Episode 13 - FreightWaves LIVE Recap
Michael and Aaron recently attended FreightWaves LIVE, the premiere conference by the media juggernaut and technology company behind SONAR.
In this episode you will hear two quick conversations that were had back at the hotel wrapping up each day. They talk about their initial impressions and takeaways from each day of the event.
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Michael:
Now I get jumping too ahead... too far ahead in the story, but he did go through the five steps of what a Quaalude can do to you. I was like, "Wow, he's really talking about this on stage but..."
Michael:
Welcome to Trucking for Millennials, where we engage with the future of freight happening now. My name is Michael Clements.
Aaron:
And I'm Aaron Dunn and we're here to help trucking and logistics professionals stay up to date and ahead of the curve as our industry evolves.
Michael:
We're connecting with every step of the supply chain as part of our mission to increase transparency and provide world-class freight solutions.
Michael:
What's up? Welcome to another episode of Trucking for Millennials. Here we are live in Chicago, Illinois.
Aaron:
The Windy City.
Michael:
The Windy City, and it is cold.
Aaron:
It is very cold if you're listening to this in East Texas, just picture cold in East Texas minus about 20 degrees.
Michael:
Really cold day, but we had a good one and we were inside for a good portion of it.
Aaron:
Yeah, so it wasn't that bad. But yeah, it's 14 degrees. We woke up today at 6:00 ish. It was a little bit right before 6:00 we woke up and we were there at around 6:45. It was 10 degrees when we woke up.
Michael:
Yeah, walking outside. It was like a wall of cold just slapping you in the face. But it didn't take us long to get from the car back inside the convention center where we went to FreightWaves Live Chicago and had an absolute ball today. Really good two day conference. This was day one. And what'd you think?
Aaron:
So this is my first time to be at a FreightWaves Live and FreightWaves is... I mean it's a leader in freight media of all kinds and they're putting on this conference every six months-ish, somewhere around there. And it is the hub for everything freight tech. That's what they talk about. That's what they live and eat and breathe. Really they're at the forefront of freight technology because FreightWaves as much as they're a media company, they are really a software company. And they have this software platform called SONAR. And it's really the first time is what we're hearing at the conference today, is what I heard. Really the first time that so many different data points are pulled into one platform so people can really get a clear understanding of what's happening in the freight world. An extremely clear understanding what's happening in the freight world worldwide, especially at a national level in America.
Aaron:
So you can see what freight volumes are happening coming out of state or just different freight regions. You can zero it in on... by zip code. But also what's happening, where those freight volumes are going if they're going outbound, you can also track inbound tender volumes coming in different places. So essentially you can just have really detailed tracking of freight. So that's FreightWaves in general. But the conference itself is pretty impressive. There was a... they put on a... it's high production value from Freightwaves.
Michael:
Yeah. There's everybody from trucking companies to freight brokerages to the tech software side of the business to people that are just in different areas of the industry as far as... there is a big focus on software, but there are other companies there. And I think what's neat about it is that they've taken transportation and they've made it cool. They've made the sharing of the news, they've made the... just the fact that you're talking about freight rates and these things, they've put a cool spin on it. And I think that is a really unique thing that they've done, especially with all the cool blue LED lights, the cool music going on while you're there. And really it's so cool because everyone's immersed in it and they're just there to learn. You have a lot of people from all different areas, but it does seem like there's a common interest in the direction of freight and not really what it's doing today, but what is it going to be doing tomorrow?
Michael:
Another unique thing about about FreightWaves too is that they're connecting so many different people from across trucking and transportation because their biggest thing is they see the inefficiencies that are in the industry from paperwork to transparency, to reliability on the brokers, on the carriers, on the shippers. And what they're wanting to do is through media, make the industry better. They want to make everybody more informed of the issues that are in front of us. And it's a smart thing because whenever you get different people in a room trying to solve a problem that look at it differently, a lot of times you get that problem solved. And I think that they're trying to do that and they're bringing people together at a conference. That's why we're here. We want to be a part of that digital transformation and digital revolution of this industry.
Aaron:
So what would you say your favorite part of today was?
