It’s that time of the year, folks. It’s bidding season! The shipping industry is always at the mercy of politics, trade wars, global health, the world economy, changes in tariffs, and company acquisitions. This year is no different. The surge in online ordering and increase in canceled sailings could raise contract prices to record highs. Don’t commit to a high shipping bid without reading what we have to say first.
Shipping Delays Causing Backups
Coronavirus and the ensuing restrictions have disrupted normal shipping patterns. Closed ports, extra precautions, and limitations on traveling through some affected areas have put shipping carriers further behind. In the meantime, more people are at home and ordering online more often. Sadly, all of these changes to daily patterns have put ocean carriers far behind.
Meanwhile, ocean shipping isn’t the only transport method that has seen an uptick in delays. Domestic trucking has struggled to keep up as well. Over the past few months, trucking companies have seen a boost in volumes, but there are still shortages. This shortfall isn’t likely to improve with the peak season at our doorstep.
Now that we’re heading into the holiday season, increases in delays are inevitable. If you don’t plan carefully, you’re likely to lock-in prices that will cut heavily into your 2021 profits.
Higher Fuel Costs Having Negative Effects
Another obstacle to getting an optimal bid is the current fuel costs. The IMO2020 regulation aimed at cleaner air has had another consequence: increasing fuel and operating costs for shipping carriers, which they pass to us (the customers).
Freight Prices on the Rise
Air and ocean freight prices have steadily been on the rise as well. The rising costs have many contributing factors, but the continued delays and rising demands for ocean freight shipping have caused air shipping to experience an unusual number of transport requests.
Bids That Make Sense
Understanding the shipping world’s woes gives you a better idea of what to expect when putting a request for proposal (RFP) out. Bids can have dramatic changes from year to year, depending on what’s happening in the world. If your head is spinning from trying to figure out who has offered the best terms, rates, and delivery times, then you may need help.
Modes of Delivery
Do you ship nationally or internationally? Would over-the-road or intermodal transport serve you better? You may have been presented with a really attractive rate for shipping your freight across the country. Still, if your customer expects speedy delivery, then intermodal might be out of the question. Some of your providers may only specialize in certain modes. You’re probably struggling to compare what logistics companies are offering to find the best deal. It can be hard to do a side by side comparison since it’s not always apples to apples.
How Long Will It Take to Get There
Another part of pricing involves the length of time to deliver. You’ll need to stay up to speed to know what an acceptable delivery window is. Do the delivery windows being offered match your needs? You may be able to negotiate some of the terms, but it takes precious time away from other aspects of your business to negotiate with, say, the top 3 bidders.
You’ll also want to know if they provide a platform where you can look up delivery times and costs. A rate sheet at the beginning of your contract won’t stay current all year long. Working with logistics management companies that use cutting edge technology is likely to save you time and money in the long run.
Are you speaking with providers that will give you up to the moment tracking on all of your shipments? You may not always get the data you need to let your customers know when to expect their products. Your shipment may even get lost, and you may not know right away. You’ll want to ask potential providers if they give you an up-to-date dashboard or other technology to stay on top of what’s going on with your shipments.
The bidding process can be difficult and time-consuming. There may also be questions you don’t know to ask.
How FMI Can Simply Your Bidding Process
Freight Management Inc. can take the stress out of bidding for you. We work with over 15,000 carriers. If you need a full truckload, less than a full truckload, or an intermodal shipping option, we can arrange it. When it comes to drayage, we have a rate management system that will blow anything you’ve used before out of the water. Within it, you can quickly get ramp and port pricing as well as carrier comparisons.
Our advanced Draydex management system will make your job a breeze. There’s even a Book Now pricing system for those times when you want to lock in a price and capacity instantly. We even help you track your shipments once they’ve left right up until they reach their destination. Every step of the way, we make your job easier and more efficient.