September 19, 2023

Meeting with a new transport provider? Here are the 6 most important questions to ask.

Discover the top 6 essential questions for a successful transport management partnership. Explore our latest blog post to prepare effectively for this peak season and beyond.

Meeting with a new transport provider? Here are the 6 questions to ask

In today's interconnected economy, the efficient movement of freight is the backbone of many industries. Whether you're a manufacturer, retailer, or distributor, partnering with the right transport provider can make all the difference in ensuring your goods reach their destinations reliably, on time, and as efficiently as possible. With the broad range of providers vying for your business, making an informed decision requires more than just a fleeting assessment.

The key to a successful logistics partnership lies in asking the right questions. By delving deeper into a provider's strategies, policies, and capabilities, you gain invaluable insights into their ability to align with your unique transport needs. 

From pricing structures to sustainability commitments, technological features and strategies for managing unpredictable surges, in this blog we've outlined the essential questions you should ask your potential transport provider before entering a partnership. While you might frequently engage in these discussions, there's enduring value in ensuring alignment between your team and transport providers regarding the critical commercial structures underpinning your supply chain relationships, especially in the lead-up to peak season. Whether you're a seasoned logistics professional, a procurement specialist or business owner, these questions empower you to uncover crucial information for a successful partnership. 

Rates and Pricing: Avoiding Surprises 

Question 1: What is your pricing structure? How does it apply through the year, including periods of high demand?

Understanding a proposed pricing structure provides you with visibility across the full suite of services you’re paying for, and the cost elements that drive them. This is essential for managing budgets and preventing any unexpected or hidden charges. The application of different pricing models - for example, pricing based on a full truck, pallets or pallet spaces, on a weight or other size basis - can vary the profile of your overall shipping costs. With clarity on your proposed pricing structure, you can accurately estimate and manage your freight costs accordingly. 

With clarity on the pricing structure, you can identify opportunities to improve efficiency and optimise costs. For example, if you have daily dispatches of pallets to the same destination, you may consider holding on a few days to consolidate into a full truck load or if your products are typically large and light cartons, you might explore the opportunity of obtaining rates per kilo, rather than rates per pallet. Some providers offer flexible pricing models that can be tailored to your unique requirements, and by knowing this information, you can discuss potential customisation options.

Understanding all components of the freight cost and their calculation methodology also prevents any confusion or misunderstandings about why the charge exists and how it's determined. As an example, fuel levy is a common surcharge applied on top of transport rates to cover variances on fuel costs. Providers that are able to  openly share their fuel levy calculation methodology demonstrate elevated commitment to providing accurate information and dedication to build trust in the partnership.

Peak seasons often come with increased shipping costs due to higher demand and limited capacity. Knowing if your transport provider can secure rates during peak season helps you plan more accurately and prevents unexpected cost spikes.

If you are able to estimate volumes, it might be a good strategy to work with your provider and establish an agreement to secure rates, especially during seasonal periods of high demand. It will strengthen your  partnership with carriers, ensuring your shipments can be accommodated and avoiding unexpected cost increases. From the carriers' side, securing rates demonstrates their commitment to meeting customer needs even when the market is challenging and positively reflects on their dedication to service excellence.

Managing Truck Capacity: Service Continuity 

Question 2: What is your fleet composition and how do you manage service continuity?

Understanding the available truck types allows you to choose the right provider who can best match your shipment’s size, weight, and volume requirements. This prevents overloading or underutilisation of truck space, helping to improve operational efficiencies which has added benefits such as cost reduction. 

Knowing the range of available truck types gives you insight into their fleet size and their ability to handle shipment volumes, and periods of high demand. If your shipping needs change or grow over time, knowing the variety of available trucks can help you determine whether they can accommodate your evolving requirements.

Even during unexpected surges in demand, you want to ensure that your shipments won't experience delays or disruptions. Dig deeper, and asking them about their capacity expansion strategies provides peace of mind and insights into their preparedness, flexibility, and their ability to maintain service quality during the more challenging periods. Lead times are also another important area to understand. The lead times give you an idea of how much advance notice the provider requires for arranging and executing shipments which is an indication into their connected transport network. 

Customer Service: Transparency and Accountability

Question 3: What are your customer service capabilities, communication practices, responsiveness, and commitment to meeting our needs? 

A truly customer-centric transport team sees themselves as an extension of your team. In the face of any challenges that may arise, such a team will often go the extra mile to achieve a mitigation or resolution - this is the kind of team you will want to work with.

