There is not a company in business that isn’t concerned about cutting costs especially when it comes to logistics. All companies want to save money on less-than-truckload shipping however at what point is saving money on shipping costing you money on service and disruptions to other elements in the supply chain. Money is only saved when the job is continued without flaw and the shipping is procured at a reduced rate.
If other obstacles are cause by saving money on the actual LTL shipping than you may really be costing the company more money that you are saving it in customer complaints and disruptions to the labor force. The element that a great supply chain management system will look at is lower shipping costs to the point at which they do not interrupt any other aspect of the company’s goals. When everything is working in balance and harmony is achieved your business will then be successful.
To start doing this within your company’s organization it is important that the company set clear objectives and supply chain requirements. Assistance is needed to clearly define LTL shippers bid objectives. These goals may be to reduce costs, reduce the number of carriers involved in the logistics process, quicker movement of shipments or geographic needs that have to be addressed. In order to work with a LTL carrier your company’s needs need to be matched with those of the LTL carrier.
When aligning yourself with a shipper be sure that they have thoroughly addressed and collected valuable data from the carriers that they will be using to meet your LTL needs. A shipper should have up to date, clear information on all carriers such as past financial performance, ratings in customer service, IT capabilities, equipment standards, fleet size and CSA scores. A shipper needs to align themselves with carriers that are interested in carrying out the goals that you have in common for your shipments.
As a company it is important that you review data on your shipper as well as their carriers. All data should be supplied to you in a formal review of the past twelve months of activities.
Don’t align your company with a shipper that has evolved using too many different carriers to achieve results. The best option when it comes to logistics is to create a plan around a shipper that uses a level carrier mix with proven results and limited issues. The more carriers involved in the shipment of goods, the more issues that can arise; including leveraging the demand and volume.
Using due diligence and creating a relationship with your shipper will also help your company grow. Much of logistics revolves around the relationship that you have with the shipper and in turn the shipper has with his suppliers. Good communication, written documentation and an outline of expectations and company goals are crucial when developing this partnership. You and your shipper should work to alert each other to issues arising with carriers to avoid customer service nightmares that can be had from late deliveries, incomplete and insufficient carrier services. If a bump in the road with a carrier is not immediately corrected it will affect your company and the logistics plan that you have worked so hard to develop with the shipper.