More Software Sales to Trucking Firms Suggest They Are Preparing for Economic Recovery
By Dan Leone, Staff Reporter
This story appears in the Sept. 7 print edition of Transport Topics. Click here to subscribe today.
Technology vendors said sales of enterprise-level software have remained strong in 2009, propelled by carriers’ desire to cut costs now while preparing for the influx of new business that will accompany an economic recovery.
In particular, “larger carriers, larger private fleets and larger logistics companies look at this year as an opportunity to invest in [information technology] infrastructure so that when the market recovers, they’re well-prepared to take advantage of it,” said David Wangler, president of TMW Systems, Beachwood, Ohio.
Smaller carriers are not investing as much in technology as their large counterparts, he said, but fuel optimization software remains popular among all carriers.
“The real hard data that we’ve got shows our carriers this year are saving . . . about 10 cents a gallon,” he said. That saving is net of discounts carriers may receive through agreements with truck-stop chains or other methods.
In recent years, TMW has acquired several companies, including Maddocks Systems, TMT Software and Integrated Decision Support Corp. Wangler said TMW expanded the client base of each of these products once they were integrated into TMW operations.
Rick Halbrooks, vice president of sales and marketing for McLeod Software, Birmingham, Ala., told Transport Topics that some carriers that “had put off their decisions until the economy got better have come back to us.”
Carriers “are looking to preserve their profits by cutting out some of their wasted costs . . . which drives a lot of technology, frankly,” Halbrooks said. “There’s been a lot of talk lately about dumping unprofitable customers, and that’s hard to do if you don’t know who they are.”
Halbrooks also said July had been “the best July in the company’s 24-year history.” Much of the growth, he said, has come from McLeod’s bread-and-butter customer, the mid-size carrier with 200 to 800 trucks.
McLeod’s acquisition of Integrated Logistics Execution Network Systems, announced at the end of April, was going well, Halbrooks said. That company’s iLens product, which features software for shippers and third-party logistics companies, came into the fold when “everybody is wanting everybody to rebid everything because of the economy,” he said.
“iLens is getting us even further into the 3PL world and lets us get involved with the shippers, which we hadn’t done too much before,” Halbrooks said.
Meanwhile, Innovative Computing Corp., Brentwood, Tenn., also has registered an uptick in business from carriers interested in greater cost control.
“Some of the small and midsize carriers have delayed the commitment to technology,” said Ernie Betancourt, CEO of ICC, “and now, with a need to manage costs, they are exploring new technology aggressively.”
Betancourt said ICC’s “software as a service” product, AccessPlus, is attracting more interest, in particular from smaller carriers.
Also known as “software on demand,” SaaS outsources physical IT infrastructure such as servers to the software vendor and allows users to access needed applications over the Internet.
Revenue during the first quarter was the strongest in the past decade, ICC said. However, Betancourt said training activity has been down in 2009, which he chalked up to tighter travel budgets.
“Attendance in our Nashville classrooms is slightly down this year when compared to 2008, but our telephone training sessions are up,” Betancourt said. “The customer does incur travel expense to send an employee to Nashville, so that is probably the reason for the slightly down attendance in 2009.”
