TenderEasy's blog

Over the last few years, I’ve been involved in a number of transport tenders. Most of which had one thing in common – an initial ambition to evaluate a number of different factors. And a final decision to sign with the cheapest possible provider. As soon as analysis is started and a total cost appears, concern for the environment tends to take a back seat, so to say.
 

There is, obviously factors that cannot be ignored. For example, if a shipment needs to reach a factory by a certain time in order for production to proceed, then the right delivery time is obviously a must have service. But many of the non must-have´s are lost along the way.
 
“So what – isn’t cost reduction the end goal of freight tendering?”
Well yes, largely so. But what about the cost of arriving a day later than possible? What about the cost of insufficient information flow?
A neat and often useful way of looking at it is to assign a monetary value to a discrepancy in service level for the services you deem most important.
 
Let’s use lead time as an example, since it’s probably the most commonly used service aspect. What would it cost to arrive later than necessarily possible?
Perhaps it means that a perishable good would lose a day on the store shelf, thus increasing waste. Or maybe it means that more overtime is needed for goods reception. Another way of looking at it is that an earlier planned arrival might mitigate the impact of a delayed delivery. Etc, etc. When weighing all of these factors, you might arrive at the conclusion that an improved lead time is worth EUR 15 per shipment, for example.
 
After that conclusion, it’s easy to produce a total cost analysis where an extra EUR 15 per shipment are added to offers with a longer lead time. Of course, it works both ways. Perhaps you can accept a day’s longer lead time than first considered if that means a cost reduction that outweighs the cost of the delay. By doing this, you will arrive at a total cost analysis for your freight tender, that doesn’t just give you the lowest possible direct freight cost, but one that gives you a simple numerical value as to which provider can offer the best (and cheapest) solution from a combined cost/service perspective. Easy piecy!

About the author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »

Few transports are as demanding in terms of service requirements as end customer parcel deliveries. The progress of e-commerce is constantly putting pressure on the delivery systems to perform to a near 100% satisfaction rate. And as supply chains are continuously improved, lead times are cut shorter and choices in delivery method are expanding.
 
All of this is to be expected, but this last request we got was something else. A little while ago, we received the email below, just look at the demands this guy had:
 
Dear TenderEasy,
 
I write to you as I have started to reach the limits of my capabilities and would like some help to insure that this years’ end-of-year deliveries will meet the standards my clients are used to. And honestly, I’ve been doing this for longer than you can imagine and I’m starting to get a little old and tired, although my ambition and spirit is still there!
 
I’m in the toy manufacturing and delivery business. Of course, as such, my business sees a huge spike in demand around this time of year. In fact, due to the nature of my business, I must handle all of my deliveries within a single day. In total, we’re talking about roughly 550 000 000 overnight parcel deliveries to addresses scattered all over the world.
 
With an average parcel size of 500*300*200mm, that’s roughly equivalent to
25 000 000 SEU:s (Sleigh Equivalent Units), of which everything is to be delivered from my northern production unit.
 
As if this isn’t challenging enough, everything must be delivered to door (or to chimney). My recipients are highly demanding and are known to get very cranky if something is not right with the delivery. So in order to avoid mistakes, I’ve employed a vast network of Delivery-At-Door volunteers - a DAD-network, if you will.
 
My business is very dear to me! I’ve even gone as far as to personally visit each and every one of my recipients throughout the year, in order to make sure that they really get the products they deserve. (Of course, I cannot actually let my customers know that I keep track of them, as that would violate a whole host of privacy laws).
 
Do you think you can help me out?
Yours truly, S. Claus.

 
 
After that, he refused to give us any more information on his business or even who he was! Although, judging by his name, Claus, and his demands on precision and accuracy, I’m assuming he is German…
 
In any case, I think it serves as a good indicator of where the e-commerce parcel delivery market might be heading if it continues its’ current trend.
How would you help solve the problems of Mr. Claus?
 

About he Author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »
Christmas is upon us (soon, anyway), and after that a new year is coming. What’s your new year’s resolution? Don’t have one yet? Well, as always, a new year is a time for new beginnings, so I’ve put together a couple ideas for resolutions (and solutions) that are sure to help you exit 2018 even more enthusiastic than you entered it.
 
- Resolution 1:     
I promise to stop using excel to collect and evaluate offers from my invited service providers.

- Solution 1:         
First off, I’m sorry you’re still stuck in the 90’s. But don’t worry, you’re more than welcome to join one of our webinars, where we will explain in detail our philosophy and how TenderEasy can help you shift focus from time consuming administrative work, validations and analysis to the parts of the tender where you can make the biggest difference – negotiations.
Follow this link to sign up for one of our December webinars.


