Businesses that utilize freight are often making tactical, short term, economical decisions in their transportation department. Making short term decisions can be good temporarily but may be detrimental to the department they are supposed to serve. True growth can only be achieved by making strategic, long term decisions with good business partners. All good decisions start with great questions. Your 3PL partners should be asking you the right questions about your transportation goals and needs from the very beginning of the relationship.
The Top 7 Questions You Should Be Asking About Your Freight:
What is your main KPI (Key Performance Indicator) when it comes to transporting your goods?
What is your damage % and how is it currently handled ?
What is your general rate-increase mitigation strategy?
How has the deduction in fuel cost affected your spend year over year?
Have you considered integrating your ERP (Enterprise Resource Planning) system into a TMS (Transportation Management System)?
What is your freight cost as a % of sales normally?
What have your latest consolidation opportunities looked like as far as mode optimization?
All good decisions start with great questions.
Lets’ take a look at each question and why it should be important for your business transportation department:
1. What is your main KPI (Key Performance Indicator) when it comes to transporting your goods?
KPI’s help all sides of your transportation program. Deciding which indicators are most important for your particular type of freight puts your team and your 3PL on the same page so there is no questioning of the program’s success. From delivery times to damage %, KPI’s will produce real numbers that need to be met. BlueGrace is dedicated to meeting all agreed upon KPI’s.
2. What is your damage % and how is it currently handled ?
Because we track damage % as a KPI, we are up to date on what that number is at all times. How the damage is handled is another issue. BlueGrace is able to handle those claims and report on them as well, so it’s important ti ensure that is happening for your team.
3. What is your general rate-increase mitigation strategy?
Rates fluctuate and move from carrier to carrier. Staying on top of the increases can make or break the the costs of your transportation department. BlueGrace is known to have one of the best pricing teams in the logistics industry, so we are always looking for these types of increases. Our customers are notified as quickly as they are able to forecast and prepare for pricing changes.
4. How has the deduction in fuel costs affected your spend year over year?
Fuel costs can dramatically effect your transportation costs. You should be able to see variances year over year and changes in your overall costs. BlueGrace monitors fuel costs and provides reporting on any effects to your program.
5. Have you considered integrating your ERP system into a TMS (Transportation Management System)?
How many steps does your transportation department currently take to quote and schedule your shipments? If it’s becoming increasingly more difficult to manage the day to day in your transportation department, in might be time to integrate your systems. At BlueGrace we specialize in the integration of ERP systems through our BlueShip 3.0 TMS. By streamlining these manual processes, time is saved and visibility is greatly increased.
6. What is your freight cost as a % of sales normally?
This percentage should be determined and maintained through your partnership with your 3PL and fluctuations in % need to be monitored. At BlueGrace, we work with you to decrease the % of freight costs with automation, our carrier relationships, and enhanced support.
7. What do your consolidation opportunities look like as far as mode optimization?
Consolidation opportunities are everywhere if you have the data to determine them. The most commonly overlooked consolidation opportunity is intermodal. Rail has become an increasingly attractive mode to full truckload shippers with the only difference being longer transit times to the shipper and consignee. Do you have volume shipments with an LTL carrier that could be shipped partial truckload? BlueGrace has experience in data analysis and we can help when it is time to optimize.
These 7 questions are the first big step to optimizing your transportation department. If you need help with your current freight, or are not seeing the results from your current 3PL, feel free to contact BlueGrace and we will be glad to discuss all 7 questions and help you succeed!