How Courier Exchange aims to consolidate its lead

if any sector of the logistics market needed a freight exchange, it must be the same-day courier business.
Put yourself in the position of a despatch clerk.
An urgent job comes up without advance warning; you send a van a hundred miles up the road; yet you’ve had no time to arrange a paying back-load for it. How marvellous if you could log on to a Web site where you would find a whole list of couriers who need freight moved from the distant area back to your own and need it moved today. Problem solved.
Well, you can. For the past two years aWeb site called the Courier Exchange, or CX, has been offering exactly this service as part of a much wider package of resources aimed exclusively at the courier market. That is to say, it is designed specifically to allow courier companies to trade with other courier companies. Rival sites have popped up since then, but Courier Exchange was where it all began (in the UK at least); and in its two years of operation it seems to have picked up enough critical mass to guarantee it a leading role in the market it serves.
Lyall Cresswell, the man who started it all, says it is now “probably the biggest virtual courier operation in the UK.” Yet he is under no illusion that the site offers some kind of miracle that was never available before. He acknowledges that successful couriers build up their own networks of contacts all over the country, and usually have a pretty good idea who to phone if they need a back-load. “They wouldn’t last long if they didn’t,” he comments.
He should know; back in the 1990s he ran his own courier business, Mailpack Worldwide, which he eventually sold to Seabourne Express. “So I’ve experienced the business from inside,” he says. “I understand the culture.”
What his Web site offers, he believes, is “a holistic view of the industry”. And as he says:”You’d never get the kind of picture we offer from phone calls alone. We provide a breadth of access that was simply not available before from a single source.”
What that means in practical terms is that a courier with empty vehicles can call up a list of perhaps several hundred pending jobs throughout the country, complete with contact details, while a courier with freight to move can see a similar list of empty vehicles available that day.
Significantly, though, Lyall Cresswell is keen to emphasise that Courier Exchange is not a freight exchange as such. “We’ve never attempted to stand in the middle of transactions between couriers and take
a commission,’ fle says. ~‘We simply otter a place where couriers can ‘pitch their stand’, and sell their own wares.”
He says he’s avoided the commission-based route for the very good reason that “people are instinctively distrustful of them.”As he puts it: “Commissions cloud the issue, and would beg the question of who we were actually working for, They imply mixed incentives.”
Not that the site is run out of altruism, of course. In its early days it did rely on advertising revenue, but for the past year it has been selling subscriptions to participating companies, and now about a fifth of the 2,000-odd registered organisation s and individuals are paid-up members.
That proportion could now be set to rise steeply. In November Cresswell took the significant step of
restricting access to live loads to paying subscribers. Up to then it had been open to all, but he has made the judgement that enough people now rely on the service for him to be able to insist on payment. In any case, the rates are not prohibitive; for instance, it costs companies £30 a month for UK membership and £83 for Europe-wide membership (there is a growing international dimension, of which more later). Individual dnvers pay lower fees.
Interestingly, though, access to data on empty vehicles has not been restricted in this way. When we were preparing this article, for example, we were able to browse freely through details of no fewer than 288 vehicles available for back-loading. In itself, that D
figure is a testament to the high level of activity on the site.
In any case, something CressweU is keen to convey is the idea that Courier Exchange is not just a freight exchange, but more what he calls “a one-stop marketplace for the courier industry”. That means it also lists jobs (there were 8i on offer when we looked), and has a spot for buying and selling vehicles and even courier businesses or franchises.
In addition, the company is building up a range of ancillary resources such as insurance services. There is also a chat room, which seems to be pretty well-used (another sure sign of an active and lively site); and there is even a spot discussing the merits of various types of delivery van.

Ample contact details
Another string to the company’s bow is its directory of couriers.This allows anyone to do a search based on postcode or town, and comes up with a list of member-companies in the selected area. While it doesn’t cover the entire courier industry yet, it makes up for that by giving ample contact details and background on the companies it does list. And in future, Cresswell envisages wider coverage that takes in the whole industry.
To add further value to its courier database, Courier Exchange operates an accreditation scheme based on a range of criteria and including financial verification by ICSM Partnership. This is open only to couriers who register.
Interestingly, though, in spite of its move to offer a broad base of appeal, Courier Exchange seems currently to be putting much of its development efforts into the core functionality of the site — which means the exchange of freight information. For instance, text messaging is now being added to the site, allowing couriers to place a load by texting or email.There will also be provision for users to request SMS alerts of all empty vehicles travelling on a particular route.
Perhaps more in the operational mainstream, the company is now developing an online booking facility, using a mixture of Web and SMS technology. Until now, users have had to book freight capacity by fax or other means, but in future they will be able to make the booking on screen, and also raise a purchase order. The carrier in turn will be able to confirm the booking by SMS, fax or email. It will even be possible to send collection and delivery details by SMS.
“People will still ring the courier to make the actual booking,” Cresswell says. “You can’t automate the human element — or not yet, anyway.” But he sees the online booking as a major benefit. “It will streamline the job enormously.”
In a further development of this concept, the company will be making it possible for couriers to transmit proof of delivery back to the customer by SMS message. “One of the inhibitions preventing couriers using subcontractors is that if they lack modern technology, they may drop out of the tracking loop,” Cresswell says. “This system will pull them in again.”
The company is also developing the facility to handle payment processing. Customers will be able to
pay Courier Exchange by credit card, and Courier Exchange will pass on the payment when the POD comes in.This of course will take advantage of the enhanced POD services under development.
Cresswell admits that some of these moves may bring the company slightly closer to what has come to be regarded as a conventional freight exchange, but he insists:”We may take a handling fee for the payment service, but we’re not making money out of it.” A more sophisticated settlement solution is already in preparation, he says; but the company will still not aim to profit out of it.

Ideal position
One of the problems of the courier market is that it is by nature fragmented. There are thought to be around 3,500 couriers companies active in Britain, “but fifteen per cent of them go bust or split into separate groups every year,” Cresswell points out. However, he says Courier Exchange has been successful in attracting some of the bigger names, and has also made efforts to attract users from the express parcels market. “We’re in an ideal position to manage their relationships with couriers,”he says. “We’ve done that for a leading parcels company for the past year.”
The company has recognised that the courier market can have an international dimension, and already claims to have attracted 8oo membercompanies in France, Denmark, Germany and Holland. It is planning to extend its service to France and Italy by the middle of this year, and is also eyeing the US market. “No one there seems to have got our view on the world,” Cresswell says.
In a market that is always going to be spawning rivals, Courier Exchange may have to work hard to keep its leading position, but Cresswell cautiously admits that it is close to becoming the defacto service for its industry. If so, though, there seems no risk that it will be resting on its laurels.