Consumer demands surrounding product availability, shipping times and visibility into orders have grown significantly over the past several years. As a result, the price — both in dollars and damaged reputation — of late or damaged deliveries has skyrocketed. Meeting these demands is a team effort that involves shippers, carriers, retailers and technology providers.
While meeting consumer demands can be a consistent challenge, service hiccups are most likely to occur during demand surges. Shippers can often predict when these surges will occur, whether it be during peak retail season or a promotional event that draws in customers.
In these instances, shippers can partner with technology providers like Emerge to conduct procurement events right before expected volatility, enabling them to secure extra capacity based on the most accurate volume forecasts. This is crucial because a shipper’s existing carrier partners will not always be able to flex up to accommodate a swift burst of demand.
“A successful, tried and true strategy to overcome this is to partner with a freight marketplace. This will give the shipper greater visibility to capacity and in a very expedited way,” Mark McEntire, senior vice president of strategic operations and sales development for Emerge, said. “The right marketplace will provide rate and service benchmarking inside the product, as well as transparent visibility to the cost of added capacity. It will improve response and processing times and avoid any negative impact on consumer-facing operations.”
When it comes to meeting the needs of high-demand customers, especially consumer-facing retail businesses, shippers should ensure they are partnering with dependable, service-minded carriers, not necessarily the carriers offering their services at the lowest prices.
“Reliability, capacity and stability are all important measures of a great carrier partner,” McEntire said. “It is, however, a two-way street. The shipper must also be reliable with volumes and communication.”
In order to evaluate whether their existing transportation providers are a good fit, shippers must invest in the relationship themselves. That means spending time listening to carriers, implementing improvements, measuring performance and rewarding successful behaviors. Shippers should also seek out service benchmarking from a high-quality technology provider, allowing them to identify what is and isn’t working with existing carriers, as well as pinpoint new carriers well suited to meet their needs.
When a shipper has taken all of these steps and still identified an underperforming carrier in its network, that doesn’t necessarily mean it is time to cut ties entirely.
“Shippers need carriers, like we need air. I believe the best philosophy is rehabilitation versus fire and forget,” McEntire said. “Communication should always include clearly stated requirements and expectations from the shipper. Along with this, a shipper should use and share a carrier scorecard so both parties are aligned on performance.”
Carriers must grapple with a wide array of definitions of “on-time performance” from different shippers. At the same time, shippers must navigate differing retailer requirements when servicing their own customers. These inconsistent definitions can lead to confusion for everyone, making service issues more likely to occur.
“Not all retailer requirements are created equally. Some allow flexibility around the delivery date. Others expect delivery on a day — not a day early or a day late,” McEntire said. “This can be counterintuitive for carriers. For carriers, it is all about utilization, and historically, it was applauded for early deliveries. Retailers want predictability and they want to preserve floor space in the store, in the back room and in their distribution centers. On time, in full is all about predictability and flow. ”
Opening up conversations around expectations can clear up any existing misunderstanding between parties, making it easier to work through any service issues shippers identify while preserving existing relationships.
It is, of course, not always possible to align on expectations. Once open communication has been established and all performance improvement routes have been exhausted, there is not much else a shipper can do to improve a relationship with a carrier.
“In the end, on-time performance and tender acceptance win the day,” McEntire said. “If a carrier is struggling on lanes, and the shipper has tried to rehabilitate, then changes must occur. It’s too important and costly not to make changes.”
When it is time to make a change, companies like Emerge can help shippers fill in the gaps in their network through high-quality, prescreened freight marketplaces that exist to pair shippers with the right carriers for them.
Whether a specific relationship can be salvaged or not, it is crucial that a shipper’s entire team is involved in communicating expectations and definitions with carriers in order to create an environment of success.
“Shippers should lean into this and have a formalized strategy, shared with the entire organization,” McEntire said. “This challenge is a team sport, not one department is responsible.”
