A chapter in our freight procurement best practices series, find real partners to work with to optimize your logistics
Without having the right group of suppliers you will not be able to get the best results from your spot-buy exercise.
Ask yourself these basic questions:
Your spot-buy freight partners are most often your regular logistics service providers. These can be your freight forwarders, local carriers, or specialized providers. Even if you only work with them for regular contracted freight, they are always keen to quote on spot-buy freight. However, even if you are in contact with a regular partner the contact persons can be very different, therefore it is always good to ask your providers to ensure you have the right contacts on file.
Something that we get asked regularly is: “What is the optimum number of providers to invite for a spot-buy quote?” The answer varies, depending on several factors. Firstly, how many quotations do you want/need to receive? Many corporates have the basic 3-quotes rule as required in their standard compliance process. Secondly, how are you organizing your spot-buy quoting? Is it a manual or automated process? Data from our Spot-Buy Freight Quoting 2019 report shows that the ideal number of providers to invite is between 4-9, which can be tedious if you are managing your spot-buy freight quoting manually. Often many face limitations on the number of providers they can invite, realizing the efforts to request and compare quotes manually might outweigh the results from the exercise.
This question is best answered by your logistics partners, but it does help to verify with the data you capture. Unfortunately, we still see a lot of logistics providers that say “yes” to everything, regardless of lane, freight mode or specialty. Your spot-buy freight data will tell you the truth if you capture and review this well. We cannot stress enough to only invite logistics providers for their true capabilities based on freight mode and geographical strengths. You won’t go to a butcher for a surgery, neither should you ask a road freight provider for an air freight quote.
This saves time and improves the quality of the quote and the actual shipment. If your spot-buy freight quoting process is automated you will be able to analyze which provider is truly good at what freight mode and in which area.