Logistics is a notoriously volatile industry. During market shifts, it can be difficult for shippers to decide which modes, providers and contract/rate types will serve their business best. In the constant race to keep up, many default to the most common solutions, unable to set aside the time required to look deeper into their options. Ultimately, this approach leads to lost time, lost money and lost opportunities.
In a tight capacity market, it can be difficult for shippers to effectively score and manage carrier performance. This is especially true when variables affecting carriers – such as hours of service, traffic volumes, COVID-19 and safety protocols – are taken into account. In a pressurized environment, it’s difficult to know which suppliers are serving shippers and carriers well and which are not.
“In a constrained market, every single truck has a previous shipment and every single driver is grappling with hours-of-service issues,” Bryce Williford, BlueGrace’s senior director of logistics, said. “Accurately managing a carrier’s performance is a challenge. Trucks and drivers aren’t just sitting around waiting for freight, and conversely, the warehouses are also not just waiting around waiting for trucks to arrive.”
Partnering with a fourth-party logistics provider (4PL) can help shippers focus on service and stability while optimizing their supply chains to make execution easier, not harder. The 4PL model takes the third-party logistics (3PL) model a step further by helping shippers manage their resources, technology and infrastructure. This approach provides shippers with an added layer of aggregation, integration and execution.
“The 4PL model gives you the ability to look at a group of incumbent providers across multiple modes and gain visibility to all relevant and actionable data,” Williford said. “It is so valuable to a shipper to gain visibility to things like cost to serve, inefficiencies and opportunities for automation. Visibility into data helps them choose the right modes and the right providers to achieve their goals.”
The information 4PLs offer shippers is invaluable in navigating volatile and dynamic changing markets. Companies have the data they need to make the best decisions for their customers and businesses, but that data is useless when stored in inefficient, untapped silos. The right provider can help shippers uncover the useful information in their existing data sources to take action.
“If you don’t utilize the data in your supply chain, you’re missing out,” Williford said. “There are so many providers who will analyze your data for free and give you recommendations for improvement. This allows you to improve service levels, gain stability and evaluate internal goals and business needs.”
Shippers can know exactly where they stand with their own business goals, and they can measure which providers are serving them best. Collaborating with a company like BlueGrace Logistics on strategy and execution can help shippers identify areas of potential cost savings, risk mitigation, opportunities for supply chain automation and better utilization of technology and resources.
“There is so much uncertainty in the supply chain. It is the only consistent factor we are running into right now. The industry is in a constant state of disruption,” Williford said. “Overall, when approaching the market as a shipper, you want to have supply chain providers willing to adapt and change with you.”
Shippers who become experts in their own supply chains will have a leg up on the competition, helping them navigate today’s strained markets and positioning them to respond appropriately to whatever happens next. After a year like 2020, planning, preparation and execution are more important than ever.