{"id":2106,"date":"2024-06-07T15:16:11","date_gmt":"2024-06-07T19:16:11","guid":{"rendered":"https:\/\/www.dantranscon.com\/?p=2106"},"modified":"2024-06-07T15:16:11","modified_gmt":"2024-06-07T19:16:11","slug":"conducting-a-freight-bid-should-we-do-it-ourselves-or-seek-outside-help","status":"publish","type":"post","link":"https:\/\/www.dantranscon.com\/conducting-a-freight-bid-should-we-do-it-ourselves-or-seek-outside-help\/","title":{"rendered":"Conducting a Freight Bid \u2013 Should We Do It Ourselves or Seek Outside Help?"},"content":{"rendered":"<p>As outlined in previous blogs, most companies conduct a freight bid to achieve certain objectives.\u00a0 These may include saving money on shipping costs, upgrading the quality of their carriers, and\/or improving service.\u00a0 Success can be measured in terms of a reduction in freight expenses, higher on-time service, greater customer satisfaction, or other metrics.<\/p>\n<p>To achieve quantifiable improvements, the project team must have the skills and resources to effectively plan and execute a project of this nature.\u00a0 Companies conduct these projects either internally or externally depending on whether they are equipped to do so.<\/p>\n<p>It has been our experience that some companies attain less than optimum results by not fully appreciating what is involved in conducting a successful freight bid.\u00a0 Here are some items to consider.<\/p>\n<ol>\n<li><strong>Quality Data<\/strong><\/li>\n<\/ol>\n<p>To prepare competitive rates, carriers need to be supplied with complete, accurate data on their shippers\u2019 lanes, volumes, and modes.\u00a0 Six months to a year of detailed shipping data is typically the minimum requirement.\u00a0 A failure to provide carriers with quality data during the bid process can result in unscheduled rate increases or a need to find alternate carriers.<\/p>\n<ol start=\"2\">\n<li><strong>Extensive Database of Carriers<\/strong><\/li>\n<\/ol>\n<p>One of the mistakes we have seen some shippers make is to continually contact the same carriers every year.\u00a0 This limits opportunities to identify potentially superior partners and reduces the prospects of securing more competitive pricing.\u00a0 It is essential that each shipper cast a wide net to secure asset and non-asset-based companies that can meet their needs.<\/p>\n<ol start=\"3\">\n<li><strong>Effective Data Analysis Tools<\/strong><\/li>\n<\/ol>\n<p>There is a considerable amount of data transmission during a bid.\u00a0 There is also a requirement to be able to create the data templates, and to upload, analyze and massage the data; there is a requirement to rank the carrier rates and other data elements in an expeditious manner, under varying geographically scenarios.\u00a0 Some shippers don\u2019t have the analytical tools to perform these tasks in a timely manner.<\/p>\n<ol start=\"4\">\n<li><strong>Adequate Freight Transportation Knowledge<\/strong><\/li>\n<\/ol>\n<p>Shippers need to understand the range of options available to move their freight.\u00a0 As the years go by, shipping patterns and volumes may evolve.\u00a0 Shippers may be able to consolidate volumes at origin or deconsolidate partial or full loads at destination.\u00a0 For some lanes, intermodal shipping may be a cost-effective option to over the road shipping.<\/p>\n<p>Transportation Managers also need to have a solid grasp of the additional services that may be triggering accessorial charges. They need to be able to assess if there are some supply chain deficiencies that are causing detention charges or late deliveries, before putting their freight out for bid.<\/p>\n<ol start=\"5\">\n<li><strong>Carrier Management and Negotiating Skills<\/strong><\/li>\n<\/ol>\n<p>In every bid, there is a requirement to do a \u201cdeep dive\u201d into the operations of at least some new and existing carriers, to evaluate opportunities for improvement and to see if they are a fit with the company\u2019s operations.\u00a0 There is a necessity to conduct thoughtful discussions with each carrier to look for situations where service improvements can be made and where leveraging volumes can lead to further cost savings.\u00a0 There is also a prerequisite to discuss and negotiate all aspects of freight pricing in a meaningful way.<\/p>\n<ol start=\"6\">\n<li><strong>Post-Bid Compliance Skills<\/strong><\/li>\n<\/ol>\n<p>Many shippers operate under the belief that once the bidding process is complete, the project is over.\u00a0 It isn\u2019t.\u00a0 The effective execution of a bid is essential to achieving the project\u2019s objectives.\u00a0 For certain carriers, it may be beneficial to sign contractual agreements with measurable expectations, and progressive discipline clauses, to ensure compliance and performance.\u00a0 A set of KPIs, scorecards, a routing guide, and scheduled carrier meetings, are also essential to manage the carrier compliance process.<\/p>\n<p>To conduct a successful bid, to effectively manage and control freight transportation expenses, each manufacturer and distributor needs to evaluate if they have the skills and resources internally or seek outside assistance.\u00a0 If not, there are a range of options available to them.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>To stay up to date on <strong>Best Practices in Freight Management<\/strong>, follow me on <strong>X<\/strong> (formerly Twitter)<strong> @DanGoodwill<\/strong> and join the <strong>Freight Management Best Practices<\/strong> group on <strong>LinkedIn<\/strong>. If you are looking for ways to improve the effectiveness of your freight management processes, to save money on freight, or to conduct a freight bid, contact me at dan@dantranscon.com.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>As outlined in previous blogs, most companies conduct a freight bid to achieve certain objectives.\u00a0 These may include saving money on shipping costs, upgrading the quality of their carriers, and\/or improving service.\u00a0 Success can be measured in terms of a reduction in freight expenses, higher on-time service, greater customer satisfaction, or other metrics. To achieve [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":2107,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[78,65,64,59,54,77,51,1],"tags":[161,204,245,235,177,83,244,152,109,179,178],"class_list":["post-2106","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-best-practices-in-freight-management","category-freight-bids","category-freight-cost-savings","category-freight-rate-pricing","category-intermodal","category-ltl-freight","category-truckload-transportation","category-uncategorized","tag-finance-and-transportation","tag-financial-management","tag-freight-bid","tag-freight-costs","tag-freight-management","tag-freight-rates","tag-freight-rfp","tag-freight-transportation","tag-intermodal","tag-ltl","tag-truckload"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Conducting a Freight Bid \u2013 Should We Do It Ourselves or Seek Outside Help? - DG&amp;A Freight Consultants<\/title>\n<meta name=\"description\" content=\"To achieve quantifiable improvements, the project team must possess the skills and resources to effectively plan and execute a project of this nature. 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