The Urgent Need to Become a “Customer of Choice” in Logistics – More on the Accenture Spend Trends Q3 2014

In joint category research we conducted in the past with the Procurian team (now part of Accenture), I’ve found the logistics sourcing team to have an uncanny grasp of the market (see related links at the end of this post). The group is almost a hybrid of category intelligence professionals and sourcing experts. The Q3 2014 Accenture Spend Trends Report shares a number of other observations from the Accenture logistics sourcing team including the need for customers to avoid being fired by carriers!

FREE Research: Strategies to Drive Savings Implementation

The authors note that despite only moderate GDP growth, supply constraints continue to challenge the logistics market. Specifically, “Utilization rates are high, and driver recruitment continues to be a challenge for carriers. Drivers’ wages are on the rise, and more carriers look set to increase driver pay in order to attract and retain the labor they need.”

The result is a “confluence of trends [that] creates a scenario where over-the-road freight is a seller’s market, and carriers are in the enviable state of having all the demand that they need. As a result, we’ve seen some carriers ‘fire’ certain customers – or at least charge premium rates to ‘more challenging’ customers.”

But how can shippers avoid being fired? Accenture suggests:

“It’s worth asking the question: ‘How difficult am I to do business with,’ and use the answer to motivate better efficiency and collaboration, both internally and with key shipping partners. ‘Hard to do business with’ relates mostly to data and collaboration, i.e., a shipper with inaccurate forecast data, poor processes for communicating about demand, lots of expediting, and so on. Establishing better collaboration and improving data quality can not only improve internal efficiency, but can help avoid incurring avoidable costs, or worse, major customer service issues.”

In other words, if you don’t forecast properly and do the basics when it comes to logistics (LTL, truckload, ocean, air, small parcel, etc.) category management, then you’re at risk for not just spending above market, but actually losing preferred logistics partners.

Share on Procurious

Discuss this:

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.