In many ways, trucking is the backbone of the American economy.

In 2022, trucks transported nearly 11.5 billion tons of freight in the United States, representing 72.6% of the nation’s total by weight, according to American Trucking Associations, the industry’s largest trade organization. That same year, more than 3.5 million Americans worked as truck drivers, while another 8.4 million people were employed in jobs related to trucking activity, the trade group added.

Surprisingly, the business of moving goods from one place to another is marked by inefficiencies, confusion, archaic practices and a paucity of technological innovation.

Manufacturers, retailers and logistics companies all too often overpay to have their goods shipped. That’s because they have great difficulty keeping track of and thoroughly reviewing the myriad of invoices and other documents submitted to them by trucking companies, often in the form of handwritten notes, PDFs and Excel spreadsheets for such things as fuel surcharges and late pickup fees. On the trucking side, it can take weeks for freight companies to receive payment because of invoice disputes, often forcing them to take out high-interest loans to cover expenses.

In this scenario, American consumers also lose. That’s because manufacturers typically hike prices to cover their higher transportation costs. Experts estimate that the producers of cars, clothes, washing machines and other goods overpay by as much as 2% to ship their wares by truck.

 

Rationalizing logistics payments

Matthew McKinney, B.S. ISE ’13, believes there is a better way. McKinney is the co-founder and chief executive of Chicago-based Loop, a company that, in his words, “aims to unlock profit trapped in the supply chain” by removing friction in logistics payment to increase liquidity for every stakeholder.”

Loop, which also has offices in San Francisco, leverages proprietary artificial intelligence to help logistics businesses digitize shipment data. That makes it possible to quickly resolve any disputes that arise between manufacturers and trucking firms when invoices are higher than agreed-upon contracts due to additional charges. At present, Loop data shows that up to  20% of invoices have some sort of error.

“Our generative AI unifies all this unstructured data so you get a single representative view of the shipment and costs for both sides, with everything cleaned up and normalized in real time,” he said. “If everyone’s on Loop, then you remove all this paperwork and reconciliation hell because now everyone has the same source of truth.”

With Loop, McKinney added, manufacturers can easily scrutinize all invoice and associated charges to make sure they don’t pay too much. Freight firms benefit because they get paid on time or even early.

Additionally, Loop’s workflow automation means that manufacturers and trucking companies no longer need people performing tedious, error prone tasks. Instead, they can refocus their workforce on high-value strategic work. Said Jeff Toman, a finance executive at Loop’s customer Great Dane: “Loop has turned my team from processors to analysts.”