Jul 26, 2018
Lanetix recently launched the software suite LxRoadFreight, which is specifically designed for domestic freight brokers and trucking firms. The suite offers out-of-the-box solutions that stand to place the smaller domestic freight brokers and trucking firms on a digital par with industry powerhouses.
In a phone interview with John Golob, president and founder of Lanetix, the first thing that came across is potentially what a game changer the LxRoadFreight suite of software can be for domestic freight brokers and trucking firms. The smaller domestic freight brokers and trucking companies have long been working at a digital disadvantage with the larger players, such as the global 3PLs. But LxRoadFreight might be able to help level the playing field.
As Golob explained, for the last five years Lanetix has been developing products for the top tier global logistics providers. Lanetix and indeed most SaaS providers built CRM (Carrier Relationship Management) packages that were crafted to the needs of the top tier logistics providers at a price out of reach to the smaller domestic players. “What we heard from the mid-market and down folks (was) they’d love to use this technology…but our product was centered around more complex customized installations which was really a fit for the larger 3PLs.”
The problem for the lower end of the market – for companies with less than ten trucks or just a few warehouses - is that the CRM software in common use like Salesforce, Microsoft Dynamics, Oracle CRM Demand or SAP CRM, “wasn’t made for logistics market,” as Golob observed. “What we’ve done [Lanetix] is we’ve taken our tool, which is built for logistics, and we’re making it accessible to that smaller market,” Golob added.
Smaller is relative. The domestic mid-market and down trucking /freight broker niche is broad.
According to the Lanetix’s industry research of the 500,000 U.S. trucking firms, 100,000 own less than seven trucks. The research also suggests the niche is growing, noting as the 17,723 licensed freight brokers grew by 5.6% last year.
One of the key issues for this growing industry niche is the price point. The technology has been available but was cost prohibitive – particularly when customization is factored into the tally. While cloud-based CRMs often cost $60,000 (40 subscribers) in annual fees and another $125,000 to customize – not to mention a startup time measured in weeks – LxRoadFreight is $75 a month ($900 a year) per subscriber with a minimum of five subscribers. Additionally, LxRoadFreight is user friendly and can be up and “running within a day,” with its out-of-the-box functionality, according to Golob.“They don’t have to work with their IT department, they don’t have to spend lengthy hours with professional services teams to get started. It actually comes out of the box ready to go,” Golob noted.
On the pricing point of the CRM, Golob said from the beginning Lanetix wanted to make the entry level low enough for the truckers to be able to afford access.
Time is money
From the subscribers’ viewpoint, the LxRoadFreight package is designed to provide CRM functionality for such back-office demands as shipper accounts, carrier accounts, trucks, drivers, dispatchers and a great deal more. It includes a wide array of bells and whistles including a mobile app that works with both Android and Mac iOS.
Ultimately, LxRoadFreight, like any CRM (or really any tech), has to be bottom line driven. Putting all the specific tasks handled by the CRM aside, it saves time (and improves accuracy) and as the old adage goes “time is money.”
As Golob explained, “We [Lanetix] actually did a study with Penn State supply chain department. What we found is that sales people at freight brokers and freight forwarders spend more than half of their time doing back office processes. Entering data, scheduling meetings with co-workers, sending emails out, and not spending time with their customers. What the study really said was that the more time you can spend with customers, more likely you are to generate more revenue.”
In a sense the software can double the size of a sales force by simply increasing efficiency and putting the emphasis back in sales and out of the back room processes. As Golob points out, “We’ve built a tool specifically for these domestic freight forwarders and brokers, where the workflows are prepackaged, so they can go in and they have an onboard workflow - where they need to onboard a new customer. They can simply add the customer to our system, and send them to the workflow right away. There’s no customization or integration required.”
Unlike many other cloud-based software logistic initiatives which were built around the shippers’ visibility or other factors LxRoadFreight is squarely about the trucker and freight broker side of the equation. As Golob says, the system doesn’t compete with TMS but rather partners with them.
But what does it all mean? Is Lanetix’sLxRoadFreight really a logistics industry game changer? Putting Global 2000 IT in the hands of 20-person freight broker shops is as Golob says, “very powerful” and certainly may re-shape the digital aspect of the domestic trucking/freight brokering industry.