INTERORGANIZATION AND COLLABORATION

NTE EVENS THE LOAD

The hauling industry is not very efficient. Though trucks are likely to be full on outbound journeys, they are often empty on the way back. (About 50 percent of the trucks on America's roads at any one time are not full.) National Transportation Exchange (NTE) is attempting to solve this problem.
NTE (nte.com) uses the Internet to connect shippers who have loads they want to move cheaply with fleet managers who have space to fill. NTE helps create what is called spot market (a very short-term market) by setting daily prices based on information from several hundreds fleet managers about the destinations of their vehicles and the amount of space they have available. It also gets information from shippers about their needs and flexibility in dates.
NTE then works out the best deals for the shippers and the haulers. When a deal is agreed upon, NTE issues the contacts and handles payments. The entire process takes only a few minutes. NTE collects a commission based on the value of each deal, the fleet manager gets extra revenue that they would otherwise have missed out on, and the shipper gets a bargain price, at the cost of some loss of flexibility.
When NTE was first set up in 1995, it used a proprietary network that was expensive and limited the number of buyers and sellers who could connect through it. By using the Internet, NTE has been able to extend its reach down to the level of individual truck drivers and provide a much wider range of services. Today, drivers can use wireless Internet access devices to connect to the NTE Web site on the road.
In 2001, NTE expanded its services to improve inventory management, scheduling, and vendor compliance along the entire supply chain. NTE's software is integrated with its customers' operations and systems. NTE's business is currently limited to ground transportation within the United States. In Hong kong, arena.com.hk (called Line) provide similar port services.

Source: Complied from The Economist, June 26, 1999; Davidson,
April 2001, and arena.com.hk, April 2001