Every shipper, manufacturer or trader wants logistics service providers that offer services that seamlessly match their own operations and customer expectations in terms of service, but do not pay more costs than necessary. After all, transport directly affects your customers' satisfaction and your margins; and therefore the continuity of your business. Optimising this starts with procurement. The solution for this is transport tendering.
Transport procurement is a complex and time-consuming business. Each modality has its own challenges. Because transport procurement is not a day-to-day process, many companies have relatively little process and market knowledge. In addition, transport tender software is often not available to gain good insight. Now these very elements are crucial for effective transport procurement.
Transport is essential for customer satisfaction, should fit seamlessly with business operations and transport costs cut directly into margin. Our procurement process aims to optimise quality, service and costs. Together, we first determine what is really needed. Good data, for example from your own TMS helps with this.
We also use input from logistics, sales, production, warehouse, the finance department and customer service. Then we help select carriers. Current partners, of course, but also parties whose network and services we know are a perfect match. We are completely independent in this respect. We have no (commission) agreements with carriers and select the best potential partners for you.
Good selection ensures a high response rate and market competitive bids. With our procurement software, we analyse the bids and present decision information. Our software also provides detailed feedback to participating carriers. Finally, we advise which mix of carriers leads to good coverage of your shipment profile with sufficient flexibility and robustness. Where necessary, we help draw up SLAs and contracts.
Due to the many tenders we do every year and our TMS we gain insight into the market and rates. From a completely independent position, as exports we can link our customers to the best carriers for them.
A good process ensures transparent and homogeneous bids that allow an accurate comparison on both costs but also on all important qualitative aspects. It ensures a fixed and fast turnaround time.
Good tools are half the battle, and this also applies to transport procurement. The way transport rates are offered, with different scales and surcharges, requires specialised software.
Every company is different and a procurement process must therefore be tailored. We provide tailor-made services, from complete unburdening to, for example, only support in comparing rates.
There are many procurement software providers. In procurement (of transport), contact with carriers is crucial. For us, it is not the software we use that is central, but the contact with our customer and the carriers.
The costs for a tender depend on quite a few variables, such as the number of carriers and tariff tables to be processed. If possible and desired, we can arrange a tender on a no cure no pay basis.
Want to learn more about optimising or managing transport? We tell you more in our transport guide!
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We distinguish ourselves with market knowledge and experience combined with our software tools.
Above all, our approach is concrete and pragmatic.
We distinguish ourselves with market knowledge and experience combined with our software tools. Above all, our approach is concrete and pragmatic. We would be happy to discuss your challenges with you and explain, without obligation, how we can support you with our data-driven analyses and/or software applications.
To serve you quickly, we have compiled a list of frequently asked questions. Here you will find concise answers to the most common questions. If you need further information, please do not hesitate to contact us.
A minimum lead time of 3 months must often be taken into account. This then involves a tender with 2 tender rounds. A well-executed tender often requires carriers to take sufficient time to delve into the case and submit rates. Sufficient time should also be allowed for collecting the right information shipment data, preparing tender and feedback documentation and making the scenario analyses. As a result, large projects sometimes take a bit longer.
The cost depends heavily on two aspects. First, the expected service is important. Will the entire tender be taken out of your hands, or will only a specific part of the tender be included? In addition, the scope plays an important role. For how many locations and/or countries should tariffs be requested, and how many carriers will participate in a route? In general, we often see clients realise savings between 10-30%, with outliers to 40% and our record is even close to 50%. If desired, you can work on a performance basis, with no or reduced fixed costs.
Data is crucial when organising a Transport Tender. The better your transport data is the more focused and competitive carriers can bid. We always advise during a tender to share a year's worth of data with detailed information. This is information such as, from where to where, lengths, widths, heights and weight of the shipments. If possible, additional special information such as desired surcharges and particularities. The better the profile fits the carrier's network, the better rates will be issued. If the data is imperfect, the carrier will be cautious and thus build buffers into its rates.
This depends somewhat on the industry in which our client operates, but in general, long-term partnerships are advised. To achieve a good partnership, in which continuous improvement is an essential component, it is usually advisable to think of a partnership period of 3 to 5 years. After this period, it is wise to evaluate what the market has done and whether your rates are still in line with the market.
This strongly depends on the industry in which a company operates, what a shipment profile looks like and what the final scope is. For example, if 1-pallet shipments are always sent within the Netherlands, it makes sense to invite a number of specialised carriers to do so, limiting the number of carriers. However, when shipping from Europe, from multiple countries to different countries, and also involving both small shipments (Groupage) and full trucks (FTL), the number of carriers needed can be as high as 50 or even 100. In any case, what Transinnovate can do is assess a shipment profile and the desired service, and then include the best matching carriers on both cost and quality from the market in your transport tender.
Very briefly, this is market knowledge, process knowledge and unique software. Many companies do not buy transport structurally. As a result, they do not build up market knowledge, do not gain experience with the do's and dont's of transport tenders, and lack the software to make complex scenario analyses. In addition, a transport tender is time-consuming, so we can provide the extra hands to relieve the organisation.
We provide detailed decision information for our clients. In fact, we calculate to the nearest euro what the choices made will cost. We use our software to calculate a representative shipment profile (mostly annual shipments) against the quotes received. This makes it clear for each shipment exactly what it costs with each carrier. We then consult with our customer to analyse scenarios based on available capacity, sustainability, service and the use of one or more carriers per region, country or total package. The outcome is an analysis on which informed choices can be made.
Feedback is crucial for carriers to gain insight into where their bids can be strengthened. The benefit is that it leads to better bids in any subsequent tender round. We often provide, in consultation with our customer, a shipment-level report. This allows the carrier to see exactly where the strengths and weaknesses in their tender lie. During a transport tender, there are always winners and losers. There is nothing more annoying for a losing carrier to be told, 'Sorry, but we are moving on to other parties', without knowing why exactly. So by providing good, neat and accurate feedback during a tender, alongside better offers, you ensure that even the doors remain ajar for rejected carriers. This is useful because you might need them again in the future.
This is possible, we can help from writing tender documentation to supporting in the decision process. During the project, we even take all communication with the carriers out of your hands. Ultimately, our clients themselves conclude the contracts or agreements with the carriers to be awarded. We also offer support on specific parts of a tender, for example making complex scenario analyses using our software. Our services are fully tailored to our customers' requirements.
Pitfalls abound, but probably the two biggest are entrusting communication with a carrier to the tender software and sticking to a fixed template for bids. The two often go hand in hand and can lead to significantly increased transport costs for companies. Tendering is personal; carriers want to know who, what and why they should participate, as a tender is also time-consuming for them. Often, through software, carriers only receive a notification that they may participate in a tender. As a result, sometimes the best companies for your profile decide to drop out, a missed opportunity. Moreover, they then have to load their rates via software. Why the latter is absolutely problematic is explained in this blog (https://transinnovate.com/valkuilen-bij-transport-inkopen-the-killing-rate-template/). So it is essential to adopt a personalised approach and use software that can load carriers' quotes, where it is crucial that they can continue to use their own format.
It starts with a detailed description of the desired service in the RFQ (Request for Quotation) document. Consider aspects such as trailer type, company type, opening hours, transit times, service levels and so on. You can then prepare a compliance document asking carriers to indicate how they deal with these aspects and whether they can meet them. The questions in the compliance document can possibly be "ranked" so that a score is generated for each carrier. Kick-out criteria can also be added, making it clear that if carriers cannot meet these aspects, it will never lead to cooperation. Ultimately, you can put the compliance scores alongside the scenario (cost) analyses and then make both cost and service-based decisions in the decision-making process.