Michael:
Here in the insights, I really enjoyed the morning session. I enjoyed listening to Craig and just talking about FreightWaves and why they're excited about the trucking industry. But really I think towards the end of the day I really liked the Amazon session, but also listening to Uber. Listening to Uber talk about their product and how they're... what they're trying to do in the industry and so forth is pretty interesting. And ultimately they're kind of getting to be in a league of their own when it comes to being a... I put it in quotes, a brokerage. But what Uber's being able to do with their technology is bridging a lot of gaps.
Michael:
It's just going to be exciting to see or it's going to be interesting to see really how that technology continues to play out. Because when they're talking to you on a stage and they're putting that on the big screen in front of everybody, they make it look really cool, really efficient and really great for the trucking company. But just how we were talking to our Uber driver tonight, it started off at 10% margins and now they're at 40% margins. Uber's taking 40% of their rates. So what is that going to be like? But if Uber continues down the path they're on, their technology is spot on and they are going to be successful in this field.
Aaron:
Yeah, it is really interesting to see... to go from the conference stage to listen to the... he's like the vice Pres... I can't remember what his specific role is, but he's head of Uber Freight and he's talking about... he doesn't even consider digital freight brokerage or any of these other terms. To them it's, this is the Uberization of the industry. And their own philosophy is just... they're just interjecting that philosophy on to everybody essentially. And how to make it easy and all these things. And it's a good thing when you look at it from that perspective of, Hey, this is a service that the world needs. Right? And then you get into, we take an Uber back to the hotel or to dinner or something and you hear an Uber driver going, "They take too much money. I like it. I like the flexibility and stuff, but I've got all the risk. It's my car, it's my gas and they're taking too much of my money and making me rely on people to tip me, which I don't know if I can count on all the time."
Aaron:
And it's just interesting to hear the total other side of the coin in just an hour's time or 20 minutes later of how it really impacts people. And it does make you wonder how close they are to the drivers. We're taking an Uber consumer car, right?
Michael:
Yeah.
Aaron:
It makes you wonder how close they are to those people, but also how close they are to truck drivers that are actually moving the freight that they're wanting to broker essentially. And how... maybe they are close to them, but how much they actually value and want that to be a sustainable career for them. Because as cool and great and useful Uber is, they're still not making a profit. Eventually they're going to have to get a price hike again, you think. I don't know. It's just an interesting thing that we're experiencing, that we're in the middle of.
Michael:
Yeah. And, and they were touting, the transparency that you have on rates. But I took a picture of just the things that... the factors that go into their rates and one of them that I noticed was the location of the truck and not just the location of where that truck's at, but where it's been and where it's expecting to go. And that's actually one of the things that as a broker, we've heard carriers don't want you to know their normal routes. Because a lot of times, if you know those normal lanes, they know that you can work your rates into a place that, you know they're going to want to take that load. So they may lose some of their negotiation strength there. And with Uber there is no negotiation. It's either you take that rate or you don't. Which I don't know if there's some psychology to that and that maybe it's just more secure. Maybe you know like, "Yeah, I will take this rate for this and I'll be happy with it."
Aaron:
Well, and it's funny the way they talk about it, they talk about, "Hey, it's no negotiation. It's a feature." But if it's a traditional brokerage and you say, "Hey, there's no negotiation here, it's really easy. You just do what I say. This is the rate." That's not going to go well.
Michael:
You wouldn't think so at least.
Aaron:
But I guess on their end the value... They say, "Well, here's the value. It's instant and it's transp... You can see the math we've got it all mapped up and all that kind of stuff." So like that's the value exchange but it's really weird. It's weird.
Michael:
It's a little strange. One of the things I thought that was really cool though about that feature was the fact that, where they gave the timeline of the truck that 30 minutes before pickup dropped off the load and if you're a freight brokerage out there, you definitely know that this occurs to you and it does happen to you that trucks will just drop off the load and you don't know why. And they don't really give you a reason. They just drop off of it. Well Uber is okay with that. They don't care because immediately that that load goes right back to the market and it's sent out to the right people. What's really crazy is that their algorithms are smart enough to send it to the people they believe can get on that load right away. And they had the load covered within minutes afterwards and still had a truck there for the 12:30 AM appointment.
Michael:
So those kind of things are going to be more efficient to shippers. They're going to be more efficient to carriers and ultimately, well you just do away with the personalized side of the brokers you do away with the customer service side of it and now you're just dealing directly with the shipper. And I do think that that poses some trouble for companies like PDQ that are in the freight brokering. The good news is though, is that your customer service is still tops and without your customer service, if this was something that everybody was doing, you would see more than one company like Uber that was doing it. Now there's some digital freight brokerages out there. There's people that already use apps to connect loads to shippers or to carriers from the shippers.
