In early 2023, a wave of disruption swept through the freight logistics industry. Several Software-as-a-Service (SaaS) providers, essential to daily operations, unexpectedly raised their subscription fees — mid-contract. For many freight firms already operating on razor-thin margins, this move wasn’t just inconvenient; it was potentially devastating. However, while some companies scrambled to adjust, others took strategic and effective actions that not only cushioned the blow but placed them in a better operational position long-term.
TLDR: How Freight Companies Adapted to Mid-Contract SaaS Price Hikes
Major mid-contract price hikes from SaaS providers caught many freight firms by surprise, threatening budgets and disrupting planning cycles. The most successful companies employed proactive strategies, such as leveraging contract law, switching to open-source or modular systems, renegotiating with competing offers in hand, and, in some cases, co-developing custom solutions with new partners. These calculated exits didn’t just mitigate the impact—they spurred innovation and pushed firms into smarter, more flexible tech stacks.
The Silent Dependence on SaaS
Freight forwarding and logistics companies rely heavily on SaaS for everything from order tracking to inventory management, route optimization, and customer interactions. The software layer acts as the digital brain of an operation, ensuring efficiency, compliance, and real-time visibility.
Yet this dependence also leaves them vulnerable. When a cloud-based Transport Management System (TMS) or booking platform suddenly hikes its rates, the options seem limited—especially mid-contract, where the terms usually favor the vendor. But as several cases show, freight firms can and did find ways to regain control.
The Backlash Begins
In March 2023, a prominent SaaS logistics platform announced a “structural adjustment to sustain service levels”—corporate speak for a 30–50% price hike, effective immediately. Despite originally signed 24–36 month contracts, customers were told that “inflationary pressures” made the increases unavoidable. Backlash was swift. Small and mid-sized freight companies, in particular, were outraged.
Here’s how some of them responded:
1. Contractual Pushback and Legal Avenues
- Case Study: A regional freight firm in Ontario immediately consulted with legal counsel. Upon close inspection, a clause in the contract referencing “material changes in service terms” created grounds for renegotiation or termination. The company successfully argued that price doubling was grounds for breach and terminated the contract within 30 days.
- Lesson: Having contracts professionally reviewed—and being aware of clauses related to pricing, SLAs, and modifications—empowers operators to respond quickly and legally when vendors step out of line.
2. Migration to Open-Source Systems
- Case Study: Another freight company in Germany turned the crisis into an opportunity by leaving its proprietary SaaS provider entirely. It launched a tech upgrade project around an open-source TMS called OpenTMS, hiring a freelancer team to customize it for their needs.
- Cost Outcome: The initial migration cost around €45,000, but monthly software expenses dropped by 60%. Within one year, the investment paid off, and the company now owns its own modified system free from vendor manipulation.
3. Negotiating with Leverage
- Method: Having a backup option changes the game. Some firms lined up competitive SaaS quotes and revisited their current provider armed with leverage. One logistics company in Atlanta showed its provider a quote 20% lower for better features and used it to trigger a customized plan review.
- Result: The provider, fearing reputation damage and churn, agreed to freeze the rate increase for 12 months and offer a dedicated support manager.
Negotiation power in the SaaS world often favors the vendor—but not always. Showing that you’re serious about switching providers adds real weight to the conversation.
Cutting the Cord Without the Chaos
For freight companies contemplating a SaaS switch, the transition can seem daunting. But those who were decisive and strategic made it work. Here are four key exit strategies that worked exceptionally well in the aftermath of the 2023 price hike scenario:
- Dual Running: Maintain your current system alongside a new system, ideally in a sandbox mode. Many firms ran key processes through two platforms for 30–60 days before fully switching, ensuring continuity and reducing risk of operational mishaps.
- Staff Training Early On: Before switching over completely, successful firms organized a series of internal training sessions. One UK firm even brought in power users from the vendor as temporary consultants to train their staff hands-on.
- Data Portability Audit: Knowing how and in what format your data is stored is critical. Many firms requested full backups, including APIs and relational data files, before giving notice of termination.
- Tiered Rollout: Instead of a hard cutover, firms opted for a tiered transition—shifting customer management one week, billing the next, dispatch the third, and so forth.
Creative Collaboration: Building Custom Solutions
One of the most inspiring stories came from a mid-sized freight broker in Singapore that built its own modular TMS in collaboration with a local software agency. Instead of paying $120,000 annually in licensing fees, the company invested $75,000 over eight months to build a solution optimized for its workflow, integrating tools like Slack, Google Sheets, and even WhatApp APIs for client communications.
By owning the IP and customizing the experience, this freight firm future-proofed its tech stack, attracted tech-savvy employees, and even opened a new revenue line by licensing its platform to partners in Southeast Asia.
Looking Ahead: Lessons and Takeaways
Industry analysts agree: the 2023 incident may have set a precedent. While SaaS providers have historically enjoyed unilateral advantages, customers are waking up. The balance of power is shifting toward those that treat contracts seriously, plan exits carefully, and build fallback solutions.
Here are the primary takeaways from these freight industry veterans:
- Always negotiate SaaS deals with exit options — at least one clause should define clearly how price adjustments are handled.
- Don’t trust software providers blindly. Secure SLAs and ensure you can extract and port your data at any time.
- Open-source is more viable than ever. Especially for mid-sized operations, customizable TMS alternatives exist and are growing in capability.
- Build vendor relationships—not dependencies. Choose software companies with transparent pricing models, a proven track record, and the flexibility to pivot with clients.
Conclusion
What started as a pricing crisis in logistics tech became a catalyst for long-overdue transformation. Freight firms that took action—whether through legal channels, tech migrations, negotiations, or outright building their own systems—emerged more nimble and less chained to volatile vendor decisions. In an industry as dynamic as freight, the edge will belong to those who convert adversity into evolution. For freight execs witnessing this firsthand, one thing is clear: a smarter approach to SaaS isn’t optional—it’s survival.
