Office Supplies ≠ Freight
Large consulting firms and purchasing groups offer freight rate negotiation services, but they have the same process for negotiating pens and pencils as they do with complex freight. It’s not the same. Successful rate negotiation requires detailed modeling, extensive benchmarking, and in-depth knowledge of the transportation mode and supply chain market in order to reduce freight costs.
At Trans-solutions, we take the time required to do a fact-based, numbers-driven analysis of your freight profile in order to deliver precise recommendations you can trust. It starts with an accurate baseline built from a representative sample of your shipments. Once the baseline is established, we re-rate the freight with the negotiated carrier pricing and ancillary charges so we can see exactly where, when, and why prices improve and don’t improve.
From this analysis you will know, quantifiably, how much you are gaining or losing and where to focus attention during negotiations. It’s an exacting approach that takes more time and effort. But having a detailed understanding of all the pricing elements that make up your freight rates significantly strengthens your negotiating position and your ability to optimize freight costs.
Freight Rate Negotiation Services
You’d like to reduce your rates. But here’s the problem. While you know your rates, you’re dealing with large carriers who see everyone’s rates and know the price they can command for the freight. The way to address this is to see what the carriers see. We can help. Trans-solutions maintains a detailed benchmark database of carrier rates across all modes of transportation. We know what the market will bear and can leverage this knowledge to cut your current rates 10%-20%.
Want to negotiate smarter? Download our free white paper:
“Rate Negotiation: Five Things Carriers Don’t Want You to Know.”
Our freight negotiation services include:
- General carrier contract negotiation strategy and the factors that can improve your rates
- Cold chain transportation and negotiation with refrigerated carriers.
Common Misconceptions in Freight Rate Negotiation
- Freight rate reductions are not linear.
An additional 10% discount doesn’t necessarily mean your freight bill is reduced by 10%. Accessorial charges, minimum charge thresholds, and other factors may offset the discount.
- A better rate isn’t necessarily a good rate.
You can’t know if you’re getting competitive freight rates unless you know what other shippers are paying. Because Trans-solutions does carrier rate negotiation for many companies, we maintain an extensive record of these rates. If your rates do not compare favorably, we use this knowledge as leverage on your behalf.
- To carriers, all freight is not the same.
TL carriers want freight to where they have an established backhaul lane and NVOCCs want freight to lanes where they have purchased capacity. Knowing what freight the carriers want can help you reduce freight costs by an additional 10%-20%. Sales incentives change regularly and Trans-solutions makes it our business to understand the type of freight carriers seek, and how they are compensated.
- Bundling all your freight with one carrier doesn’t ensure the best pricing.
This is a common misconception with large management consulting practices that negotiate freight. Because they think negotiating freight is like negotiating pens and pencils, they miss the nuances of the commodity and leave money on the table.