The Preferred Shipper Program Survey identified key factors in how carriers evaluate shippers and provides insight to help shipper organizations better understand the best practices for becoming a preferred shipper for carriers.
“Shippers are looking for ways to improve their transportation operations, and a significant way to do so is by aligning efforts with their carrier partners to improve efficiency and overall benefits to all parties,” said Ben Cubitt, senior vice president, consulting and engineering for Transplace. “The survey responses consistently ranked economics and driver productivity as the keys to ‘preferred shipper’ status.”
Observations from the survey include:
• Shipper Ratings: Economics remain the most important factor in how carriers evaluate and rate shippers – with nearly all respondents indicating market competitive rates and fair fuel surcharges as “critical” or “important” factors. Payment terms and average length of time until payment was also a key area for many carriers with 63 percent ranking it as a “major factor” and 36 percent considering it “important but not critical.” Of the carriers surveyed, 30-day payment terms are considered acceptable by the majority of carriers and paying in less than 30 days would really differentiate a shipper. Volume potential and positive credit rating were also consistently rated as a major factor.
• Driver Productivity: Productivity of the driver is continuing to be a focus for carriers and one of the most critical factors in shipper freight profiles or practices. Of those surveyed, 97 percent considered dwell time as an “important” or “critical” factor in determining the preference status of a shipper. In-transit delays was second with 65 percent considering it a “major” factor and 32 percent considering it “important.” The ability to use drop trailers, shipper load count and type of freight were also key factors.
• Driver-Friendly Facilities: Carriers ranked driver-friendly practices highest based on those that enhanced driver productivity, such as on-site parking and available bathrooms for drivers. Regular updates on loading and unloading status and a guard shack for drivers to receive instructions were also high on the list. Break rooms for drivers rounded out the top five.
• Relationship: The scope of the relationship and the level of partnership can also affect the preference status of a shipper. The effort of a shipper to understand a carrier’s costs with relationship to equipment and recruiting drivers and willingness to discuss its issues were ranked as the two largest factors in impacting the shipper/carrier relationship. In addition, treating drivers with respect and as a valuable network asset can impact the way the shipper is viewed by an entire carrier organization.
Carriers, just like shippers, are looking for ways to improve efficiency and streamline their operations. This includes being mindful of the companies they work with and keeping detailed metrics for their shipper partners. Of the carriers surveyed, 47 percent said they have a shipper scorecard detailing companies.
“Network efficiency and driver productivity are becoming the foremost concern and focus for many carriers,” Cubitt said. “And they will reward efficient shippers that help keep their trucks and drivers with capacity. However, it’s not just about efficient deliveries. Carriers want shippers to be partners at every level and work together to drive productivity and efficiency.”