Kr-Asia is all about actionable insights for entrepreneurs. And through this post, you’re about to find out:
1. What are the advantages of relying on intermediaries in the on-demand truck logistics industry?
2. What is the business model of an on-demand truck logistics information platform that relies on both conventional intermediaries and cutting-edge technologies like machine-powered biding?
Writer: Lu Yurou
On January 2, 2018, Fuyoukache (福佑卡车), an intercity truck logistics company, announced the closure of its ￥150 million (around $23.1 million) series C+ funding round led by JD Logistics and followed by Legend Capital, Eastern Bell Venture Capital, and Global Logistic Properties.
As a freight platform, Fuyoukache provides information services for truck drivers and shippers.
Currently, freight O2O platforms are mainly running in two modes—DiDi mode and the agent mode.
The mode of DiDi, represented by Tencent-backed Huochebang (货车帮), intelligently bridges shippers and drivers via the platform. However, since many shippers are still reluctant to trust strange drivers with their big-ticket goods now, Fuyoukache did not employ this mode.
Instead, Fuyoukache chooses to work with conventional intermediaries in the transport sector, so that drivers can get orders via agents. Relying on intermediaries, Fuyoukache can cut its cost on credit guarantee and quickly access to their upstream and downstream resources.
Moreover, Fuyoukache is involved in the entire transport chain, providing norms and standards, trust guarantee and dispute mediation services.
As for price, Fuyoukache adopted anonymous bidding at first. The system forwarded orders to qualified agents for anonymous bidding, and then quote automatically based on historical transaction prices, vehicle model, transport line, goods category, peak/offseason, market supply and demand and other factors. According to Fuyoukache’s data, the quotation has reached an accuracy of 90%, highly consistent with the actual market price.
After the series C+ financing, Fuyoukache will introduce goods resources from JD Logistics, improve transport and service standards, clarify user persona and order characteristics, and lift the efficiency of bridging shippers and truck drivers.
Fuyoukache raised 250 million yuan in series C fundraising led by Legend Capital in March 2017, which brought its total fund raised in series C financing to 400 million yuan.