Michael:
But it's going to be interesting to see what happens to brokerages like ours as we continue to develop our business and try to find the direction we want to go. Because ultimately I don't believe in the spot market and with specialized hauling like we do and a lot of the flatbed and open deck hauling, these are things that you necessarily can't automate. You're still going to have to have customer broker and carrier interaction. So it's going to be interesting to see how over really the next five to ten years this plays out. But listening to the speakers today, a lot of them are saying it's... we're still five to ten years away from this really new age of technology and new age of transportation. But whenever he said that in 20 years, truck driving jobs won't be anything like truck driving jobs today. That was a little eyeopening.
Aaron:
Yeah. One thing that did come up in another session was a CEO of Arrive Logistics and another founder, CEO of MoLo, which is another, I think digital freight brokerage. He talked about how he was kind of slighting on Uber a little bit, making the point that I don't know what happens... he's like, "I don't know about you guys, but in my line of work, things happen problems arise. It's just inevitable that they're in the middle of the road, in the middle of a shipment and the engine fails or there's a flat or just something happens. Just human stuff happens." And what happens there? you can really feel very quickly that where'd everybody go? there's no people there. And if you think about... I'm thinking from a media perspective of, you try to... if you've ever tried to run a Facebook ad or try to get in contact with Facebook...
Michael:
you're not getting in contact with Facebook.
Aaron:
You're not getting in contact with Facebook. There's no person behind there. Right?
Michael:
Mm-hmm (affirmative).
Aaron:
So it'd be a scary situation if that kind of... that's what happened because the scale of what Uber wants to be is so massive that they can't possibly take a call. But we're not there yet. We don't exactly know. But it's just all those questions. But that's just the... I guess that just comes with the territory of innovation where you're so far ahead that everything's just uncertain. Nothing's really proven, everybody's upset in different ways. But hey, another speaker said Uber works because we all believe in it, which is a really weird thing. It's like the only reason it works is because everybody's just like... the drivers are saying, "Yeah, I think this is going to work out for me." Customers are saying, "Yeah, this is a really convenient way to go." And even though it's really... it's not a profitable business. Everybody's like, "Yeah, this is something that I need in my life." Crazy.
Michael:
Well, it's going to be interesting to see what happens in the years to come. And I mean really this industry is moving so fast and if you don't think it's moving that fast, you should come to one of these conferences because you see really right in front of you, how fast it's moving. And if you're a trucking company or you're a freight brokerage out there and you're not investing in technology or software or figuring out your next move, strategy-wise, you are definitely falling behind in this industry. It's moving quick. And I mean, you look at it just a couple of years ago, you didn't have a massive media company that was doing anything but trucking. You didn't have somebody that could connect a shipper and a trucking company on a mobile app. These things didn't exist just two, three, four years ago. And it exists now. And now the technology is getting honed in and it's, it's, it's going to... it is changing the industry right in front of us.
Aaron:
Exactly. So yeah, it does... That is scary. There's a good amount of attendees there, right? Which is good, but at the same time, there's not that many. You put the amount of people that were in that building today, compare that with the amount of trucking companies that are out there. And it makes you realize how many trucking companies are potentially just putting their head in the sand and saying, "Well, not me. Not now. It's not going to happen to me or..."
Michael:
if your company didn't want ELDs, you're going to have to rethink your longterm strategy.
Aaron:
For sure.
Michael:
Because that means you're already anti-technology and anti-progressive in this industry. And I just don't see that it's... it's not going to work. It works right now and it still works okay. But I really don't know in five years if it's going to.
Aaron:
Yeah. Yeah. Well that was... I mean, that's the first day man. There's more stuff that we could... Yeah. All right. Well that sums up the first day for us.
Michael:
Lots of fun today.
Aaron:
Lots of fun. Lots of stuff to just continue to think over. And I mean we've got a full day tomorrow too.
Michael:
Yeah. Got The Wolf of Wall Street tomorrow.
Aaron:
Yeah, we do. Yeah.
Aaron:
We're here for FreightWaves. It was day two and this is our day two recap. So big day, awesome day full of really valuable insights and connections in a variety of ways.
