What is the Economic Outlook for Freight Brokerages in 2023?

Strong but shaky is a good phrase to describe the economic outlook for freight brokerages in 2023. With more businesses emphasizing supply chain efficiency to ensure streamlined operations, demand for freight broker and 3PL solutions should remain strong. With more competition and better technology, brokers and 3PLs will keep offering economical rates, dependable work, and quicker shipping timelines.

Freight brokers arrange and negotiate the contracts between shippers and carriers, handle documents, and preside over transactions throughout the supply chain. This way of doing business ensures that goods are delivered on time and at or under budget. Greater demand for brokers allows this subsection of the industry to drive value through lower costs and better customer service. Digital solutions are also becoming a bigger priority for brokers and 3PLs.

According to Gartner research, professionals working with legacy paper products spend 50% of their time looking for misplaced information. This is a loss of $14,000 in employee time. At the same time, as much as 3% of a company’s revenue is spent on paper, printing, filing, and storing. This is even higher in the transportation industry. Exacerbating costs, a single 4-drawer cabinet costs $25,000 to fill and $2,000 to maintain each year.

Finally, knowledge workers making $30/hr will waste $4,500/year working with paper and 70% of businesses existing today would fail within three weeks if they had a catastrophic loss of their paper records.

New tech can help freight brokerages drive efficiency, retire manual processes, and encourage growth. AI is one of the technologies that can help reduce costs and improve workflows. Transflo’s newest AI solution is called Workflow AI, and it can help meet these needs for all sizes of brokers and 3PLs.

As cost savings and business improvements become clear from innovations like Workflow AI in the freight brokerage space, more companies may enter the industry in 2023. Additionally, other tech advances, like data digitization, can help boost transparency between shippers and carriers and make rate negotiations easier.

In sum, the forecast for freight brokers in 2023 appears optimistic. Due to increased global trade and more advanced technologies coming to the fore and being accessible, the 3PL industry appears likely to take advantage of these tailwinds and offer improved services. However, market conditions could vary and cause some issues in the year ahead.

For more information on industry-leading software solutions for carriers, brokers, factors, and shippers, please reach out to us today!