Are you Paying Too Much for Your Shipments? Benchmark Your Carrier Activities to Find Out

[Jean Carl]

Competition for static transportation resources by shippers has
prompted many carriers to initiate across-the-board rate increases.
At the same time, rising fuel charges continue to escalate carrier
surcharges. And with limited transportation resources available to
support increasing freight demands, shippers like you may had to
occasionally contract more expensive drivers to get goods transported
on time. As a result, your freight costs may be higher than planned
and represent a more significant percentage of delivered price.

To remain competitive and understand actual transportation costs,
chemical shippers must gather market intelligence on their own
networks to get an accurate picture of how they are buying in the
market. By reviewing shipments history, carrier agreements and freight
invoices, a benchmark study can reveal what was actually paid to a
carrier on a per shipment basis. And by comparing this data to market
trend costs for shipping goods in specific traffic lands and
geographic regions, a benchmark can determine if you paid best in
class rates or too much with specific carriers.

Through this analysis, the benchmark study can provide insights on the
competitiveness of your company’s freight rates. It can also serve as
a basis to negotiate significant improvements to your own carrier
agreements and standardize corporate rates associated with accessorial
charges such as fuel surcharges and unloading costs among your
carriers.

However, compiling and analyzing this data requires a significant
investment of time and resources as well as access to competitive
carrier freight rate and lane imbalance information to which most
shippers don’t have access. That’s where a transportation consultant,
such as ChemLogix, becomes invaluable. Possessing market
intelligence, an established carrier network as well as a dedicated
team focused on this work, a third party logistics provider (3PL) -
familiar with your industry - can conduct a thorough benchmark study
faster and more cost effective than many in-house logistic departments
who don’t have the available resources or experience for this
endeavor.

Using benchmark results, 3PLs can take you to the next step in
negotiating rates with carriers for service in specific lanes and
regions and identifying new sources to replace those that have priced
themselves too high for your business. To find out more about how
benchmarking can provide you with the tools and analysis to mitigate
rising carrier costs, contact us at infor...@chemlogix.com or visit
our web site at: http://www.chemlogix.com/solutions/freight-procurement.