Using Effective Rate Management to Boost your Drayage Trucking Business

DrayMaster’s Travis Barnier joins Let’s Talk Supply Chain to discuss effective rate management for drayage truckers and 3PLs

Intense competition within the drayage industry is causing trucking companies and 3PL providers to lower their price resulting in more stress on their business and slower growth. They often don’t account for all the additional costs in their quoted price, leading to extra post-shipment charges that upset customers and slow payments. In addition, they struggle to quote consistently across their organization and between customers impacting lane profitability.

In a recent podcast, Let’s Talk Supply Chain’s host Sarah Barnes-Humphrey sat down with Travis Barnier, DrayMaster’s Business Lead to discuss the challenges drayage carriers face maintaining healthy margins, high customer service levels, and a strong bottom line – and how effective rate management helps build a successful drayage business. Below are some highlights from the podcast.  You can watch the entire episode here or on your favorite podcasting platform.

On how drayage trucking companies and 3PL providers can stay competitive.

“It’s a competitive market, and everyone’s fighting over what freight crumbs are out there! From a trucker’s perspective, we’ve seen an influx of smaller carriers since COVID… so truckers have to be running lean, agile, and responsive.”

Travis Barnier

In a competitive, post-pandemic market saturated with carriers and 3PLs vying for every load, the only road to success is giving customers a reason to choose you over others. Organizations that streamline operations, enhance agility, and respond effectively to market and customer demands demonstrate better business practices and stand to win more freight shipments. For truckers, this means becoming as lean, agile, and responsive as possible. For 3PLs, competitive strength comes from being accurate, informative, and organized.

In drayage operations, one of the biggest opportunities for optimization for both truckers and 3PLs is effective rate management. It is also one of the most complicated and challenging components of drayage management, as every quote is unique and time-bound based on fuel, accessorials, and surcharges that can change daily. When managed manually, drayage rates require a deep understanding of rate structures, attention to detail, constant updating and supervision, along with hours spent each quoting, back-and-forth phone and email communication, and manual comparison of rate history across various partners.

It is not uncommon for truckers and 3PLs to face challenges in comprehending their own rates and comparing them across partners. With large volumes of data from various sources, using disparate systems and manual spreadsheet tracking is not enough to integrate and manage this critical data effectively. Often this results in errors, inconsistencies, and confusion in rate calculations and quotes. Given the essential nature of a quote before securing any business, and the daily, weekly, and monthly frequency of quoting, drayage companies must have a thorough grasp on rate structures to succeed in negotiations and enhance their marketability. If your business can master this aspect of your operations, not only will you be ahead of the curve operationally, but leading the pack when it comes to your competitors.

On the capability of digital rate management platforms

Digital rate management transforms the way truckers and 3PLs navigate the competitive and ever-evolving landscape of freight transport, both increasing efficiency and saving time from quoting through to invoicing and collecting. It puts accurate and consistent pricing at the fingertips of salespeople across the organization, streamlines prospective customer communications without the back and forth clarifying accessorial charges and capacity to speed up approvals and scheduling.

For truckers, digitally managing rates means:

  • A single source of truth for your tariffs and consistency across the whole organization.
  • Storing and maintain drayage rates for all your services and service territories. 
  • Clean and organized rates that improve record-keeping and allow for easy maintenance.
  • Automated rates, available to customers 24/7, without a live person responding to emails or phone calls.
  • More professional quotes generated with the click of a button that are customizable.
  • Accurate quotes rate that don’t miss additional charges.
  • Responding to RFPs in hours instead of days or weeks.
  • Displaying capacity to partners upfront eliminate availability queries prior to quoting.

For 3PLs, it means:

  • One centralized location for all drayage partners and their associated rates.
  • Easy rate comparisons between partners with all known charges upfront.
  • Standardized quote formats for clear communication and understanding of charges.
  • 24/7 access to rates with one search, rather than emails and phone calls and waiting for a response.
  • Minimized invoice discrepancies through working with carriers that provide timely and accurate quotes with all known charges upfront.

In a fast-paced industry like drayage, timely decisions are critical. Streamlining processes and reducing administrative burdens can be a significant competitive advantage. Digital rate management enhances visibility and transparency of the drayage quoting process, provides real-time lane availability and capacity, and gives stakeholders clear insights into the current needs of their partner network.

How DrayMaster helps businesses meet drayage demands today and down the road

DrayMaster has been assisting trucking companies and 3PLs overcome rate discrepancies, inaccuracies, and inefficiencies for close to 10 years. The platform equips drayage businesses with essential tools to navigate complex quoting challenges, mitigate rate reduction requests, and realize significant cost and time savings. Empowering drayage enterprises with data-driven insights so they can make well-informed decisions, pinpoint areas of improvement, and optimize overall operational performance. Enabling them to expand their operations, whether on a regional or global scale, by efficiently managing increased volumes and increasing supply chain complexities.

Listen to Episode 379: Use Effective Rate Management to Boost Your Business, with DrayMaster for the full conversation.

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