The Southeast Alaskan freight market can be a difficult space for businesses to navigate. With little choice in marine freight providers and low freight volume in many communities, it is difficult to entice more operators to enter the market leaving businesses and consumers in the dust. While it may be easy to blame these struggles on existing firms, much of the issue stems from the amount of freight moving in the region -- customers simply do not have enough cargo to make barge transportation cost effective. As a result, logistics cost remains the second biggest deterrent to business in the region, falling only behind cost of health insurance, as reported by the Juneau Chamber of Commerce.
This, combined with the high volume of barge traffic that already exists in the region (mainly serving industrial and construction needs) has led OpenTug to choose these communities as our first pilot location. The need for greater access to freight and our relationships with existing barge operators makes it a place where we believe we can succeed while helping local businesses with logistics challenges along the way.
It is fair to question how OpenTug offers lower freight rates in Southeast Alaska considering the issues the region faces. Many companies have tried and failed to expand in the region, why are we choosing to do it now? The answer, in our eyes, lies in sharing economies. Just as ridesharing and trucking have benefited from the idea of shared assets, at OpenTug we believe that by democratizing access to existing assets using technology, we can lower costs and thus pricing for everyone involved.
By aggregating loads of many customers using our state of the art customer management platform, OpenTug takes the heavy lifting of running a barge line off of the operator, and instead lets them focus on what they do best -- transporting cargo from point A to point B. With this system, any available vessel can carry cargo be it a 200 foot barge, or a 40 foot landing craft.
As customers request service in a region, they are automatically group with others interested in similar service. Operators can watch demand grow in real time, and as volumes increase, they can choose when there is enough cargo to facilitate a shipment. The great part is, due to the high fixed cost and low variable cost of barge transportation, as more and more customers join your load, freight rates drop for everyone involved. OpenTug is constantly and automatically sources more cargo on your voyages, and additionally finds backhaul opportunities to further decrease customer freight costs.
Over the past 3 months the OpenTug team has been hard at work to make this vision of more accessible freight a reality for the people and businesses of the Southeast. Notably our team recently visited the community of Haines, Alaska to meet with stakeholders both public and private about expanding service to the region. On this trip we coordinated with local government and businesses to source barges and cargo to help remove scrap metal and cars for recycling in Seattle, and built relationships with local community members to cement our presence in the region. As a part of these efforts, we advocated for infrastructure improvements and shared our vision to make Haines a local transportation hub for the entire Southeast.
Haines, like many Southeast communities, is excited by the opportunity to improve freight services, and we are excited to be a part of this change. Our maiden voyage in the region is arriving within the coming weeks, and if you would like to add cargo to the barge visit our job posting here. OpenTug is committed to continuing to serve Haines, and will be expanding our reach to other communities in the coming months.
If your business, town, or borough experiences the same issues identified in Haines, talk to a member of our staff to learn about how you too can integrate into the growing OpenTug freight network. Our dedicated operators are standing by to serve your loads and bring marine freight into the 21st century.