Tech Startups Have Eyes on $700 Billion Trucking Industry

Tech Startups Have Eyes on $700 Billion Trucking Industry

The trucking industry has seen an influx of smart technology over the past few years. Startup tech companies began developing apps to make trucking more efficient and truckers’ lives a little easier. Recently, startup companies started to focus heavily on the trucking industry and vying for its attention. Why? Because the trucking industry offers significant profit potential and is in need of revolution.

TruckerPath Pioneered Tech in the Trucking World

TruckerPath, founded in 2013, already accumulated more than $20 million in funding. The app is one of the most popular in the industry. Designed specifically for truckers, it shows locations of major truck stops, weigh stations, overnight Walmart parking, and more. The company hopes to reach a $1 billion value by the end of next year. Witnessing the successful integration of new technology in trucking motivated many other startups to focus more on the industry.

The New “Uber of Trucking” App

The latest startup is Convoy, set to become the “Uber of trucking.” Currently, third party brokers match shipping companies with freight carriers; it has worked this way for years. Unfortunately, there is a history of shady practices and inefficiencies. In fact, there are plenty of horror stories about truckers not being paid. For example, one driver never received payment of $18,000.

Since the industry’s deregulation in 1980, freight brokerage has become convoluted, and the side effects have trickled down to the truckers. As such, many startups are looking for ways to reinvent the trucking industry and make a profit, too. The potential definitely exists. Typically, tech startups go after markets valued between $1-2 billion. Last year, the trucking industry made more than $700 billion. Among other tech startups, Convoy hopes to earn a share of this profit and make truckers’ lives a little easier.

CEO Dan Lewis already raised $2.5 million in venture financing toward app production. He has a personal interest in the company as well. Working for his father’s supply company as a summer job during college, Lewis experienced firsthand some of the inefficiencies in industry logistics.

How Convoy Works

It aims to connect regional truckers with local shippers, so truckers can be home at night. Essentially, the app would limit or remove the need for freight brokers and put orders directly into carriers’ hands. Shippers enter available freight, the system generates a price, and then carriers choose and dispatch appropriate fleet members to complete the job. No more lengthy chain of phone calls between broker, carrier, shipper, and trucker. Convoy will work for both small loads and full truckloads.

Will the Industry Welcome the App?

At first, Convoy hopes to move into the construction, manufacturing, and retail wholesale markets. As of right now, the app has a moderately sized network in Seattle, which it is using to test the app before launch. As tech startups continue to shift focus toward the trucking industry, there is hope that apps like these will reinvent the industry. However, the trucking industry has been notoriously slow to adopt technology, especially when it comes from a non-industry entity. But, with Convoy promising to simplify the industry, the trucking world might make an exception this time.

Sources:

http://www.theverge.com/2015/10/27/9620352/convoy-uber-for-trucking

http://www.wsj.com/articles/startups-accelerate-efforts-to-reinvent-trucking-industry-1445918403

http://www.joc.com/trucking-logistics/tech-startup-emulates-uber-match-shippers-trucks_20140522.html

Leave a Reply

Your email address will not be published. Required fields are marked *

Request A Demo

See how we offer the most functionality in the industry with full visibility end-to-end.

  • Drayage Management System (DMS)
  • Intermodal Management System (IMS)
  • Use all your devices, whether Android or iOS
Request A Demo
Request Demo - GTG Technology Group