Choosing from a portfolio of services will help you get product from here to there, and may also send savings straight to the bottom line. Here are seven guidelines to help you find the best carriers for your organization.
As tight market conditions continue to put pressure on the cost and availability of over-the-road transportation providers, carriers are rising to the challenge by creating cost-effective ways to move freight — whether by air, truck, sea, rail or a combination of these modes.
Using a mix of different transportation modes can offer shippers flexible, predictable capacity that aligns with their budget and helps maintain high levels of customer service. By examining organizational needs and matching those needs with the wide range of services available from carriers, shippers can find the best possible solution to meet their transportation requirements.
Long-term Relationships, Flexible Freight Form Foundation for Success
The first step transportation managers need to take when choosing from a portfolio solution is evaluating whether or not it makes sense for their situation. There are a number of criteria that, together, create the impetus for shippers to seek alternative shipping modes.
First, shippers must have the ability to be flexible across modes of transportation, transit time and cost. Does your organization really need to get that shipment to California in three days? If not, an alternate solution could be advantageous for you and your customer. If you can be flexible in when a shipment departs, flexibility and capacity benefits will follow.
Second, shippers must be willing to form long-term relationships with carriers. Transactional buyers — those that make purchasing decisions based on cost alone — may miss out on long-term cost savings and service benefits. Carriers engaged in long-term relationships often go the extra mile to improve customer service, create the most efficient modes and find ways to reduce costs in the supply chain.
What if you've identified that your organization is flexible and wants to form long-term relationships with carriers, but you remain unsure if a multiple mode solution makes sense?
Answering yes to the following questions may clarify your decision:
- Do you have a complex supply chain?
- Do you ship to multiple distribution centers?
- Are you under constant pressure to reduce costs and deliver high service?
- Is your distribution supply chain variable?
- Do your customers have strict and varied on-time requirements?
- Does your organization lack access to the technology and/or capital to help with supply chain optimization?
- Are you being asked to reduce staffing?
Selecting the Best Carriers
Now that you've established that your organization can benefit from a multiple mode solution, selecting the right provider is critical. Following these guidelines can help you find the best carriers for your organization:
1) Put a Portfolio of Services to Work for You
Choose carriers that offer a broad range of services, and most importantly, those that can deliver each of them with excellence. The carriers you select for your organization should be able to demonstrate a proven track record in designing successful solutions that are comparable to your freight needs. Remember, your company's reputation is at stake if shipments are damaged, lost or late. Ask for customer references and evaluate the experience and credentials of potential carriers.
Selecting carriers that offer a broad portfolio of services also provides the opportunity to take advantage of volume savings over the long-term. Often, shippers take a short term approach focused on finding the lowest-priced bid. However, a bid implies that you have perfect knowledge of your needs and that nothing will change during the bid period. If rail service improves, for example, how do you switch from truckload to rail in the middle of a bid? And, comparing bids from an extensive list of carriers that offer various services at different price points is not an easy task. Imagine putting out a bid resulting in 100 responses: 10 can provide multiple mode solutions, 30 have intermodal capabilities; some have full truckload capabilities and still others offer brokerage solutions. Rather than coordinating your shipments among multiple carriers, carriers that offer a range of modes can simplify the process, handle the order from start to finish, and ultimately save you time and money.