Michael:
We had everything from motivational, to sales, to getting deep dives into the transportation markets and what's going to be happening, some forecast into next year. So really a good wrap up day at FreightWaves.
Aaron:
For sure. For sure. There was a lot, I mean it went in a lot of different directions. So let's talk about Wolf of Wall Street because that's fun. So-
Michael:
Yeah. So cool.
Aaron:
... keynote, pretty much the star keynote of FreightWaves this year was Jordan Belfort, the Wolf of Wall Street from the movie, all that kind of stuff. And he had a fireside chat with the president of FreightWaves.
Michael:
Yeah. And if you've ever watched the movie from what it sounds like these things did happen. This was a real thing and not get jumping too ahead, too far ahead in the story, but he did go through the five steps of what a Quaalude can do to you. I was like, "Wow, he's really talking about this onstage." But I don't want that to take away from the good information also that he was sharing. He is a fun guy, but he did share some really good information today.
Aaron:
Yeah. And I mean his big message is, "I was a failure and now I'm back on it." But yeah that was a... I mean he's just got a fascinating story and a pretty engaging personality and there's a lot that we can learn from just him in terms of how he communicates and sales and all that kind of stuff. That was pretty... It was pretty fun to listen to.
Michael:
one of the things that was cool about Jordan was the fact that he was in prison and his cell mate was Tommy Chong of Cheech and Chong. So that was... I mean, come on. But what motivated him was that he was talking to Tommy about his story and what happened at... what was the company's name? It was at Bridgemont, Oakmont?
Aaron:
Something like that.
Michael:
Yeah. So what happened at that company, he was telling him the story of his life and Tommy was just, "Wow, you need to write a book and you need to share that story with people." And that was something Jordan really never thought about doing at that point. I think he just thought he was a criminal in jail, was away from his family and didn't know what to do. And so that was essentially how he picked himself back up.
Aaron:
Yeah. Yeah. And it's really... I mean there's a lot of lessons from it, but he just talked about how, I mean, he didn't have much to do in prison other than learn a skill. But he talked about how he wasn't a strong writer, but he was reading books from the prison library and learning how to craft his own type of voice through reading these books and stuff. And then it just materialized in his own book. But I just think that it's really... it's even in harder times or times when you feel like you're in a bad situation, fortunately we're not in prison right now. We're not in a bad situation. It's pretty nice outside.
Aaron:
But you can always learn a new skill that will take you to the next level. And I mean, I think that we were around a lot of people who have skills that we don't have today and it's about connecting with those people who have the skills that we need to take our business to the next level or help other... from our perspective, how can we implement different skills that we're not aware of yet or what have you, into the brokerage side of the business to help trucking companies get more business.
Michael:
Yeah. It was for millennials and for younger people who are trying to figure out the way or trying to figure out their own business or young entrepreneurs. What's really neat about FreightWaves and what we got to do over the last couple of days is you get to ask questions and not feel dumb. You get to go up and network with people and tell them what kind of situation you're in in your business. You get to tell them what's going on with you. And most of these people have all been in either a freight brokerage or with a carrier, even the software sales people, the tech side of the industry. These people all really started off either with carriers as drivers, as dispatchers or as in operations or sales or with freight brokerages. So these are people that have done it and they also know tons of connections.
Michael:
I mean, it's crazy because you can just be walking... I mean, one of the software companies we went and spoke with today, their CEO of that company, used to be CEO of a very large freight brokerage. And now he's working together with a gentleman who was CEO of a tech company. And so these two guys have combined to form a freight tech company. So it's really neat though to see these cats all getting together and really using their expertise to further... obviously further their own lives and their businesses. But they're doing it for companies like us who are trying to figure out this digital age and what's that digital roadmap we should be traveling down.
Aaron:
So what would you say is your top takeaway from today?
Michael:
I think the top takeaway for me today was you got to have a motivated team that has one focus and has a mission, but that mission also has to be surrounded by a solid strategy that's not just about sales. It has to be about the people. And the core of that company. And then also the digital roadmap. I think that's really going to be a big piece to the companies that are successful in the future.
