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.
TenderTool Freight Sourcing
It does not have to be this way. At TenderTool 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
- 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
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