Electronic Commerce
Until relatively recently, when the popular media published stories on how the Internet can create efficiencies in the marketplace, it focused on the distinction between "e-tailers" (e.g., Amazon, e-Toys, Pets.com, etc.) and traditional brick-and-mortar retailers.
While this phenomenon is indeed interesting, the truly paradigm-shifting impact of the Internet will likely come from the business-to-business ("B2B") market as opposed to the business-to-consumer ("B2C") market. B2B marketplaces are online bazaars where the buyers can cut transaction costs as sellers benefit from larger volume. While versions of B2B marketplace have existed in more primitive forms throughout the past decade, now they have reached a sophistication and ease of use that their presence is likely to be more noticed.
Unsurprisingly, the trucking industry is at the forefront of the B2B marketplace. By filling every last bit of space on the trailer and matching appropriate companies with one another, transportation B2B marketplaces promise to give carriers more business and provide shippers with lower rates and greater reliability.
Of course, by lumping multiple shippers together in an effort to reduce excess trailer capacity, a certain amount of personalized service is potentially lost. The B2B transportation exchanges have addressed this problem by allowing shippers and carriers to list their restrictions and/or requirements(e.g., insurance amounts, freight type, weight, size, routes, etc.) so that compatible shippers and carriers can be matched.
However, a review of several prominent B2B transportation exchanges’ web sites leads one to wonder how personalized a shipper or carrier can make allocations of legal liability for torts, for damaged, destroyed, or late goods, or for situations in which a carrier who does not receive its payment. In short, there is not a lot of information on these subjects on these sites–perhaps these topics or too gloomy for start-up companies.
Nonetheless, it is extremely important that shippers and carriers who are considering participating in an online transportation B2B exchange to do a little digging to get full disclosure on who is liable for what in case something goes wrong.
This may not be an easy process as the customer service representatives at several of these companies appear to be completely unfamiliar with liability issues. As always though, an ounce of prevention is worth a pound of cure.
To ease this load, this newsletter will continue reporting on legal developments surrounding liability issues and B2B transportation exchanges. In the meantime, we suggest that you take at look at the following sites to get a better idea about some of the players in the B2B transportation exchange marketplace:
National Transportation Exchange (www.nte.net)
FreightMatrix.com (www.freightmatrix.com)
CarrierPoint (www.carrierpoint.com)
Transplace.com (www.transplace.com)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
