8 Steps To Better Freight Optimization
We often talk about reducing costs, boosting business and uncovering new opportunities but seldom do we consider how end-to-end freight management can be optimised.
Freight optimisation goes way beyond merely determining the fastest route for a shipment. It involves multiple aspects right from sourcing raw materials to delivering the finished goods to the customer and much more.
Modern-day shippers can quickly optimise their supply chain operations by using various freight management solutions to their advantage. Here are some steps that you can follow to optimise your freight operations and management:
1. What are the available modes, what is the rate per shipment?
The first step towards improving freight management is reviewing all the possible modes of transport for a shipment. Post that, you can consider how much the shipment will cost you if you select a specific mode.
You can even consider each mode of transport’s pros and cons and accordingly make an informed decision. The key is that when we speak of optimisation, the idea is to complete the task in the most efficient way possible. Using international freight index tool to benchmark your freight rates can help you further enhance your negotiations.
While you optimise your processes, you need to ensure that nothing comes at the cost of compromised customer service or experience.
2. Diversify your carrier and vendor network
An efficient way to secure competitive rates is to expand your carrier and vendor network—more the competition, more the negotiations, and better the rates.
It’s crucial to note here that increasing the vendor and carrier pool may not be practical in a traditional negotiation set-up. However, by adopting a freight management system, you can automate negotiations and potentially engage with as many vendors as you like.
Systems like GoComet’s RFQ management module assure you the best possible rates via its innovative compounded negotiation system. The system is designed to conduct multiple automated negotiations with dynamic deadlines. It nudges your vendors to compete with each other to offer you the best rates.
3. Assess risks and opportunities by exploring multiple routes
Considering multiple routing options and analysing the chosen route is a must. It makes route optimisation possible and ensures cost-effectiveness.
Many times it offers a peek into new opportunities and markets.
4. Leverage automation technology
You can leverage automation-based solutions by adopting a freight management software. The systems use artificial intelligence and machine learning algorithms to help you better plan your shipments, automate RFQ management, shipment tracking, invoice reconciliation and more.
With automation to the rescue, you can free your team from repetitive and time-consuming tasks, allowing them to focus on more important work.
5. Simpler the system, better the result
Adopting a freight management solution has numerous benefits. However, it’s crucial to note that you don’t need a fancy system that requires you to rush to your service provider’s support team every two days.
It’s advisable to opt for an easy to use and integrate with the existing workflows system. The new-age cloud-based solutions have low implementation costs and can be updated and customised effortlessly to suit your needs.
6. Don’t go overboard with customisable systems
When you choose a freight management system, only modify it where it’s necessary. Even better, if you have clarity over the must-have features for your organisation. Unnecessary features and customisations to the platform will not only add to the cost of the system but require complicated upgrades.
If you’re stuck in the buy vs build dilemma, remember that state-of-the-art systems have a broad scope of functionality. These off the shelf systems can effectively meet or even exceed your essential requirements. So, in most of the cases, a few modifications suffice.
7. Do your bit on the sustainability front
Give your customers incentives to wait for their deliveries. In today’s day and age where everything has to be fast-paced, it’s natural for your customers to expect speedy deliveries. However, these deliveries come at the cost of the environment.
You can consider raising awareness and encouraging sustainable, relatively environment-friendly practices. This is one instance where you can prioritise the greater interest of everyone over boosting the bottom line.
8. Measure performance and focus on long term success
Too many things can get short-lived success. But the real improvement is when the operational efficiency and agility you build lasts in the long term.
Make sure to have KPIs for every vital task and track the progress regularly. Long-term success undoubtedly requires sustained dedication and efforts.
Optimise Freight Management for today and tomorrow with the right systems
Adopting the right systems augments freight optimisation and makes it possible to drive time and cost savings. As a shipper, you have more than enough tools at your disposal today to take control of your supply chain and proactively drive profitability by leveraging the right systems at the right time.
For information on how GoComet’s Freight Management System can help you build a cost-effective supply chain and ensure freight optimisation, reach us here.