It pays to explain your business well to your freight service providers. Holding back vital information from them ultimately results in poor pricing.
Too many people are holding back vital information from their freight service providers and paying a high price as a result.
Getting the best freight solution for your company is not easy. It requires specialised industry knowledge and should be viewed as an ongoing project in the face of a constantly changing environment.
The most important aspect of getting your best freight solution is the relationship you have with your service providers, be they shipping lines, freight forwarders or a customs broker.
In my experience the best relationships are the ones built on trust. Trust comes with time and requires people to communicate openly and honestly to share information and ideas. When this type of communication is backed up with integrity and accountability, trust is formed. This perpetuates itself as people who trust each other communicate more openly, and so on.
In 25 years working as a customs broker, freight forwarder or for a shipping line, I have seen the best results where there are strong relationships with customers. This type of business environment creates an energy that fosters creativity and a willingness to go the extra mile.
What’s the alternative? Don’t share information about your business, delivering instead the old “send me your best rates and I will have a look at it” line. The strategy of holding your cards close will simply make it hard for any service provider to match the best solution to your business need.
I wonder what the local plumber would say if I called him and said I want to buy a heat pump and install it — how much? If he’s polite he would ask me some questions and want to visit me at my house so he can find out what I am trying to achieve with this heat pump. He would want to learn what’s important to me and see if a heat pump really is the best solution.
So if the plumber just gave me a price as I asked and we didn’t share any more information, what is the likelihood of a good outcome for either party?
So where do you start? I suggest you arrange a meeting with your freight forwarders or shipping lines.
In this meeting find out what they know about your business. This could be interesting and you may be surprised by the areas of your business they are unaware of.
Don’t be disheartened – this is a good sign because you will have uncovered an information gap and can explore an opportunity for improvement. So now enlighten them – tell them about your lead times, production, terms of sale, company structure and even broaden out to the challenges that face your industry as a whole.
Okay, so it’s not all up to you – as the cliché goes, it takes two to tango. Yes, your service provider should also tell you what is important to them. But more importantly they should be investing the time to understand what they can do to best serve you. So why is this not happening?
Freight is a very competitive industry. As companies embrace technology, employees are serving a larger customer base with fewer staff. This is particularly so in sales and customer service, which has the most contact with you, the customer. This means they have less time to spend with you than before, so one challenge you face is getting their real attention. It’s not uncommon to hear “I use xyz but I haven’t heard from anyone there for months”.
From the customer side there is a fear of telling everything, giving away too much information, especially in a negotiation, and expose vulnerabilities the other party can exploit. Almost everyone can recall a bad experience in the past when dealing in the freight industry. This has built up mistrust.
The underlying good news is that this is a service industry and many people in it are problem-solvers by nature. They are solution-orientated and want to help. The industry also keeps people – shipping gets in the blood. So there is a lot of experience out there, a real resource that can work for you if you can tap into it.
So grab their attention by taking the initiative. After all, you have the power to change if you are not getting the best freight solution. But rather than change, can I suggest you invite them over for a cuppa and let them know about your business. [END]
Editor’s note: The views expressed above may not necessarily reflect the view of this magazine but we are happy to provide the space for gutsy opinion