Follow us on Twitter!
Blog Header Logo
DG&A's Transportation Consulting Blog
Posted by on in Freight Bids
  • Font size: Larger Smaller
  • Hits: 2871
  • 0 Comments
  • Print

Freight Carriers - How to Achieve Success with Freight Bids – Part 2

 

 

b2ap3_thumbnail_bidding-sites.jpg

In my last blog, I outlined a set of tips to help carriers achieve greater success with Freight Bids. Here are a few more.

Put your best foot forward early in the process

We observe both incumbent and new carriers hold back on their pricing to see where they need to be at the end of round 1. The risk with this approach is that the company may not survive round 1. If you wish to maintain an existing account or secure a new one, go for it. Shippers understand that carriers need to earn a reasonable profit. But carriers that end round 1 near the bottom of the rankings are mostly likely to be dismissed early.

Submit Your Bid on Time

Assign the task of preparing your company’s bid response early and make sure you submit a well thought out bid on time. Some companies treat freight bids like some students treat term papers. They look at the bid in the final few days and then rush to meet the deadline. This can lead to problems.

Check the Math

Many companies forward the “number-crunching” part of the bid to a junior Pricing Analyst. The bid may or may not be reviewed by a more senior Pricing Manager (i.e. Director of Pricing) before it is forwarded to the shipper or the shipper’s negotiating agent. Sometimes the bid will contain mistakes that can be attributed to a lack of attention to detail or a misreading of the bid. In some cases, the bid submission contains errors in arithmetic. Check the math in your bid before it is sent to the shipper.

Communicate Your Company's “Value Proposition”

In certain bid packages, there is a group of questions that address a broad array of variables (i.e. on time service, claims ratio, operating ratio, size and age of fleet etc.). The answers to these questions provide a good insight into the carriers’ ability to serve the needs of the shipper. Carriers are encouraged to develop a “boilerplate” proposal that can be customized to the requirements of each shipper. Use this document to present a compelling story on why your company can best meet the needs of the shipper.

For example, if you have broader direct service coverage in the province of Quebec, make sure you tell the shipper. If your on-time service performance or claims ratio is superior to industry standards, don’t be shy to mention it. If you aren’t sure what the company is looking for, send the shipper an e mail and ask some questions. If you wish to be successful, do your due diligence and present a bid response that directly addresses the needs of the shipper.

Be Prepared for Multiple Rounds of Negotiations

In many bids, there is a requirement for multiple rounds of negotiations. It is only after the bids are in that opportunities to negotiate with selected carriers become apparent. Volume discounts and negotiations on accessorial charges (including fuel surcharges) may be left to the negotiation rounds. Those carriers that take a position of arrogance or inflexibility risk being left “out in the cold.” We encourage carriers to think through their “end game strategy” and be prepared to negotiate a “Win Win” contract with a desirable shipper. Be professional; don’t spread unfounded industry rumors and bad mouth the competition.

If you are Awarded Business, Focus carefully on the Implementation

During the early stages of the process, the carrier’s Pricing and Sales groups are most engaged. Once the business is awarded, it is essential that the Operations team gets directly involved. This is the time when the Terminal Manager or the Director of Operations should accompany the Account Manager to meet the prospective client. There should be a clear understanding of the shipper’s requirements (i.e. pick up time, equipment required for pick up, number of trailers in the yard, cut off times etc). There are carriers that make it to this stage only to “blow the account” by not meeting the shipper’s service expectations.

Since this is a period of vulnerability for the Transportation Manager, a carrier that falls down may cause this individual to run back to the incumbent carrier and negotiate a revised pricing proposal. All the time and effort that was devoted to the preparation of the bid, selling the shipper on the value of the company and negotiating the rates will be lost if the shipper loses confidence in the carrier at this stage.

 

To stay up to date on Best Practices in Freight Management, follow me on Twitter @DanGoodwill, join the Freight Management Best Practices group on LinkedIn and subscribe to Dan’s Transportation Newspaper (http://paper.li/DanGoodwill/1342211466).

