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Explaining Freight Shipping API & Who Needs It

If you are involved in procuring technologies for your freight shipping or logistics organization, you have likely encountered the phrase “freight API.” However, you may not know what this technology is or how it can positively impact business operations.

To help you capitalize on this dynamic software solution, we have created this guide to freight quote APIs. We’ll tackle basic questions such as “What is an API?” and then we’ll outline the benefits of this important technology.

What Is Freight Shipping API?

The acronym API stands for application programming interface. Naturally, a freight API is an application programming interface designed specifically for the shipping and logistics sector.

Freight APIs are a specific type of software known as middleware. They bridge the gap between two applications so that the programs can share data and communicate. If an organization does not use freight APIs, an employee will have to manually transfer information from one program to another, which can become quite tedious.

How Does a Freight Shipping API Work?

Freight APIs are complex pieces of middleware that facilitate communication between two or more components of a logistics management system. These Freight APIs can translate information from various applications and networks, streamlining complex logistics processes.

Let’s say that your company is a freight forwarder and you work with a third-party logistics firm. In order to fulfill your obligations to the 3PL, you must frequently communicate and share information with them. 

A freight shipping API facilitates this by allowing your two systems to communicate. This can still be done in situations where your systems both contain different coding languages and architectures. 

Major logistics and shipping organizations have produced their own set of freight APIs. Businesses that partner exclusively with one of these companies can obtain the APIs and integrate them into corporate networks. 

Alternatively, businesses that work with multiple carriers can take advantage of API aggregators. In other words, these are platforms that have already integrated their system with several different major carriers.

Who Uses Freight APIs?

Many different types of logistics companies use freight APIs. A few common examples include the following:

  • Parcel companies
  • 3PL companies
  • Freight forwarders
  • Fulfillment centers
  • Trucking companies
  • Last-mile delivery
  • Shipping API aggregators
  • Freight marketplaces

The exact benefits that these organizations will experience as a result of using freight APIs will vary from company to company. However, regardless of the specific benefits, all of these entities will still be able to streamline operations and enhance overall efficiency by leveraging this powerful middleware solution.

How Much Do Freight APIs Cost?

Many freight APIs are available for free, especially those offered by major logistics entities like FedEx and UPS. However, companies interested in using APIs will still have to integrate the middleware into their existing technology suite. 

This process can become quite costly, especially if the organization cannot handle the integration as part of an in-house application. Third-party APIs and API aggregator services are often free to use as well. 

However, the API aggregator will typically charge a per-transaction fee for every deal struck using the platform. For instance, an aggregator that provides access to freight quote APIs may charge $10 for every container load shipment.

Benefits of Using Freight Shipping APIs

The benefits of using freight shipping APIs include the following.

Reduced Shipping Costs

Freight quote APIs allow companies to rapidly compare shipping rates from multiple transportation entities. They can then select the best available rates and reduce overall shipping costs. Companies that ship a large volume of products can save tens of thousands of dollars using a freight API.

Lower Checkout Abandonment

Ultimately, APIs can improve the efficiency of product shipping. These improvements will be reflected when customers put items in their online shopping cart and review the projected arrival time of their order.

Decreased shipping times will lead to lower checkout abandonment. Driving down cart abandonment should be a top priority for any eCommerce retailer, as accomplishing this will directly impact profitability.

Expanded Volume of Shipments

The efficiency benefits provided by APIs will improve the customer experience, which will lead to more orders. APIs also allow manufacturers to coordinate with their logistics partners more effectively. Cumulatively, these factors will translate to expanded shipment volume and higher revenue.

Eliminates Human Error

When APIs are integrated into a logistics management system, applications will be able to efficiently share information autonomously. 

This automation will drastically reduce the need for manual data entry, decreasing the frequency of data entry errors and ensuring that all logistics entities have access to the most accurate information possible.

Increases Business Efficiency

The most notable advantage of freight APIs is increasing business efficiency. Efficiency  has become more important than ever before due to the competitive nature of the logistics industry. 

Agile, efficient organizations will be able to grow, whereas companies with rigid business structures will have difficulty adapting to the modern logistics environment.

Things to Consider with Freight APIs

When exploring freight API solutions, you should pay careful attention to the following three factors. 

International Trade

If your organization is engaged in international trade, you may want to adopt an API aggregator instead of a company-specific solution. This is due to the fact that aggregators allow you to interface with the applications of multiple logistics organizations. 

However, if your international trade primarily involves only one or two major logistics firms, you could obtain APIs directly from your partners. It’s very case-specific, so keep that in mind as you look into which option may be best for you and your company. 

Integration of API

Integrating APIs into your existing network can be costly and time-intensive. Therefore, you must account for these expenses before adopting an API. 

Outsourcing can be a good option if you do not have the in-house resources to facilitate the integration yourself. A third-party service provider specializing in freight APIs can streamline the integration process and help you avoid any major headaches.

API Features

Each API or set of APIs will offer unique features and capabilities. In light of that fact, you must decide which features are most valuable to your business before choosing an API. Understanding what features your API provides will also help you maximize the return on your investment once your integration is complete.

Modernize Your Operations with a Freight Quote API

By investing in a quality shipping freight API, your organization can experience the many benefits outlined above. However, you must conduct thorough research before settling on a freight API solution so that you can select the ideal option for the needs of your business.

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