- Resolution 2:     
I promise to stop wasting time and energy sending multiple emails back and forth to service providers just to get a quote for a spot shipment.
 
- Solution 2:
You’re in luck! It just so happens that TenderEasy is currently offering 90 days usage of the Spot Request tool free of charge, when you sign up in December. Sign up for your free trial today!
Of course, this is just a small saving compared to what you’ll save in time, energy and transport cost… 
 

And by this, I have started working on my own resolution – to make sure as many people as possible stop wasting time, energy and money on useless exercises that doesn’t add any value to their freight tenders. I have a feeling this resolution is going to work out better than my yearly gym membership…
 

About the Author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »

Many of my responsibilities here at TenderEasy are customer centric, be it in the form of trainings, support, sales, etc. As much as I enjoy these encounters, they can be quite time consuming and, from time to time, make it hard to keep up with my other responsibilities – like writing this blog!
 
So, in the spirit of questioning everything, I feel it’s time that I really dug into the foundation of our business (as well as the foundation of the free market economy). Customers – what the heck do we need them for?? Wouldn’t life be much simpler without them? It would no doubt be a lot less stressful in any case. No sales activities, no trainings, no payments to process… We could use all day every day to perfect our tool, safe in the imagined knowledge there is no one who can offer a better or more efficient freight procurement solution. Unless there are others out there who also are sitting alone, developing their tool and basking in their own glory, of course...
Plus, customers often have a habit of multiplying through word of mouth, leaving less and less time to ourselves…
 
Then again, there are some benefits to having a customer or two… For example, a large chunk of improvement ideas seems to originate from existing customers. Needs that we haven’t thought about but that result in improvements and a better tool for everyone.
 
Secondly, our customer base helps us value our ideas and progressions, keep up with market trends and prioritize future developments we want to do. An invaluable source of feedback that we would never get our hands on had we not actively used our customer base as a source of knowledge!
 
Not to mention that pretty much all our customers are really nice people! I mean, nothing negative with my coworkers, but a bit of outside stimulation never hurt.

Oh, and I guess the money is kind of nice too. Food on the table and all that…
 
So to all our customers – know that you are appreciated and thank YOU for placing your trust in US!

About the author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »

For some time now, the two dominating modes of import from China has been Sea and Air. One is a slow moving bulk solution with a low price tag, the other offer fast paced delivery at a premium rate. But there hasn’t really been a good compromise between the two available on the market. But that paradigm is in full change right now, as more and more shippers decide to shift to rail as a relatively fast and eco-friendly alternative to get their goods from China to Europe.
 

For a couple of thousand years, all trade from the Far East to Europe and Africa went via the legendary Silk Road, providing Europeans with silk, spices and other valuables. Of course, ever since the camel was outcompeted by more efficient modes of transport, the overland trade route has lost its relevancy to modern trade.
In recent years however, China has made a push for the reestablishment of a “new silk road”. Multi billion USD investments have been made into a number of infrastructure projects, promoting the possibilities of land based goods transport between Europe and the far east. In all, it includes an excess of 50 rail connections between European and Chinese cities.
 
As this huge project has been set to work, overland volumes have risen significantly and are expected to continue to do so. As an example, a total of almost 500 Europe-bound departures were recorded out of one of Chinas largest rail hubs, Chengdu in 2016 – a number that is expected to be doubled this year. And as the market is growing, all the well known forwarders, such as DB Schenker, DSV and Kuehne + Nagel etc. are starting to offer solutions that take advantage of the emerging possibilities.
 
So – why would you choose rail over sea or air? Well, lead times as well as prices are going to be a compromise between a sea- and an air solution (lead times are reduced by about 50% compared to ocean freight), with the added benefit of it being an environmentally friendly alternative to the two traditional modes. It has also managed to provide a bit of security in uncertain times on the sea carrier market.
 
On the other hand, rail transport has some security issues of it’s own, specifically due to containers having to switch trains, because of differing rail gauges between countries.
 
So weather you are importing silk or smartphones, perhaps you want to spice up your next freight tender with a few rail lanes from China?
 

About the author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn. 

Read full post »

If you’re anything like the majority of freight buyers, you probably tendered your freight contracts on the basis of your business’ situation at the time of tendering. So how long since your company looked over your freight needs? I mean, really looked over. Not just meeting with the current provider to shake hands on the yearly price update.
 
Well, there are a few signs that a freight service review may be due. Apart from the obvious reason – that you haven’t done a review in a long time – there are a few major reasons to:
 
Operational changes within your company
No business is static and there are a lot of factors that may potentially impact your freight contracts and your carrier’s ability to perform up to the standards of what you have agreed. This can include, but is not limited to, any of the following:

  • A significant growth in your business
  • New products or services
  • New market introductions
  • Change in shipped volumes or product mixes

 
Any one of these is a grounds for reevaluating your freight needs, but a combination is almost certain to mean that your current carrier(s) aren’t optimized to your needs.
 
