Less-than-truckload shipping can be a tricky mode for shippers and third-party logistics providers, especially those that are new to it and are not familiar with its complexities. Technology, like transportation management systems, helps maneuver the LTL sector because of its tracking and document storing/retrieval mechanisms. But when it comes to electronic data interchange (EDI) or application programming interfaces (APIs), which is the better option for shipping LTL? Let’s compare the two.
EDI vs. API
Electronic data interchange. EDI is communication technology that electronically transfers data from one system to another (or multiple systems). It allows companies to send large amounts of data in a secure environment without human intervention. For shippers, the data exchanged includes orders, bills of lading, freight management, etc. However, EDIs do have their limitations. They send information in timed batches, which is usually at the end of the day, making shipment documents out of date. They are complex to set up, have higher maintenance costs and are susceptible to break down.
Application programming interfaces. Cloud-based APIs allow for the same sharing of data and services as EDIs, but they do so in real time rather than in end-of-the-day batches like EDIs. APIs allow shippers to compare quotes from their preferred carriers in real time all on one screen. They also automatically tender shipments to carriers and ping the carrier’s confirmation back to the shipper and offer increased freight tracking and visibility throughout the supply chain.
The Verdict
APIs have more to offer the LTL shipper than EDIs do. Because they simply integrate into existing technology platforms, companies can begin using them and seeing the benefits nearly immediately. Shippers using freight-pricing APIs will improve their entire shipping process because companies can integrate APIs directly into their existing systems/platforms. Companies then have access to real-time freight rates from multiple carriers all in one spot for easy comparison, which can result in freight cost savings. They also gain shipping, rating, tracking and visibility functionality as well as the ability to aggregate useful data and share it along the supply chain. APIs also increase employee efficiency by automating a number of administrative and operational tasks, meaning employees can focus on more important issues throughout the day, rather than calling for rate quotes or building out an RFP or static routing guide. All of these benefits allow shippers and 3PLs to thrive in the LTL industry.
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