The move from organic to planned is a baseline strategy in creating a resilient supply chain. A boat gets stuck in some distant channel in March, and holiday toys don’t get delivered in December. A storm – or a pandemic – shuts down a warehouse in Boise, and someone in Delaware doesn’t get a life-saving medicine on time. Shippers won’t be able to stop external forces like these from disrupting their chain, but they can make decisions that help them bounce back faster.
One of the critical areas to consider is your carrier relationships. You have a few options. You could create a dedicated fleet, but then you’d have outsized costs. For a department that is traditionally engineered to minimize costs (see Just In Time delivery), this seems like a stretch. You’d also have to take ownership of managing trucks and drivers, which isn’t traditionally within a brand’s core expertise.
Your other option is to work with a traditional broker who becomes the middleman, has access to a fragmented market, and takes on the risk. But they’re typically concerned with cost above all. They tend to procure the lowest cost carriers as long as they meet insurance and safety requirements.
What happens when you’re laser-focused on cost-cutting mission-critical aspects of your business? Things fall apart. You want to not only keep things together, but build systems strong enough to bounce back faster.
Your best option, then, is to find the right broker with the right carrier relationships.
The right broker can simulate a dedicated delivery fleet while still leaving you with “one throat to choke” when things go pear-shaped (my apologies, account teams everywhere). Here are some signs that you’ve found a good home for your carrier needs.
They implement a carrier-led approach
This might seem counterintuitive. You want a broker to put your needs first. But therein lies the rub. When brokers put time and resources behind building consistent carrier relationships, they are putting shippers’ needs first. Because without the connection to the best carriers, shippers can’t perform at optimum capacity and be better prepared to weather those disruptive external forces. They also can’t save on shipping costs.
The best brokers will aim to minimize shipping costs for customers by finding optimal carrier partners. By incorporating trucking companies’ preferences into the broker’s marketplace, the broker can find those carriers that are high quality, reliable, and cost-effective.
No two carriers are alike, and brokers shouldn’t treat them that way. Understanding carrier preferences allows Transfix to make critical moves like offering consistent lanes, so the carrier doesn’t have to respond to unpredictability and increase their costs (which, in turn, gets passed on to shippers). Further, we are committed to provide increased freight volume and easy access to loads. Together, these strategies mean each container moves quickly from terminal to terminal and reduces overhead — precisely what a resilient supply chain needs to stay in business and on track.
They invest in technology to enable relationships
People think technology and service are at odds — one is robotic, and the other is soft and human. This is false. Software plus service makes all the difference. By embedding technology into the supply chain and understanding the vagaries of each shipper and carrier, brokers can build an entire service architecture over their tech.
Remember: shipping was built on relationships. That is still accurate today. Connections between shippers and carriers, between carriers and workers, and between the dispatchers all drive success. Shippers should use the tech and tools at their disposal to make sure those relationships don’t dry up and fail over time.
Modern transportation management systems (TMS) can rank and match carriers with appropriate loads using a multitude of information supplied by historical data and more. This automation process can drive repeated bookings and strong shipper and carrier relationships.
Dedicated technology can also help shippers make smarter – aka planned decisions – about their supply chain. It can also help shippers get ahead of problems, rather than being surprised by them like receiving notifications before the warehouse is delayed or if traffic pushes a shipment off schedule.
In a previous article, we recapped the eight metrics every TMS should track. Without monitoring the carrier metrics that matter – including high load acceptance, low cancellation rate, and high on-time performance and delivery – you have no chance of uncovering the actionable insights that streamline decision-making and strip away potential resiliency cracks.
In this market, it’s about having products on the shelf. Consistent carrier relationships help you accomplish that. If done right, shippers get better carriers and more consistent service at a better price — three necessary buffers in an unpredictable world.