Changes in carrier practice or performance
As a customer, it can be hard to identify specific operational changes at the carrier. There are however a few signs that can be identified in day to day business that might signal a need for a closer examination:

  • Sudden rate increases
  • Declining service levels
  • Changes in rate structure
  • Reduction in capacity
  • Carrier merger or acquisitions
  • Increasing sub-contracting of shipments to third parties
  • Communications being made more difficult
  • New/added freight services (especially important in e-commerce)
 

While specifically the first two may seem obvious, any, or several, of these signs may indicate that your current carrier setup is no longer optimal.
 
 
Changes like these are often slow and impacts might not necessarily be obvious at a glance. But in the end, you don’t want to get stuck conducting your business in a way that’s optimized to a situation that hasn’t been a reality for a long time. So be sure to keep your eyes open – there is a lot to be gained from keeping up with a volatile market place!

About the author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn. 

Read full post »

100 days isn’t really a natural time frame to measure things in, is it? Three months and a few days. 14,3 weeks. Nevertheless, it is commonly used to measure initial progress - famously so in terms of a US President’s ability to live up to ambitious campaign promises. And if it’s good enough for the President, it’s good enough for me! So here are a few takeaways from my first 100(+) days at TenderEasy.
 
Alright, I’ll admit right off the bat that (like a campaign promise) I might have slightly misrepresented my tenure at TenderEasy, as it’s closer to 150 days. Nevertheless, I feel it’s appropriate to share with you some of the insights I’ve gained so far. Like these:
 

  • Wow – there really is a need for a SaaS-freight procurement solution out there!
While many companies have the taken step into the future and started using services like the one we supply, a surprising amount of companies are still stuck in the ways of yesterday, puzzling with excel sheets and comparing incomparable bids sheets.

 

  • No tool alone can rid you of all your freight procurement duties
Buying a solution like TenderEasy will undoubtedly help in simplifying and speeding up the RFQ process. This does not, however, mean that it will replace the fundamental competence of the buyer. A thorough understanding of the supply chain as well as it’s internal and external demands are still paramount to the setup of a successful tender. You need reliable data to maximise the benefits. Unfortunately (for some), the old saying also applies in the digital world…shit in…shit out….  

 

  • We’re not selling a tool – we sell time to focus on what’s important!

As tempting as it can be to dig into the intricacies of the system, the functionalities and technical benefits, what we really sell is time. Time subtracted from setup, bid collection, validation, evaluation and analysis – time that can be used where a skilled buyer can add the real value, like negotiations and contracting with enough time to do it properly!
 

  • We provide benefits not just for our customer

During my first time at TenderEasy, I’ve encountered many happy customers. But in addition to that, I’ve also encountered some happy forwarders. It turns out (unsurprisingly) that it’s not just the buyer that values a structured, easy and, as a result, fair RFQ process.
 
So in conclusion – while it will always be hard to live up to every expectation of the voter customer, my initial experience at TenderEasy have left me strengthened in the belief that what we do is of great benefit to the industry. And not just the buying part, but the entire supply chain.
4 more years!

About the author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »
The shipping industry is a volatile market. Every shipper has to live with its ups and downs – no-shows and roll-overs. Contracts are written for volumes that are hard to accurately predict.
Even so, long term sea freight contracts are a necessity in order to have any sort of stability and reliability for your oversea freights.
 
Now, let’s say your volume forecast in your contract wasn’t great, and you could not commit to your actual volumes. You need to guarantee that your shipments are actually shipped on that vessel that day. What do you do? Apart from crossing your fingers and holding your breath, that is…

 
One potential solution could be the fairly young New York Shipping Exchange (NYSHEX), at least as long as you’re not motivated by price alone. NYSHEX’s business idea is to act as a broker between shippers and carriers, for high-priority shipments. Carriers reserve volumes on vessels that shippers can book to secure that their volumes are shipped. It’s like buying premium tickets for your ocean containers instead of economy class. The “economy class” seats are easily filled and overbooked, but the premium seats can be reserved – sort of like Maersk’s previous “business class” shipping solution. The backside? Well, you’re unlikely to come away from such an arrangement without a significantly lighter wallet. 
 
In the name of simplicity, standard contracts for all carriers are used and all-in prices are offered, without the usual flurry of surcharges that is usually added in order to counter the previously mentioned uncertainties. Importantly, the contracts are fully enforceable with hefty penalties if either party fails to live up to the contracted service. The idea is that as such, performed service levels shall be able to be significantly improved.
 
