Executive Briefings

How to Optimize Collaborative Shipping Procurement

With more than 100,000 freight carriers operating in North America, sophisticated shippers long ago realized the only way to successfully and efficiently procure transportation was by hosting regular bidding events.

How to Optimize Collaborative Shipping Procurement

A natural extension of that is to partner with other shippers who have similar needs and engage in collaborative shipping procurement, where carriers can save time and bid for multiple contracts at the same time while identifying synergies that could reduce their costs and the costs of one or more shippers.

Launching a successful collaborative shipping event requires a much broader lens than the “aggregate more spend and they will come” philosophy. That’s because pure economies of scale models are only predictable in commodities markets, but the transportation industry is based on relationships, and handshake deals still have meaning.

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A natural extension of that is to partner with other shippers who have similar needs and engage in collaborative shipping procurement, where carriers can save time and bid for multiple contracts at the same time while identifying synergies that could reduce their costs and the costs of one or more shippers.

Launching a successful collaborative shipping event requires a much broader lens than the “aggregate more spend and they will come” philosophy. That’s because pure economies of scale models are only predictable in commodities markets, but the transportation industry is based on relationships, and handshake deals still have meaning.

Read Full Article

How to Optimize Collaborative Shipping Procurement