Supply Chain Benchmarking for Beginners

You don’t have to use historical data to justify your contracts…or at least you shouldn’t. Transportation pros from the executive seat down to the entry-level analyst have better data to lean on to make their jobs easier. 

A common way for shippers to run RFPs, annual bids or even shorter projects is to simply rely on pricing data from a core group of trusted carriers and brokers. This is fine when it comes to doing things the way they’ve always been done, but it leaves plenty of room for risk. On the surface, this feels like the easy way of doing things, but as you dig deeper, it actually creates more work in the long run. 

The issue is this: many brokers and carriers will price freight based on current conditions without proactively projecting shifts in the market or considering lanes with volatility. They will not expose themselves when it comes to high-margin lanes, and they often overextend themselves in areas they may not be able to service. This is where having external benchmarking and analysis data becomes critical. SONAR Supply Chain Intelligence (SCI) empowers companies to strategically look at large projects or annual bids differently. Users are able to maintain a relationship of trust with their partners while also having access to more intelligence at the negotiation table.

More Than Rates

Traditional benchmarking tools only look at static pricing at the lane level. Some companies offer visibility into the fluctuation of a rate over time. In reality, any company can understand a rate with relative confidence. Where SCI turns rates into something more is by looking beyond rates. By looking at lanes and whole supply chains with greater context (tender data, lane scores, peer rates, etc.), companies can know how to react with the rate responses they get. Rather than setting up a routing guide based on the lowest possible rate, shippers can create more realistic expectations around how their waterfalls will perform.

SCI identifies areas of overpaying and underpaying to help decision makers optimize spend and reduce risk. It gives users the ability to adjust fuel schedules and timelines and to create unique scenarios so that they can create a more accurate future for transportation operations. This means harder work up front so that life can be easier down the road. In reality, this means making life easier for the entire organization and creating smarter budgets. It’s a win-win for everyone. 

Companies frequently find millions of dollars in savings while minimizing risks down the road by partnering with SONAR.

Find out more and get connected!

Related Posts

The Golden Handcuffs and the Key to Unlocking Success for Brokerages

The Waterfall Theory of Freight

Tai Software, FreightWaves SONAR team up to shape future of logistics industry

Search

Search

What's the SONAR ROI?

By increasing the number of loaded miles per day your drivers drive by 1% and your rate per mile by $0.03 you will make more per week #WithSONAR.

#WithSONAR you can save up to per week through better bid negotiations and more effective management of your routing guide.

#WithSonar you can add 1 more load per person each day and increase $5 margin per load, earning your company an extra per week.

Disclaimer: Every company’s circumstances are unique. Fixed and variable expenses, market conditions and operational factors vary. Unforeseen events may also affect results. Calculated potential results reflect the consensus expectation of FreightWaves’ experts. Actual results may vary.

Read Recent Posts

April 23, 2024

April State of Freight: The Ah Ha Moment

April 18, 2024

The Golden Handcuffs and the Key to Unlocking Success for Brokerages

April 16, 2024

Freight Market Data Sources

White Papers
April 23, 2024

The State of Freight – April 2024

March 27, 2024

The State of Freight – March 2024

March 21, 2024

Take Demand Planning and Forecasting to the Next Level: An Introduction to Tender Data