This is not to say that long term contracts are without merit, they are of course necessary for any type of stability over time, as well as to ensure best possible negotiated prices (whereas NYSHEX will offer standard rates supplied by carriers). And by all accounts, the spot market as we know it will live on as well, due to it’s simplicity and ability to provide market rates for one-off shipments.
 
So NYSHEX cannot serve as a substitute for neither long term contracted rates or the spot market - nor does it aim to – but it can perhaps serve as a compliment for when you want to guarantee a priority shipment. At least it is an interesting proposition. And hey – if NYSHEX helps carriers reduce cost incurred by inefficiencies, perhaps that will benefit your next long term contract negotiation.

About the Author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »

What sets a procurement tool specifically geared towards freight procurement apart from a regular procurement tool? To answer that, I’ve compiled a few of the benefits that might come with using a transport procurement tool: 

1. Specific functionality/templates
Procuring transports can be very different from procuring other goods or services. Certain logics needs to be applied that is not usually applied for other sorts of procurement, such as break point calculations, freight weight conversions and similar logics. 

2. Additional benefits 
Procurement of freight solutions is not all about long term contracts. If you need to pursue additional ad-hoc requests, a procurement solution like TenderEasy has the extra modules to allow for doing this as well. Adding on API and search engine to query your tendered rates, well then, we are talking a complete set of potentials for your organisation. This is something that is not available via a generic procurement tool. 

3. Integration
A procurement tool, while surely useful and necessary, can only take you as far as to the negotiation and signing of contracts. So, when it’s time to implement the procured solution, the ability to integrate with transport specific systems, such as TMS-systems, it is very important to smoothly transition into actually using the new contracts. 

4. Competence
Whenever you run into a situation, you might want to contact support, and there should be skilled freight procurement professionals on the other side. With a tool built by professionals, for professionals, this can be expected and delivered for sure. How about a generic tool, can it solve this need? Will you get the same attention and freight procurement knowledge available when you need it? 


Above points should be kept in mind when researching what solution is right for you and your company. Weather you go for a general procurement tool, or a solution tailor made for transport procurement.

About the author

Johan Vagerstam
Johan is CEO and Co-founder of TenderEasy. He works along with colleagues, partners and clients to transform the way organisations manage their freight procurement processes. You can follow him on twitter and on Linkedin.

Read full post »

Are you still managing your freight tenders with excel? Do you like what you see when browsing our website? Well, in that case I have two things to say to you:

1.     Congratulations! You are well on your way to saving a lot of time, energy and money on your upcoming tender processes!
2.     While a tool will surely lighten your workload, keep in mind that there are still some duties that have to be managed by you as a buyer.

 
The business of transport sourcing has long been neglected in terms of technological progress and tools to aid the process. The vast majority of companies are still using home made excel solutions to prepare, collect and analyze offers. And while there are undoubtedly massive benefits to reap from implementing a more up-to-date solution, please be advised that going digital will not relieve you of all your duties. The following are a few integral part to any tendering process that still demand close attention, no matter how good of a tendering solution is implemented.
 
1.     Preparation (company unique setup)
        No tool can replace a thorough knowledge of the business being tendered and the unique needs that lies therein. A tool can only optimize the input, but if the input is not on par with reality, neither will the output be. So it’s of utmost importance to take the time to do your due diligence on your own company before implementing a tool to optimize that reality.
 
2.     Supplier engagement/communication/trust building
        As we’ve explained in a previous blog post, there are significant benefits to engaging the supplier early in the process. Make sure that all suppliers are on board with the essential characteristics of your tender, we recommend setting up a webinar to explain why your tender deserves their attention and keep that line of communication open throughout the tendering process. This will undoubtedly create more knowledgeable and engaged suppliers - and as a result, higher quality bids in the end.
 
3.     Negotiations
        Although a solution such as TenderEasy’s will help you perform analysis of multiple scanarios and present a number of prefferred suppliers on that basis, such results should not necessarily be taken as gospel. Rather than presenting you with the answer for who to sign with, the time saved and the final output from the tool should be put to use where you as a buyer can really make a difference – in final negotiations.
 
As long as each of the above is allowed it’s proper attention, a tendering solution like TenderEasy will no doubt allow for a lot of time and energy to be saved, while simultaneously ensuring a high quality outcome.

About the Author

Jacob Wiklund is working for TenderEasy as a Sourcing Analyst / Consultant with previous experience as a consultant in supply chain management. He holds an MsC from Chalmers University of Technology. Connect with Jacob on LinkedIn

Read full post »

Recent blog posts

Recent Comments

Archive

Blogroll

Tags