Don’t Leave Out These Two Groups in Your Next RFP

More is Less When Preparing for a Successful RFP

Tim Dalton, Procurement Manager

As a procurement manager, I’ve heard this question often: “When will the market change?” After reviewing what the experts and carriers are saying, it appears the market will tighten and rates will increase the closer that we get to the end of 2017 (due to steady increase of regulatory drag).

But there is never a guarantee, and to ensure you don’t get caught by surprise, the state of the market needs to be closely monitored.  Continue to talk to your carriers, talk to other shippers/partners, review the industry reporting, and most importantly…continue to be a good partner to your carriers.  A relationship on its own will not prevent you from taking a rate increase when the market tightens but loyalty/commitments are more likely to be honored if you have remained a good partner while the market was “soft”.

Read Tim’s blog post: Creating carrier partnerships is key to procurement success.

When asked how are things looking today…at the moment, I see opportunities to save money while still making long-term decisions you believe in by continuing to focus on your incumbent carriers. So how can loyalty, partnership, and collaboration contribute to the success of an RFP?

Depending on the shipper and who tenders the freight (centralized team vs. decentralized), we have seen shippers struggle with implementing the results of their RFP, or with getting the data into their system, because they didn’t include the appropriate people in the RFP prep and/or decision-making process.  Don’t leave out these two groups in your next RFP:

Prep Stage

  1. Load Coordinators (or anyone else who “tenders” freight i.e., warehouse associates)

    • Review lanes that are being considered to bid and solicit information pertaining to:
      • Any lane nuances that need to be communicated to the carriers prior to bidding
      • Any drop trailer requirements
      • Any “key” customers that require high-performing carriers
      • Any lanes that should be excluded from consideration
  1. Systems Administrator (the associate(s) that manages your TMS)

    • Ensure they are aware of your timeline, how the lanes are to be presented/awarded to carriers, and the modes/equipment that you will be soliciting rates for to ensure it aligns with your current system setup. This step also gives them ample time to make any necessary changes based on your strategy.

Award Stage

  1. Load Coordinators

    • Whether you include the coordinators in the initial lane-by-lane rate review or after your initial review has been completed, it is important to allow your team to review those “earmarked” awards before they are communicated to your carriers. The benefits include:
      1. Team buy-in – if you allow the coordinators to have a voice in a solution, it makes it easier to get them to manage/work with those carriers that have been awarded primary status vs. discounting an award if a carrier doesn’t take the first load (especially in areas where an award went to someone who is not the “usual” carrier).
      2. Feedback – Allow the team to have a voice  to speak to any nuances and to provide recommendations as to conducting carrier calls, etc. to ensure that all understand the overall/lane recommendations.
      3. Understand motivation Speak to any new carriers that will be added to the network so they get to know the carriers and why they were brought in vs. a new carrier just being a name on a page.
  2. Systems Administrator

    • Communicate any new carriers that will be awarded freight so the systems administrator has ample time to solicit any necessary information to ensure they are set-up in your tendering and financial systems; this will help to eliminate any delays once you implement your solution.

Running a successful RFP isn’t as simple as just sending out your lanes…it requires strategy, ample prep work (collaboration, document review, lane scrubbing, etc.), and ensuring that you are doing all that you can to accurately portray your business so the carriers know what they are bidding on.  As with anything…communication is key.

Want to learn more? Watch this Talking Logistics episode where Tim shares best practices for procurement success.

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Posted in Blog
Tagged LeanLogistics, LeanTMS, Logistics, Managed Procurement, Procurement, Thought Leaders, TMS, Transportation, transportation management system

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