Picking good carriers and having backups is essential
Picking good carriers and having backups is essential
Fri 01/10/2021 - 19:54

Selecting Carriers in an Uncertain Environment

Nearly everyone is aware of how difficult it is to get product to a Big-Box retailer right now. Of course, there are external factors out of our control such as labor shortages, capacity crunches, port congestion, inflation, and stringent requirements for shipping into each retailer.

When you’re faced with such daunting challenges, how do you go about selecting the right carrier to navigate through these various factors to get your product on shelves On-Time In-Full (OTIF)?

Why carriers reject loads

Unfortunately, there are many reasons why a carrier will reject a load. The image below from a recent FreightWaves article, Carriers head west for a modern-day gold rush — of freight, shows just how high tender rejection is right now.

The article states, “Loads traveling more than 800 miles (long haul) to the West Coast have been rejected at nearly half the rate of any other region in the continental U.S. over the past two months (long haul is used to eliminate loads that move intra-region).”

FreightWaves shows the Tender Reject currently occuring

Source: Chart of the Week: Longhaul Inbound Tender Rejection Index – Regional – USA, FreightWaves

Carriers are often very precise and specialize in their equipment and skills with specific retailers. They might not have the right equipment available, be available for certain lanes, or know the ins and outs of certain retailers.

Another factor that can turn away carriers is longer live unloaded times as it can take 8-12 hours for an unload. This holds up the driver as well as the truck and limits them from other loads. Even on a drop program, there can be a long wait time for getting equipment back, sometimes sitting for a week or more. Most carriers want equipment to turn loads at least three times a week.

This is causing carriers to simply refuse to deliver into certain retailers. On top of carriers specializing in their services aligning with specific retailers, they’re often amplified by already established relationships and drop agreements.

Therefore, it’s important to make sure that your carriers align with the retailer you’re trying to ship into. Be surgical when finding carriers that fit a specific need or that already have a working relationship with a specific retailer. However, it’s also essential to prepare for disruptions.

Having backup carrier plans

While it’s important to be selective when choosing a carrier, it’s also extremely important to have backup plans with multiple carriers for a single lane lined up. When conducting a Request For Proposal (RFP) for a carrier, preface with one that fits specific needs, but have a variety of carriers lined up that don’t quite match your number one choice.

They may be down the list due to cost or availability, but if something were to happen, you’ll have a wide network to choose from. Transportation never stops and getting stuck with loads you can’t move because you don’t have multiple backup plans can lead to disaster. Consider an experienced freight broker that has available capacity and supports all modes.

Having a backup carrier is essential in today's volatile market

How an RCS (Retail Consolidation Services) program can help

A good RCS program has carrier relationships already established, so you don’t have to worry about doing it yourself. They will get your product to the retailers you wish while choosing the proper carriers as needed.

An RCS program is also more efficient than the current LTL market, especially considering the current carrier spot rates. With a good RCS program, you won’t have to worry as much about trucks being held up for live unloads or drops. The program should also utilize specialized relationships and have plans to mitigate fines or delays.

Consistently meeting retailers’ OTIF guidelines is easier when you don’t have to worry about the carrier relationships yourself.

GEODIS can fulfil your carrier needs

GEODIS already has an extensive network of specialized carriers as well as another 20,000+ carriers in our network. If there is a last-minute load or a live unload, we’re always prepared and will never be stuck with product that can’t be shipped.

We have handpicked relationships with each carrier that fit our specific retailers’ needs. Learn more about our RCS program here and how we can fulfill your carrier needs. We also have an experienced brokerage team for our GEODIS Capacity Solutions (GCS) program for that added security of securing capacity.

 

Author: Evan Glick

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