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In a world where data and transparency are driving groundbreaking results, freight procurement is one vertical, in particular, that’s still operating in the dark. And while categories such as retail, healthcare, insurance, and many others are raving about the number of insights they’re receiving -- and the “glass box” they’re operating in regarding data -- shippers and carriers are still blindly looking for ways to operate with minimal insights to work with. Needless to say, they’ve gotten tired of this state of affairs.

As the technology revolution has taken hold, AI and data science have become indispensable tools for freight procurement and logistics management businesses when it comes to boosting their efficiency and revenue. Yet, while many “old school” procurement and logistics processes have been overhauled using modern computing tools, one process continues to be stuck in yesteryear: freight tendering! 

Much like in many business verticals, understanding supply and demand in logistics is pivotal to making sound, profitable decisions. Unfortunately, thanks to the data gaps and other hurdles that exist in the logistics space today, understanding supply and demand in freight procurement is incredibly tough to nail down. But this doesn’t have to be the case. Here are a few ways to crack the supply and demand code:

Although data continues to help proliferate the supply chain, making companies more agile and boosting revenue, there’s one critical area that has lagged behind: logistics. Shippers use data to measure when products are picked up and dropped off and where a shipment is along a given route. But this data only tells half the story, which means logistics managers are missing key insights in order to drive efficiency across freight procurement operations.

Shippers have become accustomed to having more questions than answers when it comes to working with their broker market. However, arguably no area of the broker market is more confusing or opaque than costs and pricing.

Rife with hidden fees and unclear metrics, the broker market makes it virtually impossible for shippers trying to find out what the true cost of a load is. This is obviously not only infuriating but results in significant supply chain waste that can add up quickly. 

Customer service is key to building strong relationships that sustain success in any industry, but especially in freight procurement. That said, many parties within logistics fail to exceed defined service goals. Luckily, there are tools and tactics that shippers can use to strengthen customer service from 3PL providers. Here are a few suggestions.  

Freight procurement and logistics professionals are increasingly relying on data to drive their business decisions today. However, given these spaces are traditionally slow-moving when it comes to adopting technology, organizations within these fields find themselves at varying levels of maturity when assessing their data infrastructure. Yet, whether you are a company that is already well-versed in integrating data into business intelligence decisions or a company just starting to get a data infrastructure in place, data interchange is one of the foremost data-related challenges throughout freight procurement and the broader logistics space. Luckily, however, advanced computing such as artificial intelligence (AI) and machine learning (ML), along with other sophisticated data science tools, are helping shippers become much more agile.

The impact that cost of goods sold (COGS) has on a company’s bottom line cannot be understated. Yet, for all of the attention that businesses dedicate to traditional COGS elements such as manufacturing, materials, and labor costs, one key area is constantly overlooked when it comes to COGS planning, strategy, and execution -- transportation.

Have you ever experienced a diagonal or horizontal crack in your home’s foundation? If so, you know leaving these cracks unattended will lead to bigger problems and costly repairs. If a shipper's freight procurement process is static and stymied by lack of capacity, then the shipper has cracks in its foundation too. Unfortunately, if left unattended, the shipper runs the risk of:

The freight market continues to carve out new records, and last week is no exception. Tender rejections remained above 25%, which is no surprise because it’s been there for months. And reefer is even higher at 50% rejection. All that said, the big surprise is that DAT reported contract rates ($2.76 per mile) higher than spot ($2.62 per mile).