0

Comments

  • No comments made yet. Be the first to submit a comment

Leave your comment

Guest Thursday, 28 March 2024

Most Recent Posts

Search


Tag Cloud

Yield Improvement TransForce Transplace CITA Shipper Pulse Survey tanker cars Facebook dynamic pricing Harper Davos speech FMS LTL shipper-carrier roundtable Montreal Canadiens Right Shoring Driving for Profit Government Trump Carriers Job satisfaction Trucker Protest Covid-19 Sales Strategy BNSF 2013 Economic Forecast freight cost savings cyber security freight payment Social Media Politics Comey Reshoring 3PL Canada trucking company acquisitions Toronto Maple Leafs Derek Singleton Failure FCPC FCA Blogging freight transportation conference Transportation Buying Trends Survey computer Social Media in Transportation dark stores economic forecasts for 2012 Impeachment Sales Management 2012 Transportation Business Strategies. Jugaad Canada U.S. trade truck capacity mentoring Rate per Mile NMFC small business customer engagement US Manufacturing Freight Carriers Association of Canada BlueGrace Logistics bulk shipping IANA FuelQuest business security 2014 freight forecast CP Rail Conway Load broker Freight Shuttle System Habs MBA autos Packaging Freight Rates Hockey Leadership Amazon Cleveland Cavaliers natural disasters 2014 freight volumes Accessorial Charges Dan Goodwill Success Retail professional drivers transportation audit Deferred Packaging FMCSA Loblaw shipping wine Global Transportation Hub dimensional pricing CSA Career Advice Truckload Global experience YRCW Transloading Schneider Logistics Scott Monty Crisis management solutions provider US Economy US Housing Market Training Leafs Shipper General Motors coaching laptop freight broker Trucking APL cars freight costs Microsoft Rail Transportation service Colilers International Freight contracts freight audit RFP 360ideaspace Map-21 Outsourcing Sales Business skills transportation newspaper shipping Freight Matching Transportation truck driver JB Hunt energy efficiency Sales Training technology Blockchain economic outlook financial management Online grocery shopping Adrian Gonzalez NS CSX Fire Phone Associates carrier conference MPG derailments TMS truck drivers US Election CN Rail LCV's consumer centric freight agreements Bobby Harris autonomous vehicles President Obama computer protection Retail transportation freight forwarders Warehousing Muhammad Ali Canadian economy hiring process KCS Freight Capacity economy Digital Freight Networks Climate Change asset management Search engine optimization Canadian truckers US Auto Sales network optimization Canadian Protests Load Boards Masters in Logistics Freight Management driver home delibery CN transportation news e-commerce peak season UP Werner business start-up the future of transportation Omni Channel Digitization online shopping Canada-U.S. trade agreement YRC CRM LinkedIn freight transportation in 2011 NAFTA Spanx Sales Ferromex Railway Association of Canada buying trucking companies David Tuttle Driver Shortage Whole Foods Distribution Crude Oil by Rail Tracy Matura Toronto TMP Worldwide Swift employee termination Anti-Vax Education fuel surcharge Business Development Regina Celadon capacity shortages home delivery rail safety Consulting last mile delivery intermodal Entrepreneur Doug Davis Management Training New Hires supply chain management CSA scores Software Advice Stephen Harper Trade Vision Otto Horizontal Supply Chain Collaboration future of freight industry Doug Nix capacity shortage shipper-carrier collaboration Uber Freight 3PLTL Emergent Strategy Inbound Transportation trade pipelines Transport Capital Partners (TCP) Dedicated Trucking automation Grocery New York Times Transcom Fleet Leasing Canada's global strategy ELD NCC Business Transformation Strategy Hudsons Bay Company broker security ProMiles computer security Broker Twitter shipper-carrier contracts Keystone Pipeline Value Proposition University of Tennessee Rotman School of Business Freight Recession small parcel marketing Donald Trump 2015 Economic Forecast Tariffs freight rate increases recession EBOR China routing guide robotics freight payment freight audit drones Finance and Transportation Life Lessons driver pay Business Strategy Geopolitics Infrastructure Freight cheap oil ShipMax Success failure entrepreneur driverless Canadian freight market risk management broker bonds freight transportation driver shortages USMCA Electric Vehicles 2014 economic forecast Wal-Mart selling trucking companies digital freight matching freight RFP Justice Coronavirus freight bid freight marketplace USA Truck Canadian Transportation & Logistics Surety bond $75000 bond Dedicated Contract Carriage

Blog Archives

March
February
December
October
September
August
June
May
April
March
January