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6 TRANSPORTATION SOURCING TIPS - CHOOSING A CARRIER



1. PAY ATTENTION TO VALUE, NOT PRICE

Cost, transportation time, vendor quality, dependability, customer service, and other aspects will all be considered as part of value, which will go beyond what pricing alone can tell you. When evaluating bids, it's also crucial to take risk into account when discussing price.

Certain modes are riskier than others. For instance, using air freight instead of the more commoditized ocean freight will enable you to deliver pricey equipment from China more swiftly and with greater care.


2. CONSIDER CAPABILITY.

There is less LTL capacity at specific periods of the month, which raises motor freight pricing and reduces its profitability. Additionally, in some circumstances, the necessary capacity does not naturally exist.


3. IDENTIFY THE CARRIER'S COMFORT ZONE.

Always ask the carriers which lane they use the most.

All carriers have expertise in some sectors over others. You can negotiate a better price after you discover their sweet spot.

Any reliable carrier will have certain markets and niches where they thrive in terms of pricing and customer service, as well as other areas where they fall short. A localized LTL carrier, for instance, won't be as competitive with cross-country shipments.


4. APPLY TECHNOLOGY

When you start using an internet service that connects shippers and carriers, you can reduce your transportation expenditure by 70%.

Your alternatives expand when you move away from a single carrier approach to utilising technology.

You're undoubtedly paying too much if you don't use a transportation management system (TMS).

With the use of technology, businesses can forecast how different transportation options will affect the supply chain. By including all cost factors across all functional parts, you can build a true end-to-end digital model of your supply chain. Even better, you can perform a "what if" analysis to see how choosing one mode over another will affect sourcing or customer service.

5. MAKE PLANS.


Always make plans in advance because the longer you wait, the more the market will control you and drive you to become a price taker rather than a price chooser.

Run a well-planned pilot program before switching carriers.

It won't be a fair evaluation unless you only intend to use that carrier in crises if you deliver them an urgent shipment that nobody else would accept.


6. VERIFY REFERENCES

Consider more than the carrier's references. Only references you can independently verify without disclosing to the carrier are useful.

In the end, the majority of transportation experts concur that knowing a carrier's and a mode's capabilities can help logistics professionals source transportation in an informed manner.

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