'm the only one who does that, right. But I would say it's not just me who makes their decisions based on how certain scenarios have affected them in the past.
And sometimes data will tell a completely different story out there. I mean, I see it all the time inside of brokerage throughout my career is, it's like, oh, that lane sucks. Or that there's something about that sucks and it's just like, well wait a second, that's one of our more profitable lanes that are out there. What about it suck. Oh, because you don't like the fact that you have to tell somebody certain details about a situation, but we make money on it every single time.
Yeah, yeah, exactly.
Yeah. It's, it's gonna be interesting to see kind of how a lot of this rolls out. So, like, what, how does anybody find out? Like, are you guys actively reaching out to people for this? Is there like a referral thing? If any, you know, any shippers who are watching this, how do they reach out to that? Or any brokers who, you know, because people who have close relationships with their shippers who might want to be, you know, on board for this.
Absolutely. I'm so happy you asked that question. So first and foremost, if you want to learn more about it, you know, certainly visit our website, greenscreens, AI. There's a little bit more information out there. Some faqs for brokers as well as for shippers. We are actively reaching out to customers as well as accepting inbound leads, we are offering a referral program. So any green screens broker customer who would like to refer shippers to us, there is a referral program. The referral form or to sign up for that program is also on our website. And then if we sign one of the shippers you've referred to us and they become a green screens customer, you essentially get a rebate associated with that. There is a cap on it, but it's essentially the equivalent of one month of your monthly subscription.
You capped at a certain amount. But, and that would be for every customer you refer to us. So if you refer us ten customers, you get a rebate, the equivalent to up to $5,000.
We'll say, shit, that's good. I like it. No, I think that this is going to be a great tool out there. And again, data is everything. And I think it's moving the industry forward in the right direction. I really do. And then, so, yeah, I appreciate you guys joining me on this one. And Celine, put that in the comments. But it's shippers dot green screens dot a. If you guys want to learn more about that, and for some reason, if you guys can't find it, hit me up. I will gladly put you guys in contact with my friends over at green screens if you guys want to find out more about that. But Don, Matt, thank you so much for joining me, as always. It's so great. And it always goes by too quick every time you guys are on.
A pleasure to join you, Chris.
Well, I appreciate it, you guys. And hey, we'll be back on Monday, as always, you guys. If you guys got value in what you heard subscribe to the show. You guys share it out there. Dear network, because if you see value, your network's going to see value as well. I appreciate you guys. I love you guys. And we'll be talking to you soon.
All right, thanks, Chris.