Haven pivots from Expedia-for-logistics to TMS

Haven pivots from Expedia-for-logistics to TMS

A screenshot of Haven's new transportation management system.

Haven once touted its online-market as a groundbreaking rival to freight forwarders, but has shifted focus to providing shippers with an end-to-end system to organize and automate cargo management, underscoring the entrepreneurial drive digitalizing parts of the logistics industry.

The San Francisco start-up on Tuesday launched a transportation management system, Haven TMS, that the company said can dramatically reduce the amount of work, communication, and personnel needed to book, document, and manage cargo shipments. On May 1 Haven will shut down the online market that it started in 2015, although subscribers to its new system will still be able to use it. 

Haven TMS seeks to smooth the workflow required to book a shipment, eradicating the need for most of the 67 emails typically required for such a transaction, Haven CEO Matt Tillman told JOC.com The system can cut the cost of transportation logistics management by 30 percent, reducing the number of employees needed to handle bookings at a company that ships 15,000 containers a year from six to one or two.

Haven is one of a slew of startups with venture capital funding that in recent years have looked to harness new technology to transform the shipping and logistics process, casting aside traditional industry methods and equipment. With its new system, Haven is stepping away from developing an online marketplace that would reshape the cargo booking industry in the way that Expedia and other internet sites did in the air and hotel booking industry. Other startups with a similar goal have included Freightos and iContainers.

Haven’s marketplace worked much like a kind of Priceline for shippers, who, once signed up, submitted destination and origin, and volume information for a shipment that would be circulated to carriers and freight forwarders, who could submit a bid.

Haven TMS, with a monthly subscription fee that starts at $3,500, is designed to handle the shipment operation for subscribers from start to finish, enabling users to solicit tenders, and to accept and document them on a dashboard that enables the user to easily see all the details needed to make a decision, said Tillman. Communicating with different parties, such as making the booking or revising the bill of lading to correct errors, are all done electronically through the system, removing the need for operations managers to make and track numerous e-mails or make phone calls, he said.

Although Haven had planned to create a management system from early on in the company’s two-year history, he said, the company’s interactions with customers as it operated the website showed their main concerns were elsewhere.

“I don’t think [pricing is] the biggest pain point of the customer,” he said. That, he added, is “clearing and execution. Process is the biggest pain point.”

Managing shipment booking without a total management system, as many shippers do, “is a mess,” he said.

“You get quotes, you get various quotes that are wrong. You go back to the carrier to get them to update that. [Perhaps], they didn’t include the right detention and demurrage, back to the carrier to update that. And it’s just this massive back and forth hassle.”

The effort to provide a better alternative is not unique: Oracle Transportation Management, for example, offers a system that tracks shipments, automates manual procedures associated with freight bill payment, and “covers all aspects of transportation rates, including surcharges and discounts.” Another, SAP Transportation Management, helps shippers purchase freight capacity, streamline the management process and handle transportation and logistics data so as to assist analysis and planning.

Tillman said existing products focus mostly on storing and ordering information and don’t have the elements that make it more dynamic, such as the ability to communicate through the software with other parties.

“They don’t foster collaboration. Collaboration is not a central tier one feature on those platforms,” said Tillman. “Trade is a conversation. It’s a conversation with many parties, many pieces of documentation that only get done by main parties. So it’s collaborative by nature.”

TMS Haven enables collaborators to log in with varying levels of permission, he said. Banks, for example, can watch the progress of cargo they are funding and customs officers can also log in, he said. Problems with the bill of lading, normally done by writing on a paper copy and faxing it back to the carrier, to be followed up with a phone conversation, can be done in the Haven system by adding comments electronically and sending it back through the system, Tillman said.

The company has worked to remove the need for customers to fill in forms, drawing on customer information that is already in the system and enabling customers to submit information on printed paper pages that are scanned, with such information automatically extracted by the system, Tillman said. The system also automatically analyses any emails that arrive for the customer and extracts important details — such as the price on a shipment tender — and puts them in the system, Tillman said.

“Instead of logging into email and sorting through email,” he said, “you can now see everything in the context of all the shipments that you have. And you can see all the tasks get generated automatically for you, so you don’t have to search through mail to see what you have to do next.”

The dashboard allows customers to see a range of information, from details of each shipment to all the tenders sent by carriers, to the fees charged on shipments and total shipping expenditures, he said. A satellite-driven map enables a shipper to track the movement of specified ships around the world.

In the future, the company expects to increasingly automate the system so that it can make decisions based on customers’ guidance. For example, if a shipment is heading to the port of Los Angeles and the system learns that labor difficulties have halted the removal of containers there, it would take action, Tillman said.

“The system automatically learns that, and reroutes [the cargo] to Savannah,” he said. “It pre-negotiates rates so you can lower your costs through the Panama Canal. And it acquires trucking. Or it does the same for Mexico, or Vancouver, or Washington. It automatically can do it.”

Haven, with 27 employees, has to date received $14.8 million in venture capital from investors who knew that the online market was just the start of Haven’s long-term plan, which involved the company creating a comprehensive transportation management portal. About 25 beneficial cargo owners (BCOs) have been working with Haven over the last year, using elements of the final TMS as they were developed, so that Haven technicians could see what needs to be improved or enhanced, Tillman said.

Although the marketplace was successful —the company says it “facilitates the shipment of $3.5 billion in cargo value a year” — Tillman does not believe the Expedia-for-logistics effort is a viable business model in the long run. The company charged $20 to $70 per container for the service, and said it was able to reduce the cost of shipping a container by 8 percent to 20 percent for the shipper.

Shippers sending large volume of containers — and even those with smaller volumes of cargo — would prefer to use that leverage to negotiate a rate, rather than go to an online marketplace and accept the rate that is given to them, he said.

“It’s a pretty straightforward concept of commercial negotiation,” he said. “So I’m going to go to a website, and I am going to look up rates, and do some rate shopping, and then I am going to play them off everybody else.”

Contact Hugh R. Morley at Hugh.Morley@ihsmarkit.com and follow him on Twitter: @HughRMorley_JOC.