This story first appeared in the May issue of DieselTalk – CLICK HERE to download the magazine FREE
New Zealand-based start-up company TNX is creating a market for its online software platform designed to match a load with the right truck at the best price.
Four months into its operation TNX.co.nz is already handling pallet and container freight volumes of more than $100,000 a month.
Customers include large corporates such as Fonterra and Ravensdown as well as small to medium enterprises.
TNX looks for ways to consolidate, sequence and best match up freight and trucks in the market. Higher utilisation gross margin and lower spend are the result.
It also streamlines the back-office administration of the invoice-to-payment cycle with carriers receiving payment seven days after the job is completed.
Founders Alex Hoffman and Jonah McIntire say they created TNX.co.nz to help freight owners and carriers better use capacity in the market.
Transport accounts for more than 4% of gross domestic product but they believe on average trucks on the road are 40% empty.
“The assets are being used for a fraction of their capacity,” Hoffman says.
He and McIntire say better utilisation methods pioneered in the last 30 years, such as ordering a full truckload of product, consolidating freight movements and using a hub and spoke delivery model, have plateaued.
They believe TNX will eliminate some of the inefficiencies because much of the industry still operates using manual, over-the-phone communication and systems.
There are three problem areas, they say.
“People don’t see that there is a better deal available – there is no Trade Me of trucking, there is no software available to shippers to tell them what is the best option available and there is no way for the shipping community to see its best optimisation.”
TNX is now shipping pallet and container freight and might offer a livestock option in the future.
Both Hoffman and McIntire agree the sweet spot for TNX lies where the pressure of performance is already high, saying efficiencies can be driven further when there is already a competitive market.
“Where there is more than one company that can do the work, you can drive more efficiencies by consolidating loads from the nearest locations and reducing the amount of unladen travel for the truck.”
Carriers using TNX “love it”, they say.
“They see the value of the access to the technology, as well as improving their return on investment in the trucks and also the assurance of payment without additional back office cost.”
The pair set out to build a transparent business model.
“We only charge the two parties 1.5% of the freight cost, provided we have saved more than 3% for a matched price, and there is a $2 charge per transaction to cover administration costs.”
For those sceptical about the technology driving TNX, Hoffman and McIntire’s team has created an online Sandbox account where shippers and carriers can see how the marketplace works without any commitment required.
In its relatively short life, the company has already enjoyed some successes.
In October 2016, in the wake of a pre-market evaluation of NZD$6.2 million, TNX completed a funding round which saw it attract support to the tune of $1.6 million from a “who’s who” list of local tech investors.
“We came to New Zealand because it was a good first market to develop TNX, a boot camp which was located far away from other start-ups in this area, but we are fully committing to staying here even though we are looking at expanding into other markets,” Hoffman and McIntire say.
