Insights

Supply Chain Optimization: Strike While The Iron is Hot

Timing is everything. For the past few years, many companies have been in survival mode, weathering the supply chain storm that came with the Pandemic and heightened geo-political upheaval. But as the WSJ notes in their latest Logistics Report, the storm may finally be breaking. Businesses across various industries are starting to see an easing of supply chain issues, notably that freight congestion is beginning to clear and shipping prices are finally falling. What has been a pre-dominantly carrier advantaged market is shifting back towards the shippers. 

And that means it’s time to strike. 

For companies that have been holding back on releasing freight RFP’s or renegotiating contracts, now is the time. As Asian manufacturing stabilizes, giving decision makers more bandwidth to focus on domestic shipping rates, the market is primed for supply chain optimization projects. Increased freight capacity also means carriers will be looking to add new business, meaning they’ll be more open to negotiate. 

The caveat for business owners trying to make the most of their supply chain optimization project is that carrier contracts and shipping rates are wildly complicated, intentionally so. Having a partner like Zero Down to help navigate the waters can simplify things in a few ways: 

  • Including the Right Carriers: In the parcel space, the national duopoly maintains their market advantage partly due to the fact that they are able to convince shippers there is in fact a national duopoly. But regional carriers can provide a competitive shipping option, often times at a cheaper price. Knowing all the possible partners to include in an RFP or bid project from the start can end up making all the difference. 
  • Automating the Bid Process: As we said before, timing is everything. Unfortunately, many companies simply don’t have an abundance of it to spend on negotiations, and the carriers are counting on that. Managing multiple lines of communication and sifting through numerous proposals takes time, energy and expertise, so having a partner who can provide all three levels the playing field. 
  • Analyzing with Accuracy: Finally, carrier contracts and freight proposals are really, really complicated. There are many different levers included in the verbiage and pricing, so that when the carriers adjust one here or make subtle tweaks there, they can keep their profits intact. Being able to accurately manipulate large data sets and knowing where to look for savings can have a massive impact on the final product. 

Forging a beneficial carrier portfolio takes knowing when, and where, to strike. The transportation market is seeing a shift back towards the shippers, and that means now is the time to take full advantage. If you’re interested in optimizing the profits and efficiency of your supply chain, reach out to us today, and we’ll help you put the hammer down. 

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