Road Freight: How to improve your FTL tenders

Road Freight Tenders blog

In the first quarter of the year, many shippers review their current (road) transportation contracts. But how do you know it is time to issue a road freight RFP? And what are the current best E-Sourcing practices?

Transportation is of vital importance to many companies. But the way tender processes are built often leave much to desire for. In many cases, this is because shippers extremely emphasize their own internal RFP process, without taking suppliers into account that must follow their process.

This comes as no surprise. In general, all logistics procurement professionals will agree that Freight RFP’s are time-absorbing, complex and analytical wrecking balls. After all, freight tendering is a core activity that requires many hours of full dedication.

In this blog, we highlight factors that indicate it is time to plan a freight tender for road transport. After that, we have listed 4 important points for shippers to consider when they go to the market with a transportation RFP.

When is time to organize a road freight RFP?

It is impossible to come up with a universal answer deciding when it is time to set up a road freight tender/RFP. However, there are general shipping factors that can help. Let’s take a look at factors indicating it is time for a road transportation RFP:

1. Current rates are nearing expiration
2. Spot market usage has substantially increased
3. Business is significantly growing
4. Need for rationalizing your carrier base and build more opportunities/relationships with fewer carriers
5. Network Changes – New Customer Requirements – New Product Launches are planned
6. Known market conditions, risks, or recent changes in capacity availability (loss of incumbent carrier(s) capacity)

4 steps to improve your FTL freight tenders

1. Before you send out the RFP, communicate it with your internal organization. Why? Because the freight rates you are going to nominate eventually will have a major impact on your budget for the year. Not just for one department, but for many. Make sure everyone can track the impact of the tender, at all times.

2. Next to internal communication, think about steps to streamline communication with suppliers. Give a clear explanation of what the tender is about, what the objectives are. Moreover, get personal with you carriers and give them useful feedback. Keep in mind: Carriers only participate in about 50% of the freight tenders they receive. The easier you make it for you suppliers, the more rewarding your FTL freight RFP will be.

3. Thoroughly analyze freight rate proposals. Many shippers find trouble in analyzing and streamlining multiple supplier proposals, they only focus on key lanes and weight breaks that represent the majority of the scope. The big issue is that carriers actually know this and act upon it. What happens next is an alluring offer with discounts on major lanes. Meanwhile, the ‘less attractive lanes’ are ignored, negatively influencing your savings. Implement a solution to analyze the tender as a whole. Look for solutions that allow you to source on cost, service, scorecard and custom levels.

Freightender Tip: Don’t forget to benchmark your freight rates 6 months after your road tender is completed. Because freight conditions change, volumes change, it is hardly possible to keep track if you actually reduces transportation costs.

4. Validate your freight invoices! How else are you going to ensure your achieved savings? Most companies do not audit their invoices.  And procurement only cares about the “assumed savings”. Get in touch with a freight audit provider and secure your savings!

About Freightender – E-sourcing the cloud

Freightender was founded in 2016 and is rapidly becoming the standard in road, ocean, distribution, and air tenders. With our end-to-end solution, fully dedicated to the transportation industry, we automate Excel-related exercises around tenders. Furthermore, we improve communication flows. We also offer a full reporting and analysis suite for instant tender intelligence.

If you would like to see a demo of our solution, please leave your details in the form below and we contact you as soon as possible.

[forminator_form id=”10464″]

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!

Schedule Demo Freight Sourcing

Schedule Demo RFQ Management

Freight Auditing: a critical component of the solution, not just a marketing gimmick.

Auditing invoices in logistics is not sexy, but it offers a key to many challenges. In this article, I dive into this somewhat obscure niche. What is freight auditing? So what is freight auditing? It's simply the conceptual term for various processes performed to...

NVOCC pricing vs Freight Forwarder pricing

Is the distinction between NVOCCs and freight forwarders significant? This is a common question, therefore we decided to investigate it further in the following post. Read on to learn everything there is to know about NVOCCs, including their responsibilities,...

Road freight tenders: postpone due capacity crisis in logistics?

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...

Pricing management in Logistics: Lever with the highest impact on profit

The relevance of profitable freight and logistics pricing strategies is highlighted by the combined effects of increasing industry competitiveness and rising transportation costs. By now the logistics industry is in turmoil for well over a year with no relief in sight...

Tender Management: Why the future is digital

Customers want to acquire freight or negotiate freight rates, so they send out a tender or RFQ to a group of forwarders or carriers who wish to participate in the process. This is straightforward and transparent. The process behind it is less visible and can be found...

New record prices for shipping containers Shanghai – Rotterdam

Prices for containers are going through the roof (and they were already so high)International container traffic is still disrupted. Containers are extremely expensive. The fact that a major Chinese port has reopened does little to change that.The cost of shipping a...

Demand for logistics procurement software is increasing dramatically in 2021

The logistics business has been in crisis for well over a year, with no signs of relief in sight as freight prices continue to increase and capacity constraints worsen. Logistics is a somewhat arcane and opaque profession to most people, but it has recently gained...

Freightender and Drewry partner to bring all-in-one ocean freight procurement

Global shipping consultancy, Drewry and Freightender are pleased to announce they have entered a value-add partnership, combining Drewry’s industry-leading ocean freight cost benchmarking and procurement support services with Freightender’s cloud-based,...

Freightender Podcast: Digitization in Logistics and Procurement

Pieter Kinds, founder and CEO of Freightender, in conversation with Martijn Graat, founder of LogisticsMatter, a leading online supply chain and logistics news platform from the Netherlands. Podcast: Digitization in Logistics and the Procurement of Freight The...

Ocean capacity crunch fuels the importance of modern logistics software

Ongoing extreme events that impact global trade and logistics keep on happening and require logistics teams to be more flexible and agile to handle chaos and the unforeseen. While strategic thinking is very much required, tactical action is key. The right partnerships...
Let us help you!Setting up a good tender template for your freight sourcing events is not easy!

We are happy to offer you FREE & customized advice on your tender template or rate card. For Air, Ocean, LTL and FTL. If you would like to make use of our free analysis please leave your contact details and we will contact you shortly.