The global supply chain and freight forwarding industry is a complex set of operations that ensures that goods get to their desired destination under the right conditions. Considering the recent geopolitical tensions involving different countries across major regions of the world, there has never been a more volatile time in the freight industry. Shippers, carriers, and freight forwarding operations need access to real-time or updated rates to navigate the current freight market effectively. And one of the strategies for achieving this is leveraging freight procurement software.
What Is Freight Procurement Software? The freight procurement software is a platform that allows users, typically shippers and freight forwarders, to access freight services, compare rates, negotiate, and strike deals with carriers. It acts as a digital assistant that helps businesses navigate the freight forwarding industry, including communicating with them seamlessly.
The freight procurement platform can be leveraged to ensure the entire freight forwarding operation is undertaken seamlessly. But more than that, in an ever-volatile market, it serves as a tool that guarantees stable rates because these platforms have access to several carriers.
Why Does a Freight Forwarder Need Freight Procurement Software? Because of the volatile nature of the freight market, and even more so with the recent global tensions, freight procurement software comes in handy for businesses in the freight-forwarding industry to get their shipments to different locations across different markets.
These are what a typical freight forwarding business expects from the freight procurement software:
1. Quicker Rate Procurement Post-pandemic, almost every industry has been quick to adapt to automations and digital transformations. Similarly, freight forwarders, who have long been less tech savvy, are now eager to add digital tools to their arsenal and streamline their rate procurement workflows. Manually acquiring spot rates, constantly updating them in case of changes and putting together a quote is exhausting.
Freight procurement software offers the much needed respite for these professionals and enhances their productivity. With freight rate procurement tools like Freightify, freight forwarders can procure rates and send quotes in less than 2 minutes, allowing you to book more clients without relying on more resources.
2. Streamlined Procurement Process For freight forwarders and procurement managers, evaluating the right carrier, negotiating contracts and prices, bid management, compliance management can be taxing to handle given that freight procurement is heavily sensitive to geopolitical tensions.
Freight procurement tools streamline these workflows by automating rate procurement, bid management, carrier benchmarking, quote generation, etc. . Freight procurement tools streamline list of carriers, which saves the freight forwarding business much stress trying to sort them out. It also provides the rates of each of these carriers in real-time, allowing for effective supply chain planning and enabling forwarders to close deals faster. Moreover the freight procurement toos’ rate management features automatically update rates when carriers make amendments to these rates. Rate management features ensure amendments are updated on a frequent basis.
3. Cost Savings The freight procurement software allows freight forwarding businesses to leverage data analytics to negotiate effectively with carriers. These businesses can also use the platform to identify cost-saving opportunities, but more importantly, the platform ensures that rates are benchmarked, allowing businesses to plan operations to reduce these costs effectively.
4. Improved Visibility and Transparency Visibility and transparency are critical attributes of modern supply chain management. And the freight procurement tool provides these for freight forwarding businesses and shippers alike. With the platform, businesses get access to real-time updates concerning the industry and track their shipment status in real-time.
This helps ensure that the businesses can identify potential problems before they arise or on time, ensuring they can take the necessary steps to prevent the situation from causing more trouble than necessary to the shipping operation.
5. Standarizing rate formats The typical freight procurement platform enforces standardization of rates.When dealing with carrier rates in a variety of formats, your pricing or procurement team will find it challenging to compare and analyze them effectively.
Rate procurement features in a freight procurement tool can consolidate rates from different formats into a single, standardized format. This process involves converting contract rates from various sources and formats into a unified structure, making it easier for you to understand and manage your pricing information.
6. Other Reasons Why A Freight Forwarding Business Needs Freight Procurement Tools Scalability Flexibility Enhanced Collaboration Data-Driven Decision Making Best Freight Procurement Software in 2024 There are a few freight procurement solutions in the market today. Here are some of the best in 2024.
1. Freightify Freightify is a SaaS platform that allows freight forwarders to procure, manage, and quote freight rates: all within 2 minutes. According to G2 reviews, Freightify is conferred “Leader” in the freight management category.
With the platform, any forwarder can create a digital storefront to serve their customers better. In addition, these businesses can leverage the Freigtify tool to track and trace their shipments from source to destination.
Key features Rate Procurement: Real-time rate s and access to global carriers from one platformRate Management: Add new rates in multiple ways, search and filter the rates efficiently, and automatically add margins using rules.Quotation: Generate a quote for clients in less than 30 seconds, see and manage all the quotes in one place, and send the quotations to clients anywhere in the world, anytime.Customer Portal: Freight forwarders using the platform can create customized portals for their customers. This allows customers to interact and engage with the freight forwarding business services seamlessly.Integrations: Freightify’s API allows you to integrate with your TMS, CRMs and other carrier websites to track and trace your goods, and obtain more visibility and transparency throughout freight forwarding.Contract Rate Sheet Conversions: Freightify has Automated Contract Rate Sheet conversions in place that has 99.8% accuracy in processing of rate sheets. Freightify has automated rate sheet processing of at least 30+ major carriers. Pricing The Freightify platform has different price ranges:
Essentials: $999/month Standard: $1499/month Enterprise: Customizable (contact Freightify for more information) Ratings 4.8 out of 5.0 (based on G2 reviews)
2. GoComet Freight Negotiation Engine GoComet’s freight negotiation engine is an automated negotiation system that allows users to secure the best deals from vendors. The tool enhances transparency throughout the procurement process and helps reduce turnaround time.
