Real-time pricing vs. spot pricing: What’s the difference?

Feb 15, 2021 at 09:50 AM CST
Traditional spot pricing – sending loads to auction – is sourcing capacity for loads that are not covered by mistake. The traditional routing guide strategy is to forecast annual volume across a linear average and send that out to bid. However, demand is not linear and sometimes that creates gaps in coverage. Historically we find that shippers experience this gap in coverage up to 10% of the time and then turn to spot auctions to source capacity when their loads are not covered by mistake. By mistake, I mean they forecast 25 loads per week and secured commitments of 25 trucks per week, but their customer ordered all 25 loads on Monday and Tuesday rather than the linear average across the week and now there is not enough capacity – by mistake.

Feb 15, 2021 at 09:50 AM CST

Traditional spot pricing – sending loads to auction – is sourcing capacity for loads that are not covered by mistake. The traditional routing guide strategy is to forecast annual volume across a linear average and send that out to bid. However, demand is not linear and sometimes that creates gaps in coverage. Historically we find that shippers experience this gap in coverage up to 10% of the time and then turn to spot auctions to source capacity when their loads are not covered by mistake. By mistake, I mean they forecast 25 loads per week and secured commitments of 25 trucks per week, but their customer ordered all 25 loads on Monday and Tuesday rather than the linear average across the week and now there is not enough capacity – by mistake.