Onboarding New Courier Partners? Here are Four Things You Need To Consider Before Accepting A Bid

With delivery SLAs evolving fast, capacity crunches becoming routine, and delivery margins shrinking, selecting a courier partner is challenging. Investments in courier partnerships need to be justified based on their flexibility, service quality, ROI in terms of customer service, ability to deliver on the agreed promises and more. Hence, we noted a quick list of things that will help businesses tick the right checkboxes before onboarding any logistics partner.

1. Deciding On Partnering with National vs. Regional Carriers

It’s incredibly critical that businesses gain an in-depth understanding of their transportation strategy before onboarding new logistics partners. For instance, one needs to know the different types of SLAs promised in disparate locations, what sort of delivery turnaround times are being looked at, the volume of goods or packages that are needed to be shipped on a single journey, what are the financial commitments involved and so on. These answers will accurately highlight the type of customer demands in specific geographies or locations and, in turn, will help narrow down specific carrier portfolios.

Regional carriers have specific coverage areas and provide multiple service type options within these areas. This makes them a lucrative option if businesses seek to deliver on tight-time SLAs. National carriers, on the other hand, provide the advantage of extensive coverage, but service times tend to be longer. As capacity availability remains a challenge due to skyrocketing online delivery demands, to meet fast fulfillment expectations, it might be viable to distribute load among multiple regional carriers to lower the risk of SLA non-compliance. Also, during peak shipping seasons, the shipping lanes of national carriers get overloaded. Partnerships with regional carriers on the same lane can help businesses shift and distribute the load and deliver on a promised date.

2. Gauging A Courier Provider’s Characteristics

When onboarding multiple courier partners, it’s critical that businesses reach out to the right logistics service provider that can deliver on specific shipping needs. Businesses spend a lot of time just trying to match a logistic provider’s KPIs with their shipping needs. This process can be quickly done in seconds with minimal investments by using historical data analysis regarding the different characteristics of carriers. These characteristics can include rates, flexibility, completion success rates, experience, variety of truck loads offered and more. Businesses can then send selected carriers customized proposals.

3. Selecting A Carrier-Based On Total Cost of Service

Once bids against proposals start pouring in, businesses must quickly identify suitable carriers. Financial viability plays a vital role in considering a logistic partner. Hence, factoring in all the variables that make up the total services cost for each carrier is an essential step in the process.

A granular level view of pricing based on dimensional weight, residential and extended area charges, fuel surcharges, cost of accessories needed to handle overweight and oversize packages and so on. Once all these payables are determined, creating a strategy to ensure efficient pick-up from a terminal is vital. In this case, a few other considerations come into the picture. For instance, understanding the alignment between your package density and arrangement of nodes and links with that of a carrier’s network and FTL shipment consolidations opportunities to shrink costs can make a significant difference. It’s also worth understanding the cost adjustments per package a carrier will make for a truckload during a specific period to ensure better cost-performance analysis of carriers.

Having said that, just focusing on the economics of shipping isn’t the best way to consider a carrier. Paying slightly more to drive exceptional logistics performance and ensure superior customer service indeed pays in the long run.

4. Track The Performance of Your Multi-Carrier Network

When tracking logistics service providers’ KPIs, gaining real-time visibility of their operations is vital. Technology makes this exercise seamless and simple. Using a unified courier management platform, businesses can access insights into micro-level carrier performance details. These include real-time data on where a shipment is vs. where it should have been, delivery delays, deliveries done before time and on time, number of RTO instances, reasons behind non-deliveries and delivery failures, number of attempts made to complete a delivery, fake attempts and so on. These insights will prove to be game-changing when it comes to reviewing your logistics partner’s performance post a deal is made and even while renewing contracts. 

Unified and real-time view of your multi-courier network helps:

• Reduce fake delivery attempts by 23%
• Shrink last mile delivery costs by 14%
• Boost delivery success rate by 8%
• Increase NPS score by 1 to 1.5 points

Embracing digital means of selecting, onboarding and managing logistics service providers is rapidly becoming a common practice. Two direct reasons are delivering cost savings and boosting logistics performance across first, middle and last-mile. Are you digitizing the critical multi-courier management operations?