At the end of the day, all we want from our final mile carriers is lower costs and better service.
However, those two factors are largely dependent on how you decide to communicate electronically with your carriers. While some methods may seem easier at first, they may have long term drawbacks that can drive up your costs and impact your service.
Communicating with Carriers
Choosing how you’re going to electronically communicate with your carriers is crucial to the success of your final mile. As the shipper, there are several ways you can mandate information be sent and received between you and your carriers:
- Portal/Web-entry Systems: In this instance, you provide the carrier a system outside their current operational system to enter in order information. Because this requires the carrier to leave their system and enter data into a new one, this is typically done at the end of the day and not real-time.
- Mobile Application: You can also provide your carriers an app. This app is typically kept on driver devices, allowing you to send orders straight to the driver, skipping the carrier’s dispatching system.
- Mandating an Operational System: You can tell a carrier that he has to use and pay for a system that you select. Again, this would require they update and submit information in a system outside their typical operations.
- Integrating to the Carrier’s Operational System: By communicating with their current operational system, you allow your carriers to maintain your account within their current operational flows and have access to real time updates.
The Hidden Cost of Communication
Any time your requirements cause a carrier to increase operational cost, those costs will be embedded in their bill back to you, raising your costs.
While they may not be immediately apparent when you’re selecting a communication method, these hidden costs can add up quickly, unnecessarily increasing your final mile expenses.
To keep your costs down, avoid mandating communication methods that require:
- A carrier to leave their usual/current operational system. These systems are integral to the workflows and efficiency of their company. The carrier may not be accustomed to the new system or portal, increasing the time tasks take.
- Double-entry of information. If a carrier is having to enter order or invoice information to you and into their system, the inefficiency will increase their operational cost.
- Delays in data. If a carrier has to leave their system, or wait for a driver to return with information before they can enter your data, you will not be receiving data in real time. Manual entry may also lead to errors in the information sent.
- Segmented views of their business. If a carrier has to go to multiple places for information, they’re lacking one complete view of their business, leading to higher operational costs.
As one of our Carrier Partners* put it, “We currently use at least 4 portals plus our software. If they were integrated it would save a lot of time.”
Cost savings can be found when you integrate directly into the carrier’s existing operational system. This allows them to have one consolidated view of all data, report statuses in real time, optimize driver routes for efficiency, and remove the risk of manual entry.
Communication Impacts on Service
To the delivery recipient, your final mile carrier represents you. Order delays, incomplete tracking, exceptions, and damaged items should all be reported in real time, so you can properly address them with your customer.
Though, if you’ve mandated an additional method such as a portal for your carrier to use, they are likely waiting until the end of the day to input your order information. This results in many crucial details and you miss the timeliness of the data.
Carrier’s efficiency and ability to provide service can also be negatively impacted when mandating use of an operational system. By segmenting a driver’s route in multiple shipper-mandated systems, the carrier can no longer consolidate into a singular view for planning and monitoring — compromising efficiency and causing unexpected service issues.
Details such as GPS coordinates where the delivery was made, the time the delivery was made, and box damage information, can’t be recreated or are hard to remember after several hours. If details are delayed, your data will be inaccurate, and it’s impossible to make data-driven decisions with inaccurate data.
If your data is being passed back to a consumer for tracking, they will not know when their package has been delivered, resulting in post-delivery damage from weather or stolen packages. In addition to costing you, these situations lead to frustrated customers who are unlikely to return.
By integrating with your carrier’s current operational system, you can ensure compliance, real time information and status updates about your order.
Consider Your Relationship with the Carrier
While mandating a communication method with your carriers may not result in them rejecting your business. It will increase the cost of doing business in the final mile and impact your service.
By utilizing a direct integration, you can open up lines of communication with your carriers, allowing them to provide the information you require in real time, without increasing the operational burden.
It’s time to move towards integrating with your carriers’ systems. Getting the best from your final mile carriers depends on it.
The eTrac team has decades of experience in working with final mile carriers and their operations. We utilize this wealth of knowledge to assist our 3PL’s and shippers build and grow their final mile, including helping them:
- Build their delivery network
- Integrate through a single point of integration
- View all their final mile data in a reporting dashboard
It’s time to say “Goodbye” to mandating inefficient and costly communication methods to your carriers. Let’s show you what eTrac can do. Schedule a demo here.
*Thank you to David Metzger with Jet X Delivery, Mark Lucas with Corporate Couriers & Logistics, and all carriers who submitted feedback on portals and web entry systems. All respondents are members of the eTrac Carrier Partner Program. Contact us for more information on this program, and how it can help you grow your network of final mile carriers.