Is Brokerage Freight a Viable Way to Cut Costs?

Is Brokerage Freight a Viable Way to Cut Costs? (Cont.)

 

How Does Brokerage Freight Save Shippers Money?

Freight brokers have strong networks of carriers with whom they have good relationships. They have experience working with their carriers. They’ve already vetted them and put them to the test, meaning shippers wind up with a more reliable carrier. A carrier who does a poor job can cost you big time. Maybe they don’t have the appropriate certifications to haul your freight, or maybe they’re just never on time. These bobbles can cost you time, money, and your reputation.

Shippers also spend a lot of time and energy handling the tasks a freight broker could be handling for them. They spend extra money on the software to manage your loads, and they spend time comparing quotes that can be confusing, keeping in touch with the carrier, keeping up with all the regulations, and handling all the paperwork that comes with moving freight from one place to another.

Now, back to that software. Freight brokers are well-equipped to handle the in’s and out’s of moving loads. Because it’s all they do, their software tends to be cutting-edge and very effective. You could procure software on your own, but it could cost you dearly.

There’s another boon to utilizing a freight broker’s connections: more power when capacity is tight. Capacity is tight right now, and that doesn’t look to be an industry condition that will be remedied any time soon. A broker may be better able to get a load covered under a time crunch.

How Do Freight Brokers Get Better Deals?

Freight brokers leverage their network of carriers and/or drivers when they work exclusively with one carrier to find the best deal available. They’ve got a little more wiggle room, a little more bargaining power since they dole out loads from several shippers. A carrier may be willing to accept a lower rate from a broker they work with frequently than they would a shipper who simply needs to haul a few loads a month.

Simply put, freight broker’s volume and relationships give them an edge when it comes to quotes and load management. If you are a shipper looking for help finding and managing carriers, BlueGrace, with their top-of-the-line technology, is here to help.

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Independent research shows that improved supply chain management can yield:

• 25 – 50% reduction in total supply chain costs
• 25 – 60% reduction in inventory holding
• 25 – 80% increase in forecast accuracy
• 30 – 50% improvement in order-fulfillment cycle time
• 20% increase in after-tax free cash flows