“Companies Spent a Record $1.5 TRILLION on Shipping Costs in 2017” blares the headline from the Wall Street Journal Logistics Report article. Up a whopping 6.2% from the year before, shippers have been absorbing the costs of rising interest rates and labor costs, higher fuel costs, and soon, high tariffs on imported goods. The pace of cost increases is unsustainable. Supply chain experts point to broader carrier relationship development as critical to surviving and remaining competitive. Here’s 3 ways a TMS platform including the latest supply chain management solutions are precisely what shippers need to accomplish this goal.
Using TMS and route optimizers to plan more efficient shipments, a shipper can significantly reduce lead times and shrink dwell times. They also avoid the chronic change orders that are a result of insufficiently robust planning and time consuming manual processes. With capacity super tight, carriers are able to be as selective as they want to be and they’re always going to accept tenders first from shippers who provides longer lead times and fewer instances of change orders.
Supporting Stronger Carrier Management & Contract Negotiation
The visibility and control afforded by having freight data well-organized and accessible within a robust TMS platform allows a shipper to better align their shipping needs with the most appropriate carrier in any given lane and for any given freight class. If your freight characteristics are not aligned with the model favored by a particular carrier, they will reject your tenders in favor of freight that better matches their model. When negotiating rates, a shipper with a good TMS can organize the carrier base according to best-match characteristics and ensure they’re tendering to the right carriers.
Moreover, with the time saved via the automation of time-consuming manual processes – and leveraging the reporting functionality TMS delivers – shippers can be much more targeted and effective in contract negotiations with carriers resulting in higher tender acceptance rates and more reliable access to well-serviced carrier relationships.
Consistently Providing Timely Scheduling of Pickups/Deliveries
With new, more stringent hours of service rules being more effectively policed thanks to the ELD mandate, it is more important than ever for pickup and delivery times to be scheduled with as little delay as possible for drivers at origin or destination. Shippers using advanced scheduling technology within their TMS are able to exert exceptional control over the throughput at DCs and plants. With the ability to schedule dock doors in real time using a cloud-based appointment and scheduling solution, and integrated yard management tools to ensure timely movement of assets in the yard, shippers can maximize the efficiency of their operations and minimize the amount of time drivers waste waiting for dock access.
Taken altogether, these three TMS platform-driven solutions can help a shipper achieve and maintain “shipper of choice” status with their selected carriers. In today’s environment, this is worth its weight in gold!