How to choose analytics software for freight brokers and 3PLs: questions, data and traps

Most buying decisions for analytics start from a feature list. For freight brokers the better start is the questions that come back every month, the files already on hand, and the traps that make a tool look right in a demonstration and wrong in the first board meeting.

Start from the questions

Any tool you consider should answer these from your data, not from a sample. Ask to see it.

The data you already hold

• Load file
• Shipper volumes stated or from bid data
• Tender log with sequence
• Payables
• Quote log
• Receivables

If a vendor needs a warehouse built before it can read these, count that in the cost and the time.

Ten questions to ask any vendor

1. What does it need in place before the first answer? A warehouse, a data model, a modelling language, a partner? Ask for the list and the typical weeks.
2. Who does the setup, and who maintains it? Your team, the vendor, or a partner, and what that costs after year one.
3. Does the AI calculate figures, or choose from computed ones? A language model that writes queries or code can produce a plausible wrong number. Ask what it is allowed to do.
4. Does every total reconcile to a control figure? Ask to see a bridge that does not sum and what the product does about it.
5. Can every figure be opened to its rows? An answer nobody can check becomes a debate in the meeting.
6. What does it cost in the first year, all in? Licences, consumption, implementation, modelling and training, not only the seat price.
7. How does data arrive, and who holds credentials? A file your systems already export, a scheduled drop, or a live connection with the vendor holding keys.
8. What happens to the data, and where is it stored? Residency, retention, deletion, and whether names can be replaced with identifiers.
9. Can we see it on our own data before we sign? A demonstration on a sample dataset tells you little about your own.
10. What does the tool do when it cannot answer? It should say so. A confident guess does more harm than no answer.

Checks specific to freight brokers and 3PLs

Ask whether the tool enforces these, and what it does when they fail:

• Loads: Load revenue − carrier cost − accessorials = margin; sums to the ledger
• Tenders: Tenders = accepted + rejected + expired
• Quotes: Quotes = won + lost + no response
• Carriers: Carrier shares on a lane sum to 100 percent

The traps

Margin per load by shipper and lane. Reps are ranked on revenue or gross margin in total, so the largest account is assumed to be the best.

Primary tender share. Most tender logs carry the sequence. Few brokerages read it.

Carrier concentration per lane. Nobody notices until the one carrier that covered the lane takes a contract elsewhere.

Measures to leave out

Loads moved, alone. Volume without margin per load.

Gross margin percent as a ranking. Small loads flatter it.

Calls and emails logged. Replace with lane coverage and tender response.

A scorecard

Where Covirage fits

Covirage reads the exports above, answers the questions with figures our tools compute and check, and is set up for you within a week. See analytics software for freight brokers and 3PLs compared, AI analytics for freight brokers and 3PLs and Covirage for Freight brokers and 3PLs.

For the measures in full, with formulas and exports, read Sales KPIs for freight brokers and 3PLs.