People in shipper organizations wonder if they need to postpone road tenders as there is talk about capacity issues everywhere and apparently carriers don’t respond to tenders. The worry is right as the logistics world has changed but of course, you should tender if you feel like it.
The fact is that it should not be such a big deal to do a tender. But for many companies it is as they don’t have good data, have no tech or platform to run a tender or lack the resources. So technology is needed if you want to be agile in logistics procurement.
So what about the carriers? Well, shippers tend to invite the usual suspects which means the big names and the companies they know, of course, they are busy and overloaded as everyone and their mom contacts them.
Shortage of road transport capacity
The shortage of road transport capacity in Europe continues, resulting in high rates on the spot market while available capacity remains at a low level, especially in the automotive sector.
Shortages of truck capacity in Europe continue, resulting in high rates on the spot market while available capacity remains at low levels, especially in the automotive sector. This development is due to many factors and creates inflationary pressure on the economy, which may slow down the recovery. On the supply side, we expect more capacity to become available in the market again – but the demand side is equally important.
In July 2021, the index for road transport capacity in Europe remains at a low level of 76.7 points. Compared to June 2021, available capacity decreased slightly by -1.4 per cent. However, compared to July 2020, there was -26.9 per cent less transport capacity available on the spot market. Prices showed little fluctuation but remained at a high level.
Questions shippers need to ask!
With a growing lack of capacity, SHIPPERS will need to re-think their approach to carriers who will cherry-pick their customers.
Questions to ask:
• How will you strengthen relationships with carriers?
• Where do you find new carriers?
• How do you make your freight flows fit carrier appetite?
• How will you better manage carrier partnerships?
More about LTL and FTL, tenders and logistics costs
Shippers need access to the smaller carriers who you cannot easily find but who actually pass their factories and DC’s all the time yet cannot get the shipper’s business as many shippers have no time and tools to vet carriers or to simply search for them and small carriers themselves do not have the resources in sales or marketing to go beyond their local area or their own network. Catch 22. But it does not have to be like that.
All it takes is a change of mind…
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