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Address verification and geocoding improve shipping quotes and increase delivery accuracy

Products used
US Address Verification
US Rooftop Geocoding
Smiling delivery person holding a package and a tablet, standing in front of an open delivery van filled with boxes.

At a glance

Bad addresses and a lack of location information can result in driver delays and extra fees for shippers.
Address validation and rooftop-level geocoding help HighlanderTek deliver accurate data to shippers, carriers, and drivers.
Fewer unknown addresses improve shipping quote accuracy and help drivers get to the right location without difficulty.
A delivery person using a hand truck to move a large box from a van in front of a house.

The client: HighlanderTek

HighlanderTek is a location intelligence platform that aids in last-mile delivery, with a focus on parcel, LTL ("less than truckload"), and food/grocery freight types.
Location matters in shipping, and HighlanderTek is revolutionizing the industry by challenging traditional pricing models. Traditional approaches rely solely on postal codes, overlooking essential address attributes that impact delivery times and costs. HighlanderTek is creating a database of address-level location information that affects delivery accuracy.
HighlanderTek’s Location Intelligence Platform provides critical insights into consignee addresses, including valid addresses, residential, commercial, limited access, and over 100 specific location types. This information helps reduce shipping costs and ensure timely and accurate delivery. With HighlanderTek, the customer, shipper, carrier, and driver all win.
Today, nearly anything can be delivered to your home—your weekly groceries, packages from retailers, exercise equipment, home appliances, furniture, and even a pint of ice cream from your favorite creamery to make everything better after a long day.
The convenience factor is fantastic for a recipient, but put yourself in the driver’s shoes. All you have is an address entered into your GPS. Your navigation will guide you to the general location of the address, but then what? If it’s a private residence, it’s probably easy to figure out where exactly to deliver the item. Other locations, however, can spur some head-scratching.

The challenge: Inadequate location data caused a multitude of shipping issues

Over 50% of the shipping cost for a product is in the last mile due to the time it takes to make the delivery.
Why? Because you need to have a good address, spelled correctly and with all of its parts. Otherwise, you can’t know the exact location something is shipping to. Unfortunately, not everyone understands all the different parts of an address and why each part is important. The most commonly missed address parts include directional prefixes and suffixes, as well as secondary address data.
For example, an address might say "Peachtree St" but they meant "W Peachtree St." Or an address will be provided without secondary information, such as an apartment unit or office suite.
In these situations, drivers are often expected to just figure it out and magically make the delivery on time on the first try. Anyone who’s ordered something online knows that doesn’t always happen.
Because of this, parcel delivery companies, like FedEx and UPS now bill an Address Correction Charge of $13.40 to $21.00. However, LTL carriers don’t. Instead, they spend a lot of time correcting addresses or figuring out where to make the delivery—at their own expense.
"HighlanderTek’s goal is to provide delivery companies with information about each address so they can apply the correct Service Time for the location and make sure the product arrives on time," said Dyrc McLeod, Founder & CEO of HighlanderTek. "We also provide the driver with all the information they need to make the delivery as fast as possible."
This starts with a clean address and a Location Type.
Is the address a private residence, apartment, shopping center, office building, distribution center, or something else? These location types are essential for shippers to get an accurate quote for their shipment.
For example, parcel shipment carriers charge more for a Residential delivery versus a Commercial one. LTL shipment carriers charge significantly more for deliveries to locations like private residences, apartments, churches, schools, and self-storage facilities because these deliveries take more time.
There are over 50 different location types that incur an accessorial charge. However, these accessorial charges are only indicated on the quote if the shipper checks a certain box. Often shippers don’t know what the location is or choose not to check the box, so the initial quote is lower. Either way, they end up with an invoice that’s higher than the original quote.
Knowing the location type can prevent a mismatch between quote and invoice, as well as give the driver more information about their destination so they can prepare for any difficulties the location type might cause.

The solution: Address validation and geocoding improves cost estimation and driver routing

The first thing HighlanderTek does is clean and standardize addresses with Smarty’s US Address Verification.

McLeod had used Smarty address validation at his previous startup company. He appreciated the speed and accuracy of the API, as well as the customer service, so it was an easy decision to implement Smarty address validation at HighlanderTek as well.

"Smarty does a great job of correcting misspelled street names or telling us that a Secondary is required," said McLeod. "The service will also tell you in the response what information was changed or if an address does not exist. Smarty’s address verification does a great job correcting the shippers’ address entries; we can almost always accept the changes and the geocode provided."

"I would love for all our customers to use Smarty’s type ahead address autocomplete," said McLeod."

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Getting correct–or any–secondary addresses is one of our biggest problems, and if our customers were using address autocomplete in their transportation management systems, most of those problems would disappear.
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Dyrc McLeodFounder & CEO of HighlanderTek

Until then, HigherlanderTek will continue relying on Smarty to cleanse and verify those addresses.

Next, HighlanderTek uses Smarty’s US Rooftop Geocoding tool to get the latitude and longitude for each address. These coordinates are plotted into HighlanderTek’s geospatial database, where additional information is added.

Previously, HighlanderTek had tried other location data providers like Google and MapQuest. When Smarty released its geocoding tool, HighlanderTek tested it against Google.

"Google will geocode any address, even ones that don’t exist," said McLeod. "That doesn’t work for us. If the address does not exist, we need to tell the customer that the address does not exist."

Smarty identifies bad addresses so HighlanderTek can ask the customer for a correction, and it only geocodes real addresses. In addition to those two advantages, there were also cost savings when switching from Google to an unlimited plan with Smarty.

The results: Fewer unknown addresses and a fast turnaround time lead to happy customers all around

"When we get a bad geocode and don’t know exactly the location of the address, we return ‘Unknown’ to the customers," said McLeod. "Thanks to Smarty’s precise geocodes and standardized address format, we’ve gone from 25 percent unknown to 2 or 3 percent unknown. Smarty even does a great job geocoding Secondary addresses."

chart showing 25% unknown addresses existed before Smarty and only 3% after Smarty

"Implementation was very easy, but if we had a question, we were always able to get someone on the phone and get it resolved."

A good example of that is an issue HighlanderTek discovered involving addresses for the 5 boroughs in New York City. The street numbers have dashes in them. Smarty was getting the geocodes wrong if the dash was missing in the API request. "I had a conversation with the product team, and they started correcting these right away," said McLeod.

In addition to reducing unknown addresses, HighlanderTek and their customers benefit from the speed of Smarty’s API. Their customers tend to all hit the API at the same time when doing nightly billing. Speed is everything to their customers, and thanks to Smarty’s cloud-based infrastructure and ability to spin up new servers instantly, HighlanderTek has no issues dealing with this load.

Thanks to Smarty address verification and geocoding, HighlanderTek has accurate addresses to build the foundation of its Location Intelligence Platform for shippers, carriers, and drivers.

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Implementation was very easy, but if we had a question, we were always able to get someone on the phone and get it resolved.
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Dyrc McLeodFounder & CEO of HighlanderTek
Delivery person handing a package to a woman at the front door of her house.