The provider should have a dedicated customer service team - this tells you that they prioritise personalised support and streamline communications to allow for consistency in every interaction. It’s important to ask the available communication channels (i.e. phone, email, online portal) to ensure you can reach them in the method that works for your team. An online system is a value-add and can truly enhance convenience and accessibility for tracking shipments and managing requests. Openness about communication during unexpected events (such as weather disruptions or delays) helps you understand how promptly they notify you, and manage expectations. 

A commitment to always improving is a standout, and a provider that enables an avenue to deliver feedback is an added bonus! A Net Promoter Score (NPS) demonstrates they are truly committed to improving their services, and that they listen and care about ongoing customer feedback. 

Technology and Visibility: Advanced Logistics 

Question 4: What are your technology capabilities and how do you automate and improve supply chain processes?

Technology plays a transformative role in modern logistics and supply chain management and the integration of advanced technology can significantly impact the efficiency, accuracy, transparency, and overall success of your shipping operations. Real power can be unlocked when you have full integration (and transparency) across the entire supply chain. This allows businesses to better optimise delivery slots and warehouse allocations to improve efficiency and reduce costs. 

Partnering with a transport provider with a technology platform gives you access to digital capabilities and, in some cases, advanced tools for managing shipments. Request a demonstration to see firsthand how their technology works and ensure it works for you and your team. The features of the technology platform are also important. This should include tracking, performance reporting, integration options, and data analytics capabilities. Performance reporting is extremely important as it provides insights into past performance, helping you identify trends and areas for improvement for your business to act on. 

Other important features might include compatibility with your existing systems, such as ERP software, to streamline processes and reduce manual data entry, as well as automatic notifications to keep you informed about shipment milestones. 

Safety and Compliance: Spotlight on Safety Practices 

Question 5: What are your safety and compliance policies and how do you mitigate risks?

Safety and regulatory compliance are paramount in ensuring the secure and smooth transportation of your goods. The logistics industry is subject to numerous regulations and standards. In 2012, 23-year-old Sarah Frazer was driving along the Hume Highway to her university in Wagga Wagga when her car broke down. After pulling into an emergency breakdown lane she called for assistance. While the tow-truck driver was loading up her car, a truck side-swiped it and collided with both of them, killing the pair instantly. It’s incidents like this that serve as a reminder that there is nothing more important than safety within the transport industry, which is why safety and compliance must be on your list of questions.

If a transport provider does not have a Chain of Responsibility (CoR) policy, you should not continue the conversation. A robust CoR policy, and procedures and practices that uphold that policy, indicate the required level of understanding of the legal framework that holds all parties in the supply chain accountable for safety in transportation. It recognises that safety is a shared responsibility that extends beyond just drivers to include transport operators, logistics managers, warehouse managers and, importantly, company directors. 

CoR empowers regulatory authorities to take action against any business or individual within the supply chain that neglects its safety responsibilities, creating a strong deterrent against unsafe practices. Make sure this is made available to read and that the documentation includes all relevant policies (i.e. Drug and Alcohol Policy, Fatigue Management Policy, Load and Restraint Policy). 

What’s even more imperative is if the provider has training in place for all team members, not just those directly involved in the transporting of goods. This indicates their focus holistically on safety across all functions and departments. Companies such as CoRsafe represent a number of brands to help companies understand and manage their CoR risks, as well as provide the necessary training for all staff, no matter the role they play. 

Sustainability Focus: Supply Chain Emissions

Question 6: What is your company's commitment to sustainability and what initiatives do you have in place to support your customers ESG strategy?

The transport industry is a major contributor to greenhouse gas emissions, making it a leading cause of global warming and climate change. You should aim to gain a comprehensive understanding of your transport provider’s environmental efforts and commitment to supporting your business in reducing its carbon footprint. An environmentally focused transport provider will have examples of concrete actions they are taking to help businesses reduce their scope 3 emissions. Ask to see what initiatives they have in place with other customers, and see their actions in practice!  

A company who is serious about reducing the CO2 impact of their operations should have the ability to track, measure and reduce emissions as well as offer offsetting programs. This should be backed up by an accredited organisation using a recognised methodology for harmonised calculations and reporting of greenhouse gas emissions footprint across a multi-modal supply chain. The provider should allow customers access to on-demand emissions data in real-time that has a focus on actionable insights for emissions reductions. Make sure your transport partner takes sustainability seriously and plans to evolve and enhance their sustainability initiatives over time. If they are leading the market, they will have a zero emissions transportation roadmap which demonstrates their reduction targets. 

Remember, a reputable transport partner should be transparent across all these six areas, have a partnership-minded approach, and be willing to deliver clear answers to help you make the right decision for your business. Lastly, don’t be afraid to ask for customer references to verify their claims. It’ll provide reassurance, and credibility to ensure you are making the right decision. 

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