Aaron:
Yeah. It's really interesting how everybody is... everybody, carriers, brokers, shippers are figuring out what does digital technology... what does technology in terms of from a digital perspective, how is that impacting my business and how can I leverage that to the best of my ability and make sure that it doesn't sink me in some kind of way. And everybody is figuring that out at the same time. So even if there was times where we were like, "Man, are we super behind, or are we in the right place or what?" Everybody's feeling that at some level, whatever level they're at because everything's happening so fast. So yeah, I think that's something that I take away too, is that everybody's learning and it's really important to know where you're headed because that's going to inform what you do now.
Michael:
So a couple of takeaways too. At the end of the show, they had some analyst on and they really gave some insights into things we can expect going into the holiday season and from what we can expect in 2020. And so I thought that was pretty interesting. As far as the holiday, the holiday season goes, it doesn't seem like trucking is going to be picking up. It's going to be pretty leveled off through the end of the year. usually you can expect a peak to happen in the winter months, especially in the truckload market, but that doesn't seem like they're calling for that to occur. But on the bright side, it does look like 2020 is going to be another level year in trucking. So if you were able to do, okay this year, if your company was able to turn a profit and stay busy, it doesn't seem like you're going to to hit any tough times next year.
Michael:
But if you're one of those carriers out there that is struggling right now, you may be in for a wild ride again in 2020 and what we just read today on LinkedIn another trucking company over 200 power units shut down in Houston, Texas. So as you talked with Rachel today, the bloodbath in trucking, I put that in quotes. But that right now is in a way still going on. And so the companies that have a tough time making it right now could have a tough time making it next year. But if you feel like your digitization is going in the right direction, if you feel like your sales is moving in the right direction, you're probably going to be okay next year. But if you're having a tough time right now, it may continue.
Aaron:
Yeah, it's a lot... it seems like it's going to be more of the same coming out. That's what I got from... and that information comes from the... he's a businessinsider.com freight analyst, that's kind of where your notes are out...
Michael:
Bloomberg. Bloomberg.
Aaron:
Oh is it Bloomberg?
Michael:
Yes he's a Bloomberg analyst.
Aaron:
Got it. Got it. Got it.
Michael:
So it was really interesting and really... what they're saying for 2020 it's going to be about the same in 2021. So we're looking at the next two years as being pretty leveled off, not too different from this year and they do not see rates getting back to those heights that they were at in 2018. One of the questions that I did have the opportunity to ask at the end of the show was just how to freight brokerage is our size get larger and what are the things that you need to be doing in your business to take it from that say million, 2 million, 5 million, 10 million up to 20, 30, 40, 50 million. And how do you scale that business? And one of the interesting takes was he went straight to software and he said, "That's where you got to be looking. You got to be looking... are you laying the groundwork and putting in the right foundation in your software?
Michael:
Because so many companies are putting in ancient systems to start off and they're already getting themselves started off on the bad foot." And so that just tells me if you're starting or if you're contemplating whether you should get new software, say you're using an outdated TMS or something that you're really not a big fan of, but you don't know if you want to make that jump or not. If you don't feel like that software is going to be what you need in three years, five years. What I took from his answer is that you need to make that move now.
Aaron:
Yeah. Yeah. Steven Kovey, what is it, Seven Habits of Highly Effective People?
Michael:
Mm-hmm (affirmative).
Aaron:
The first one is begin with the end in mind. And that's what comes to mind when I think about that. If it's not working now, why was it going to work when you've got more people and more complicated stuff? So yeah, it's a good point.
Michael:
So a lot of really encouraging stuff came out of the show though. I think that a FreightWaves did an excellent job. Shout out to What the Truck, thanks for letting us on the show just to say hi today. That was pretty cool. Getting to go on the FreightWaves Live with the TVs and everything. That was really neat. But man, overall a wonderful show. I had a great time hanging out with you the last couple of days and this was a really good learning experience I think for, for PDQ and also for the Trucking for Millennials listeners. This is stuff that makes our show better, which then makes our listeners more informed and more educated on these topics.
Aaron:
Yeah, for sure. For sure. And we've got more insights I think. Once we... Because I've got notes that I've written over the past few days that I'm going to... I'm planning on pulling through and perhaps we can share some of those too in future episodes.
Michael:
Well, it sounds like we have a bright future just like the industry does.
Aaron:
Right on. Right on.
Michael:
Ten-four over and out.
Katie:
Hello, this is Katie from PDQ America. I wanted to invite you to join our newsletter, The Transmitter. If you'd like to receive the latest trucking news industry insights and other valuable information every week, visit go.pdqamerica.com/podcast.