The logistics industry is in a state of flux, and prices of today do not necessarily reflect the actual shipping costs of tomorrow. In addition, the growing complexity among carrier selection and options can make managing inbound freight pricing changes difficult at best. Unfortunately, this contributes to issues in deciding when it is time to adjust shipping directions for vendors and suppliers. Often, shippers realize their interactions are out of date well after the fact, resulting in higher freight spend. However, shippers that take the time to inform vendors of inbound freight pricing changes and directions via the inbound freight routing guide can avoid these problems.
The problems with poor inbound freight management and dissemination of instructions for vendors are extensive. Poor communication with vendors and suppliers may result in significantly higher freight spend, as well as working with higher-cost carriers, delays to stocking in brick-and-mortar stores, and poor customer service. Unfortunately, vendors and suppliers that are still in compliance with outdated routing guides cannot be held accountable for a shipper’s failure to update the guide. Ultimately, shippers end up eating the costs of failure to maintain their writing; informing vendors of inbound freight pricing change as soon as they occur, such as through the use of the dynamic freight routing guide, can overcome these obstacles.
Inbound freight pricing changes must be easy to distribute and understand. It is impractical to give vendors a single carrier option, and this practice could result in higher costs when the carrier publishes a general rate increase (GRI). However, detailed inbound freight routing guides that are kept in an Excel format are also ineffective. Although vendors and suppliers may be able to use search functions, it is a time-consuming, laborious process. Instead, inbound freight pricing changes must be easy-to-distribute. In other words, systems must be intuitive, taking advantage of new resources, including a transportation management system (TMS) to empower suppliers and vendors with the right information at the right time, reports Jayne Marchesan of Talking Logistics. A TMS with an embedded, dynamic inbound freight routing guide handles the dissemination of information and gives shippers a way to proactively share changes to inbound freight pricing with all relevant parties.
Utilizing a TMS is not the only way to ensure that suppliers and vendors know what to do with inbound freight pricing changes. As explained by Inbound Logistics, shippers must leverage the inbound routing guide to ensure that vendors and suppliers understand their responsibilities for shipping freight to your business, which includes:
Inbound freight management is only going to grow in complexity. Shippers that do not have a handle on inbound freight routing and management will see increased freight spend and risks that adversely affect consumer experiences. Instead of leaving it to chance, shippers should follow the eight best practices for using an inbound freight routing guide and ensuring it is up-to-date.
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