How can I manage provider performance? [Q&A #18]

While we know that price is relevant, our data suggest that price alone is not the key metric.

Who is the best?

A chat with Alex van Kampen, Head of Product at Cargobase, discussing product related topics on the Cargobase platform.

How Can I Manage Provider Performance?

Often times the first metric that companies ask for is to see which of their providers is the cheapest. While we know that price is relevant and certain providers can be more competitive than others, our data suggest that that price alone is not the key metric. For one, especially with expedited shipments pricing or relative position of providers can vary greatly. The cheap company today can be the most expensive one tomorrow and vice versa.

Therefore, the Cargobase platform offers different ways to view provider performance. The most straightforward is the ‘on-time-performance'. This is an overview, per provider of who is on early, on-time, or late and by how much on average. This metric is available in default dashboards, but can also be extracted from raw data.

Another default metric is the quoting performance. By quoting performance, we mean the number of times a provider is invited, how often they respond, and how often they win. There is no point in negotiating payment terms with a company that will never win your business for instance. But this data is also used to see if there are white spots in your global coverage, either for specific freight modes or lanes.

Can We Also Submit Our Own Reviews?

After a shipment is delivered, a provider can be rated on three specific topics and general performance. The specific topics are pricing, on-time performance, and communication. These ratings are subjective and are on a 1-5 scale but provide great trend data over time. These reviews are internal to the shipper and can be used in quarterly reviews with the provider.

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