Education Workshop: RFP Best Practices
Authored by SMC³ on August 10, 2021
Building a Future-Proof RFP Strategy
The challenges of the past 18 months, coupled with the explosion of ecommerce, have created a rapidly changing transportation environment. Manufacturers, retailers and wholesalers—across industries—are finding their shipping needs have evolved to include new volume, new locations and new risk management solutions.
As a result, many are opening up their RFP processes to new prospective carrier partners as they look for new ideas and competitive prices to carry them forward into the post-pandemic world. In order to successfully navigate the RFP process and create meaningful contract discussions that serve both shippers and carriers, Ryan Poynter, SVP of LTL carrier relations and pricing at GlobalTranz, John Kruzan, director of client success at SMC³, and Dave Woodwyk, VP of pricing and yield management at USF Holland, took to the SMC³ Connections 2021 stage to highlight a few of the trending best practices and digital solutions both carriers and shippers can use to create productive efficient RFP processes.
“We’ve seen an increase in RFPs from our 3PL perspective,” Poynter said. “They are looking for help. They want to make sure a service provider is servicing their shipments in the way they need—giving them the right tech to bring together multiple different carriers and make sure they are choosing the right one for their business.”
First and foremost, Poynter says, the key to laying the foundation for a fruitful RFP process depends on providing accurate data. While it might make sense to leave out minor details in the RFP, assuming those details can be hashed out later, Poynter says it’s critically important to put all the chips on the table right away.
“The best RFP will always be a package that gives carriers a good indication of what to expect,” Poynter said. “That means lane data, freight profile, accessories—whatever they need to get a comfort level when they put their pricing together.”
From the carrier perspective, Woodwyk says he likes to see at least one year’s worth of data to allow his team to account for seasonality, and quarterly surges when they submit a bid and commit to a longer-term partnership.
So, the question becomes — how can shippers make sure they are giving carriers all the information they need to adequately understand and price the contract?
While paper RFP and bidding processes can still accomplish this task, both Poynter and Woodwyk agree that digital solutions present a valuable opportunity to streamline the process and ensure incomplete information or misinterpreted data doesn’t get in the way of an accurate bid.
“More and more data is digitized,” Woodwyk said. “Now, it is easier to transport data between entities and make it usable, regardless of format.”
Digital bidding and pricing solutions, like SMC³ Bid$ense®, offer an increasingly valuable way for shippers to engage with new carriers—and more importantly meet each of their individual needs for RFP information. Additionally, they offer shippers a way to execute micro-bids more quickly and more accurately, as an alternative solution to spot-market capacity.
As a result, both carriers and shippers are equipped with greater market visibility to make decisions about market rate prices and services as transportation capacity rises and falls in a highly volatile post-pandemic world.
Want to learn more about the technology at the center of RFP innovation? Head over to our product page to learn more about the SMC³ Bid$ense tool and how it can help facilitate more efficient sourcing and pricing negotiations.