COMMENTARY: Why digitization leads to a competitive advantage in auto transport
Shifting consumer trends are changing the way car dealerships do business in the 21st century.
As more consumers buy cars online, many dealerships are forced to compensate for thin profit margins, sometimes even by selling company land to make ends meet. These unique challenges underscore the growing need for industry-wide adaptation.
The analog tools that once drove car transportation no longer accommodate the industry’s increasing demands. Paper, pens, and telephones were once a businessperson’s supplies of choice.
Car dealerships used paper to manage business processes, assign and dispatch haulers, generate bills of lading, create inspection paperwork, invoice customers, and more. Communication between dispatchers and truck drivers occurred primarily through phone calls. Without smartphones or cameras, dealers could not take pictures of vehicles during inspections, relying instead on hand-written notes to document existing damage.
The nature of car transportation reveals these tools' shortcomings. Paper quickly becomes wet or ruined, is difficult to use in inclement weather, and cannot be shared easily between staff in the office and truckers on the road.
Telephone communications are slow and inconvenient. Inspection documentation is more thorough and compelling, with photographic evidence of a vehicle's condition. Even something as simple as a pen failing to write can complicate an otherwise smooth delivery.
Now more than ever, businesses must embrace technology and digitize their operations to maintain their competitive advantage in an evolving marketplace.
A few years ago, the advent of digitization revolutionized the car hauling industry, streamlining and automating day-to-day business operations. Tech companies developed software solutions to assist car transportation professionals in all areas of their business. From inspections to claims, dispatch to invoice, technology turns formerly clunky processes into smooth, easy, and efficient ones.
Digitizing vehicle inspection
Vehicle inspection is a standard practice that has transformed with digitization. New technology helps dealers more thoroughly and accurately document inspection information.
Cutting-edge applications allow dealers to take, mark, and share pictures of vehicles to generate more detailed and accessible inspection documentation. Instead of wasting time on hand-written notes, which may fail to accurately document a vehicle’s condition, dealers can create visual records at the touch of a button.
These apps also support video, which means dealers can film a vehicle to verify its condition, for example, to prove its check engine light was off or record the sound of its engine.
New AI damage inspection software further automates the inspection process. This can improve inspection by locating and electronically marking damage, minimizing human error, and reducing the need for meticulous note-taking.
Thorough inspection documentation is critical in the claim process. Claims are often difficult to fight and can add to significant losses at the end of the year. Some claims can even put small haulers out of business. However, regardless of size, every business owner wants to be protected.
Technology gives haulers peace-of-mind when navigating the claims process. The ability to document photographic and videographic proof of a vehicle’s condition creates valuable evidence for fighting claims.
Previously, dealers who discovered scratches or imperfections on a vehicle could easily divert blame to the hauler. Overlooked blemishes or incomplete inspection notes could cost the hauler for the damage they did not cause. To dispute false claims, haulers often had to fight with customers and brokers, wasting time, energy, and damaging relationships.
Now, haulers can keep indisputable proof of a vehicle's condition in their back pocket. Taurus Auto Group, a car carrier that embraced digitization, experiences the difference firsthand. Before digitizing their business practices, Taurus suffered significant yearly losses in claims they disagreed with. Now, with the ability to verify a vehicle's condition upon delivery, they are keeping their money where it belongs: within the company.
Digitizing bills of lading
Digitization creates many opportunities for businesses to save money on routine expenses. Even buying office supplies creates large bills for companies that are hung up on analog techniques.
Auto transportation businesses used to spend up to a few thousand dollars every month on paperwork, including one of the most important documents in the business: the bill of lading. Companies often print three bills of lading per job: one for the customer, the shipper, and the broker. The amount of paper that goes into each job adds up to a large volume to print, sort, store, mail, and buy every few weeks.
Technology turns routine paperwork paperless and saves companies money on office supplies. To reduce costs and time, car hauling applications can duplicate and automatically send out bills of lading. With digital paperwork, employees no longer worry about paper supply shipments, misplaced documents, or snail mail slowing down critical communications.
Limited shareability is one of the most significant failings of old-fashioned tools. This is especially true in the car transportation industry, which, by the nature of the work, requires employees to travel away from their home base.
In the past, dispatchers and truckers had to circumvent distance to share documents. To send out load confirmations or bills of lading, dispatchers emailed the documentation to truckers, who then had to locate a truck stop with a fax machine to print it out. An inefficient process in and of itself, this practice creates many opportunities for wasted time along the way, from getting hung up in traffic on the road to getting caught in line at the fax machine.
Technology simplifies this lengthy process for streamlined communication and a more synchronized team. Car hauling applications work as a one-stop hub for all communications within a company, including the exchange of crucial routine paperwork. With every operation integrated across departments, teammates can connect effortlessly and keep critical information that all members can access. Now, every teammate, including dispatchers and truckers, can maintain a constant stream of communication and share documents across distances easier and quicker than ever.
Digitizing invoicing and payment
The speed of digitized operations is particularly powerful in invoicing. Previously, truckers had to keep documents like bills of lading with them as they traveled from state to state. This means that after delivering a vehicle, the transaction was paused until the trucker could return to the terminal with the paperwork.
As a result, funds came into the office on a delay, with a constant sum of money "in limbo" as truckers slowly carried the paperwork of completed jobs to the office for processing.
With digitized operations, haulers and brokers get paid faster. Once a driver verifies a vehicle's delivery in the application, the broker and dealer are automatically notified, and all information is submitted. Payment processing begins immediately. Now, drivers can get paid even before they arrive at the terminal.
Fast payment is key in the car transportation industry. Companies need a steady income to keep up with ongoing expenses like employee pay, insurance, and fuel. Automated transactions speed up the entire process and decrease the amount of time money spends "in limbo." This uncomplicates companies' methods of accepting and documenting payments, which reduces errors, hassle, and time spent on each job.
Digitization has powerful effect on business
Quick, efficient service is a win-win for all sides, from the businesses that profit from streamlined operations to the customers who appreciate the faster, more competent service that comes from well-supported, digitized companies. Digitization has a powerful effect on businesses, automating everyday processes, increasing profits, reducing wasted time, speeding up work, decreasing manual errors, and facilitating more effective workplace communications all in one place.
Nowadays, businesses that are reluctant to digitize are failing to keep up with the times. Specific demographics are, understandably, more hesitant to integrate technology into their business practices.
Drivers have been the slowest to digitize compared to all other positions in the industry. Older people, sometimes intimidated by the learning curve, tend to resist technology more than younger ones. Having grown up in the age of "there's an app for that," young people adapt to new technology more quickly.
However, those who choose to welcome technology into their businesses gain a substantial competitive advantage over those who do not. In today's marketplace, digitization is the number one way businesses can improve efficiency, profitability, and viability in a rapidly changing world. Those who’ve embraced new technology know that once a company digitizes, there's no going back.
Jonathan Stott is the head of shipper product at Ship.Cars