Set KPI's for logistics providers [Chapter 9]

A chapter in our freight procurement best practices series, set the right KPI's for your logistic providers.

Set KPI's for logistics providers

Shippers often rely on performance data from their logistics providers. This is the case for performance data for both parties. Yes, this still happens: logistics providers provide their own performance data.

That is a bit like a student marking their own exam. This sad reality is often the result of just not having any reliable performance repository or system in place, especially for spot-buy freight.

Shippers often do not know how much they spend or with whom, let alone what the actual performance is of their logistics providers. Cargobase has worked closely with shippers and logistics service providers to help both sides get access to better data more easily.

Shippers are now able to check the the following data of their logistics providers:

  • Quoting Performance: Quote, Not-Quoted, Won, Lost, Declined
  • Quoting Response Time: How fast doest it take for a provider to quote.
  • Delivery Performance: Quoted Delivery Time vs Actual Delivery Time
  • Cost Performance: Quoted Rate versus Final Invoice Amount

This kind of information is really only available if you capture your process in a structured platform. It would be an impossible task fo them to gather this data from emails or spreadsheets. Shippers are now able to see if they are invited the right providers and if providers are accurate with their costing and deliveries.

This performance reporting struggle is not only limited to shippers: Logistics providers often also have a hard time compiling the right data. Especially when they need align datasources from multiple locations within their own organization. That makes quoting for them guess work. Therefore, once you start recording these metrics in a central system, the logistics providers themselves also greatly benefit.

The solution of choice should provide the logistics company with at least the following information:

  • Quoting Performance: Quote, Not-Quoted, Won, Lost, Declined – per team, freight mode, lane or even the individual employee level.
  • Quoting Outcome: Lost quotation reasons, number of rejections.
  • Shipment Won: Shipment numbers and size of the business, across the world.
  • Delivery Performance: Quoted Delivery Time vs Actual Delivery Time
  • Costing Performance: Quoted Rate versus Final Invoice Amount
  • Invoice Status: Invoice status, duration and timing.

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