updated 3/5/2020 1425est with DAT reply
As previously reported, some logistics providers reportedly received generic emails late Tuesday from the nation’s largest load board provider informing of price increases for their monthly subscriptions. While we have not received an official word from the folks over at DAT despite several requests for comment, we have uncovered some new details.
Originally we reported that the price increases varied in amounts. Several freight brokerages reported an increase from as high as $14.00 per user to several reporting price increases of $128 for one user. Comments on our original article show that some brokerages received increases of up to 54% of their previously agreed monthly rates.
Sources close to DAT told Freight Broker Live that the price increases were in part due to the removal of discounts on DAT products that had previously been applied to customer accounts. They report the decision to eliminate these discounts was made suddenly and spent most of the day Wednesday talking to angry customers who wanted a justification for the increase in cost.. According to social media, several clients cancelled their contracts and severed ties with DAT as a result of these price increases.
“DAT has also decided to screw their long time customers and take away 50% discounts for their Rateview tool and are quietly removing free 2nd logins off accounts with Power office subscriptions when you call in to make changes to your account,” said one online commenter on our previous story. “I was promised that I would have a free login for the life of my account when I complained about the last price increase and threatened to cancel, now they’re taking it away.”
Cost of doing business?
There is speculation online about the reasoning behind the sudden increase. Some believe the increase in the monthly subscription rates have to do with the race to complete a real Book-it-Now solution automating the booking process of a load. Several other load board and tech providers have released their own functionality to the public, DAT is still piloting it’s functionality with several large brokers and 3pl’s. The public release date of this functionality is not yet known.
DAT attributed the rise in the monthly prices due to increasing costs having to do “significant investments” in regards to new improvement and feature offering, including the development of highly anticipated predictive rating and analytics suite. These tools are also in pilot testing, but a release date of these products is scheduled for sometime next month. With only one other software provider working in the predictive rate forecasting space, DAT hopes to grab a portion of the logistics providers who are looking at new technology as a way to gain a competitive edge in pricing. Chattanooga-based FreightWaves released their predictive rating tool within their SONAR software late last year, which has the ability to predict same day freight rates, along with predictions for 7, 15, 30, 90 days and even a year out using historical rates, weather, economic and other data to forecast what the future rate may be for a particular lane.
DAT issued a brief statement confirming the reason behind the rate increase stating “Along with our annual price increase, select promotions also came to an end. The differences in price increases from one customer to the next are due to differences in packages, the number of users, plus additional features. If you want to learn more about other package options that might fit your business needs better, you can call 1-800-547-5417 and press 1 and then 5.”
While the timing of the price increase might have been a poor choice as it’s the beginning of the year, rates are low and profit is down as we wait for it to pick back up, customers who stay with DAT and power through the bad times will most-likely benefit long-term from DAT’s investment in emerging technology.