Key Features Transparent procurement process: With GoComet, freight forwarders and shippers can enjoy transparency in the rate procurement.Automated negotiation system: The platform helps freight forwarders negotiate correctly and efficiently with carriers, leveraging details on current market rates.Real-time vendor performance analytics: Collating and analyzing carrier performance in real-time allows them to effectively manage carrier relationships.Rating 4.8 out of 5.0
3. Coupa Coupa's RFQ management software is an AI-driven freight rate procurement tool that ensures seamless and real-time rate acquisition for freight forwarders. It also offers powerful and simplified RFQ management solutions.
Key Features Freight Quotation: Enhances access to instant freight quotationsDashboard for consolidated rates: Allows single view for all rates, including those from carriers and those for shippersVendor bidding via email: More bidding options, including emailing access.Quote comparison: Seamlessly compare quotations from other vendors for easy analysis.Ratings 4.1 out of 5.0
3. Alpega’s Freight Cost Management Software
Alpega is an automated platform that allows its users to obtain a quick and comprehensive overview of total freight cost and visibility, all the way down to individual cost types, as well as conducting freight costs analytics amid a challenging and time-consuming operation.
Key features Contract management and invoice settlement are used to speed up payment cycle time. Digitized and automated rate procurement: Automatically scan the market to acquire rates in real time Cloud-based platform for flexibility and scalability Comprehensive overview of total freight costs Ratings 4.1 out of 5.0
4. Transporeon Freight Procurement Software
A freight procurement tool that helps its users find the best rates across the freight market and access the largest carrier database with a fully digital freight matchmaking solution.
Key features Centralized data handling for freight rates Transparency in freight rate management Centralized storage for freight contracts and documents Simplified processing of complex pricing plans Ratings 4.1 out of 5.0
5. FreightPOP FreightPOP is a rate shopping dashboard that pulls the users' negotiated rates, the platform's negotiated rates, and marketplace rates into a single view. Users of the platform can simply fill in the shipment information or automatically pull it from their ERP or CRM using FreightPOP's robust integrations. Users can compare rates for unlimited shipments, email quoted rates to your team directly from the app, save a quote, and return later to process the shipment.
Key features Multi-carrier rate shopping for more robust pricing Email quotations directly from the application anytime, anywhere Shipment information autofill for return customers, helping them save energy Rate Shopping dashboard for easy comparison and decision-making Ratings 4.7 out of 5.0
Key Features to Look For In Freight Procurement Software To have the best time using the freight procurement software, some features must be present.
1. Intuitive, easy-to-use platform Given that most forwarders dabble with spreadsheets to maintain carrier rates, freight procurement software should be geared to solve the fragmented view that spreadsheets impose. The UI must be designed to streamline information such as carrier ratings, rates, and availability. They must also centralize bid management and negotiations on a single view and help forwarders make decisions on the fly, eliminating the need to spar with spreadsheets.
2. A proactive customer support Customer support teams can help freight forwarders and procurement managers by explaining to them how to effectively use features for rate comparison, carrier selection and bid management. Moreover, since freight procurement processes are influenced by global challenges, forwarders and shippers can easily lose their credibility if they aren’t up to date on maritime bottlenecks. Customer support teams can bridge this knowledge gap and keep freight forwarders informed so that they can optimize procurement resulting in better relationships with clients and vendors.
3. Rate Management The tool must come with rate comparison, optimization, and benchmarking functionalities. This way, users can analyze and compare freight rates from multiple carriers to secure the best shipment pricing.
4. Integration and Analytics Capabilities The software must be able to integrate seamlessly with other technology solutions such as TMS, WMS and CRMs, and it must have robust analytics and reporting tools that provide actionable insights into freight forwarding performance.
5. Tracking and Tracing Visibility and transparency are all the rage in modern shipping and supply chain operations. It must come with robust and effective tracking and tracing features to achieve with the freight procurement software.
6. Automated Procurement Processes Good freight procurement software automates the procurement process, allowing users to request quotes, negotiate rates, and manage contracts efficiently.
7. Carrier Management A centralized database of carriers, performance tracking, qualification criteria, and how each carrier meets these qualifications. With these, freight forwarders and shippers can better manage the carriers.
8. Contract Management A freight procurement platform with contract management capabilities allows users to store, track, and manage freight contracts. This helps ensure carriers comply with contract terms. It also enables users to monitor contract performance and mitigate risks.
Frequently Asked Questions How does freight procurement software work? The freight procurement software is a digital platform that helps organize and simplify the rate procurement for shipping services. It also helps manage these rates by providing quotations, adding margins, and real-time updates on rate changes.
What are the benefits of using freight procurement software? There are several benefits to using freight procurement software. Some of them are streamlined procurement, enhanced visibility, cost savings, compliance, collaboration, and scalability. Overall, it helps ensure the procurement process is faster and more efficient.
Can freight procurement software handle different modes of transportation? Yes, freight procurement software can handle different modes of transportation, including ocean freight , trucking, and air, but it is crucial it understands each market and the modalities you prefer.
Is freight procurement software suitable for businesses of all sizes? Yes. Businesses of varying sizes can leverage the freight procurement tool, and businesses that rely on it can scale their operations up or down without worrying too much about the cost.
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