Why forwarders and carriers are pricing transportation into oblivion

Carriers are pricing transportation into oblivion

Pricing, quoting, answering to transport tenders, whatever you call the process, is a highly underrated process within many forwarder and carrier organizations. It is a process that is subject to shared responsibilities, geographical (in)differences, political games and different P&L’s. Next to that, the process is severely challenged by the lack of knowledge or understanding of how to price transportation within several areas in any transport organization. Last but not least, often, little or no investment has been made to support the pricing process with technology which leaves e-mail and excel the two main tools to battle tenders with.
 

Adding to this mix is the fact that Shippers often send carriers RFQ’s with:

 

·     Limited or poor data

·     Difficult or unclear instructions

·     Exotic pricing demands

·     Company-specific terminology

·     Too difficult excel structures

 

This makes quoting to tenders in a good way quite challenging and often brings frustrations to all parties involved but especially to the people involved from the forwarder side.

So what happens? The first round of quotation is like more or less pulling a wheel of Fortune to see where you end up relative to other bids so you can adjust accordingly. Only in round 2 things start to become interesting as your potential customer becomes your source of market intel.

 

Freightender Freight Sourcing

 

It does not have to be this way. At Freightender we are at the forefront of managing the quotation process and are engineering a highly intelligent platform that supports forwarders and carriers in their quotation processes by delivering historical tender info right at the doorstep of the next tender to be created.

Visibility, transparency, rates and historical tender data linked to your quotation process means you are on top of your pricing process from round 1.

 

Extra: 10 do’s and don’ts of Freight Sourcing

Do’s

  • Send complete and clear data
  • Contact carriers and state your intent to invite them
  • Use a dedicated freight e-sourcing tool
  • Listen to carrier suggestions and questions
  • Tender in multiple rounds as prices will go down

Don’ts

  • Make the rate card too complex

  • Treat carriers as obedient servants

  • Let people tender that have little logistics knowledge

  • Change and update tender data during the tender

  • Use generic procurement tools

Pieter Kinds

Pieter Kinds

CEO Freightender.com

Freightender is the standard in freight tendering. It makes the tender process lean, smarter and much faster. 
Fully cloud-based. Curious? Request a free live demo and join the Freight Tender Revolution!

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9 crucial tips for your freight RFQBest practice in freight procurement

9 important suggestions based on our experience of working
with 100's of companies on their freight tenders.