Why 3PLs & Freight Brokers Should Invest in Technology During the Economic Downturn
As the saying goes, “When the tide goes out, you see who’s naked”.
And the saying applies here, that when the economy turns downward, it’s easy to see which third-party logistics providers (3PLs) and freight brokers prepared for that moment and which ones did not. In times of economic uncertainty, it’s understandable that these companies may be tempted to reduce their investments, including technology and process improvement, in an attempt to weather the storm. However, this often leads to exacerbating the situation, especially when the market recovers.
In this blog, we will explore four reasons why investing in technology during economic downturns is essential for long-term success, how it will help win more customers and serve them better, and why it’s worth the investment.
Staying competitive
During economic downturns, transportation companies need to work twice as hard to stay competitive and/or find a way to be twice as efficient. Adapting to the new market conditions typically brings with it new competitors and new challenges. Having the right technology makes a big difference in staying on top of the game and limiting customer churn. Technology allows businesses to do more with less, automate tasks, and discover insights into customer needs, preferences, and behaviors, and this results in reduced costs, minimized waste, and improved productivity. As seen in this article by Armstrong Group, investing smartly in technology is necessary in today’s competitive environment.
The Importance of Process Improvement
In addition to technology, process improvement should always be a priority for 3PLs and freight brokers, regardless of economic conditions, and the right technology will allow freight brokers to identify bottlenecks, make data-driven process changes, and continuously optimize workflows.
Automating tasks and implementing collaborative tools will also help your organization become more agile, efficient, and resilient. Additionally, it leads to other benefits such as better employee engagement and satisfaction. Investing in process improvement during economic downturns often allows businesses the ability to innovate and emerge stronger in the long-term.
Preparing for the Future
Economic downturns are cyclical, and our current market will rebound. Preparing for the future means taking proactive measures and investing in a way that will help organizations come out stronger in the next cycle. 3PLs and freight brokers that invest in technology and process improvement during economic downturns are setting their teams up to dominate when times are good again. Those businesses will be better positioned to win more customers and service them better when the economy improves. Without a doubt, they will have a competitive advantage over businesses that chose not to invest during the tough times.
Collaborating Towards Success
While there is no shortage of technology available, before a decision is made, there needs to be collaboration across departments in order for an organization to realize the full value of its technology investment.
Technology solutions such as video meetings, collaborative online platforms, and project management tools facilitate communication and teamwork, even when teams need to work remotely. However, the real gains will be the result of implementing artificial intelligence tools and machine learning technologies to truly drive efficiencies across the business. 3PLs and freight brokers who experiment with and begin investing in these tools will see the biggest gains, driving better teamwork, productivity, and efficiency while lowering labor costs, and increasing profitability.
Investing in technology and process improvements is crucial to long-term success. When the economy slows, it’s easy to see who is prepared for that moment and who is not. 3PLs and freight brokers that continue to invest in technology and process improvements during economic downturns are preparing themselves for when the market improves. They’re staying competitive, increasing efficiencies, streamlining operations, and positioning themselves to win more customers and provide exceptional customer service. Strategic planning and collaboration will pay off, helping businesses to not only weather the storm but to emerge stronger than before.