As more shippers move away from annual contracts in favor of more frequent bid processes, knowing exactly when and how to build RFPs throughout the year can be a challenge. Most shippers are used to executing one bid process per year, and learning how to take advantage of shorter contracts requires practice and a good partner.
No matter how long the contract term is, building the most effective RFPs possible requires self-awareness, attention to detail, industry insights, and a willingness to adopt new technologies. Shippers lacking in any of these areas are more likely to end up with higher rates and less reliable capacity.
According to Mark McEntire, SVP of Operations at Emerge, some common RFP mistakes that could impede a shipper’s ability to drive the most desirable outcome include:
- Lack of lane level detail.
- Including lanes that a shipper has no intention of removing from the incumbent to benchmark the pricing.
- Including seasonal, promotional, and surge volume in a yearly bid.
- Pulling from the same carrier pool as other large shippers.
- Conducting one annual event and not doing mini bids throughout the year to strengthen the routing guide.
- Not giving carriers post-bid feedback.
- Reluctance to adopt technology to perform RFPs.
Many of these commonplace issues can be addressed by finding the right third-party partner. For example, adopting the Emerge technology to manage the RFP process allows shippers to issue mini bids for seasonal, promotional, and surge volume several times per year.
“Technology and data can inform a shipper of key elements inside freight management to drive an improved outcome. Informed decisions on when to bid, what to bid, and how long to extend rates are all elements that Emerge can deliver through our technology,” McEntire said. “The Emerge Marketplace has become a destination for carriers and shippers to find new sources of supply and demand.”
Leveraging the Emerge Freight Procurement Platform also allows shippers to open up their carrier pool, giving them access to significantly more capacity.
Most shippers only invite their incumbents — and potentially a few new carriers who often lack familiarity with the company’s freight — to bid. The Emerge platform grants shippers access to 35,000 marketplace carriers that can become a new source of capacity. This is especially useful in today’s strained market.
“In 2022, the topic of freight is in the boardroom like never before. Shippers are being forced to change how they think about procurement,” McEntire said. “The reluctance to adopt technology is waning.No longer can spreadsheets, email, or technology that requires engineers to provide the nimbleness and user experience required. Emerge is providing transparent, agnostic, and informed outcomes.”