Things to Consider When Selecting the Right Freight Forwarder
Finding the right provider in today’s world of complex supply chains is far more difficult than it used to be. Simple metrics such as on-time performance, billing accuracy, claims ratios and competitive pricing are now table stakes in today’s world of logistics. We’ve polled some of our valued clients and industry experts over the past year for some sound advice when searching for that right partner. Today’s focus will be specific to supply chain challenges that require a “High Touch” mission critical mindset. Is your forwarder helping you reduce risk, facilitate growth and enhancing your brand?
Proven Core Competencies
Given all the M&A activity in the market today, is bigger better? The financial markets may say so, but the experts we polled would lean toward core competencies as a better gauge in terms of capabilities vs size. Being competitive is a must, but having an expertise and evidence of quality service in specific service offerings is critical. Does the provider have a track record of success in your vertical or have a history solving similar logistics challenges?Most will answer yes, but can they prove it with a referenceable client base? What is the average tenure of their existing clients in your space or services required? What measurable do they use to determine if they are providing a superior client experience?
Collaborative Client Support Structure
Understanding your unique business challenges and having the right partner to make your life easier, is paramount. Even if the provider has experience in your industry, they must understand that once size doesn’t fit all. What we’ve found is we may be supporting clients that compete in the exact same industries, but their supply chain dynamics require different solutions. Those challenges have a wide range of variance, from packaging challenges to where raw materials are sourced. IT solutions must be adaptable as well. Simple dashboard visibility may be a must for one client and much more complex for the other. What type of client service model will be utilized? The quality of your operations support team is critical to sustain an ongoing, collaborative support environment. Challenge the potential provider on their support structure and the culture within their organization. Bottom line, IT and human resources should make your life easier.
Change is difficult. Regret or demotions are not on the top of anyone’s transition list. IT integrations, routing guide changes, freight payment audit processes and many other changes all play a part. Ask the potential forwarder what processes they have in place to best mitigate a smooth transition. When reaching out to the references, make that a point of conversation. A smooth transition is not easy and should be well thought of and executed between both parties transition teams.
Having a strong, battle tested network heavy on visibility provides that reliability and consistency everyone desires. How flexible are their network options? Does it help improve cost efficiencies? Forwarders must maintain a network with the capability for non-static supply chain changes, which is essential in today’s world. Does the network provide real-time visibility and accuracy with status updates? How does their network limit touch points for high value, highly susceptible to damage product types?
Managing the Exceptions
How often has a relationship gone sour over a significant service interruption or high value claim? Reality is, nobody is perfect and anyone who says their execution is flawless should immediately be blacklisted. Claims, damages or a lost shipment, should be minimal but will eventually happen. Does the forwarder make it a difficult process to file or actually assist you in how to quickly get paid? How many Service Logistics Agreement penalties have been paid out due to service failures? SLA failures bring a new dynamic to qualifying carriers. A reduction in failures will reduce your overall budget and maintain high satisfaction with key stakeholders. How does the forwarder respond when those failures occur?
These are just a few ideas to think about when thinking of making a change. Feel free to comment on other considerations.