A key aspect of international shipping is negotiating and booking rates with ocean carriers. Those involved in negotiating these rates want to get the best rate for the correct service level. A recent FourKites survey found that rates and booking were two of the top challenges in international freight. In the same survey, quotes and booking were automated only 7% and 6% of the time, respectively. From these numbers, we can see a gap where digitization and automation could alleviate some of these challenges and provide a significant boost in efficiency across the end-to-end supply chain.
Many shippers are aware of the challenges when it comes to track and trace. In a FourKites survey, senior supply chain leaders identified the length of time waiting on rate quotes and the cumbersome booking process as key challenges in the international freight process.
This is not surprising! If you think about the process for getting a quote, shippers will request quotes from each ocean carrier for each lane in which they ship specific commodities or products. In return, carriers will provide very large excel spreadsheets, with hundreds of rows of rates, cost structures, predefined international commercial terms — called Incoterms — and more. For large shippers, it is an incredibly daunting task to analyze and pick the best rates for the service level. Additionally, there could be hidden terms that are not seen at first glance, making the booking process very cumbersome once shippers are ready to choose a specific rate for a particular lane.
In the same survey of supply chain leaders, 42% said they were looking to upgrade their systems by investing in digitization of their international shipping process. Moreover, 37% said they were looking to upgrade in the next 1-3 years. With this in mind, what should organizations look for in solutions that provide automation around the rate and booking process?
When evaluating platforms that can help automate the rate quotation process, look for capabilities around easily understanding and analyzing the rate cards provided by carriers. FourKites Dynamic Ocean allows users to upload the rate card they have received from the carriers and receive an easy-to-understand analysis of the different rate quotes available, saving both time and unnecessary transportation costs.
Additionally, being able to explore rate quotes across carriers is another benefit to digitizing the rate and booking process. With solutions like Dynamic Ocean, shippers can minimize the number of rate cards they receive from carriers to streamline the rate process into a single platform. By exploring rates within one solution, you can easily get rates; compare carriers, lanes and cost structures; and save time by eliminating unruly rate cards and back-and-forth emails with carriers.
One-fifth of the senior supply chain leaders surveyed said that the cumbersome booking process was one of their primary challenges. Shippers should look for solutions that provide an easy-to-use rate management and booking process in one streamlined platform. Case in point? One FourKites customer was able to reduce the booking time from over 2 hours to 20 minutes with a streamlined booking system. And shippers that use a TMS should seek out a platform that provides easy integration with that TMS.
While supply chain leaders identify key challenges around rates and booking, these challenges can be minimized with solutions that analyze rates and manage booking within a single platform, allowing shippers to achieve a streamlined booking process, a less disrupted ocean journey and a great return on investment for the organization.