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An effective freight management system improves operational capacities by enhancing turnaround time, booking processes, and transparency and reduces human errors.
FREMONT, CA: Digital transformation shapes global industries, especially freight and logistics. While technology seeks to centralize this widely fragmented industry, one of the key challenges still faced by freight forwarders is rate management inefficiency.
Freight sales executives spend about 43 percent of their time quoting and pricing. Manual entries, unregulated pricing, and delays in quoting all contribute to errors, which cost time, money, and resources. A rate management system eases these operational challenges.
An effective freight management system can resolve the following challenges.
Faster turnaround time: A spot quote request typically takes 67 hours to process across the industry. An average customer waits close to three days, and it usually takes days to pull quotes without a freight rate management system.
Automatic crawling of contract rates from available carriers involves the subsequent generation of on-demand quotes based on customer queries. Businesses grow by providing high customer satisfaction when forwarders invest in developing internal processes.
A more efficient booking process: There are many parties in the logistics chain that forwarders interact with simultaneously, such as customers, shippers, managers, and transporters. Operational efficiency often suffers when processes need to be organized better.
Transparency: Undisclosed charges and delays in quotations don't appeal to customers. Miscommunications or untimely relay of information due to a lack of transparency among stakeholders cause unnecessary lags and costs.
Customers can get detailed quotes online using RMS by fetching reliable data from carriers, transporters, and agents. Companies can present their customers with a detailed, transparent breakdown of all shipping costs in advance. The team can also plan routes and optimize costs by leveraging actionable data insights from an RMS.
Reduces human errors: Human error is a common problem with manual rate management systems. Spreadsheets, such as MS Excel, are typically used to process complex pricing data. Emails are sent to customers with assembled rate sheets and folders.
This process has challenges, as there is almost no way to avoid errors when entering data at multiple locations. In the event of even a slight error in data entry, the company and customers can suffer massive losses.
Evidence shows that 15 percent of carrier invoices are incorrect, and 80 percent of logistics companies pay extra for freight services. Invoicing errors alone cause industry losses of about USD 700 million each year.