The ins and outs of freight management can be rather complicated. Enter digital freight management, which offers maximum satisfaction scores by streamlining end-to-end freight logistics.
The ins and outs of freight management can be rather complicated. Enter digital freight management, which offers maximum satisfaction scores by streamlining end-to-end freight logistics.
The early holiday shopping season is often filled with considerable chaos. According to the National Retail Federation, total holiday spending reached approximately $989 billion in November and December 2023.
Big retailers such as Walmart, Target, and Amazon usually announce their early holiday sales events in advance, underscoring the need for robust supply chain logistics.
Same-day or next-day delivery is often a nightmare for shippers during Black Friday and Cyber Monday (BFCM). Beyond the holiday shopping spree, freight logistics remains a complicated process, which results in significant operational challenges for goods transportation when managed traditionally.
Your freight management processes must always be seamless, not just during the holiday season. As part of supply chain management solutions, you can employ a plethora of modern tools to streamline the nuances of freight logistics processes. Digital freight management complements this objective by ensuring agility and resilience.
Let’s learn how to reshape the logistics supply chain in the digital age.
What is freight management?
Freight management involves end-to-end planning and execution of delivery of goods through streamlined transportation workflows. Outbound and inbound fulfillment is the key objective of robust freight management, which works by aligning shippers and carriers to provide seamless freight logistics.
Implementing digital freight management removes transportation bottlenecks by automating repetitive and mundane workflows such as freight sourcing, rate negotiations, load consolidation, freight audits, and payments.
KPMG highlighted AI-driven smart logistics as a supply chain trend in 2024 for network optimization, sustainability gains, and customer experience. The ability to expedite freight logistics operations can facilitate significant positive business outcomes for you.
Key pillars of successful freight management
Freight logistics entails various procedures that can be digitized and automated efficiently. However, it is essential to identify the key capabilities that are crucial for the success of your global freight management as you consider leveraging a global freight management system.
Route and load optimization may be familiar, but there are several intricate processes involved, which you can digitize using a freight management system. Let’s discover them.
- Route optimization: A robust digital freight management tool helps you uncover the most efficient routes for the transportation of goods using real-time shipping and weather pattern data.
- Predictive analytics: Digital freight management anticipates trends to assess future transportation demands and challenges, aiding in resource optimization and driving efficiency.
- Freight rate management: Keeping rates in check is cumbersome. An automated method streamlines every aspect of contract and freight rate management, from updating rates periodically to monitoring accessorial charges.
- Freight procurement: Digitized freight management streamlines freight procurement by automating request for quotation (RFQ) workflows, enabling you to capture the best deals for both spot and long-term contracts.
- Freight spend management: AI/ML-powered freight management gives you visibility into logistics spending and allows you to better control costs by determining carrier performance.
- Real-time visibility: Manual tracking is prone to errors. Digital freight management provides real-time visibility into multimodal global shipments, enabling the prediction of ETAs and enhancing the response to event-based milestones.
- Load optimization: Dynamic capacity solutions optimize space and use transportation modes based on freight size, shapes, and several other attributes to drive cost efficiency.
- Document management: Digitize multiple processes for freight management, including, bill of lading, invoicing, and regulatory compliance.
- Sustainable logistics: Build environmentally-friendly freight operations by encouraging reverse logistics or efficient route optimization to reduce carbon footprint and save on fuel costs.
Modernizing freight management drives business success by streamlining thousands of manual workflows for cross-functional tasks and subtasks. It saves time and costs while helping businesses focus on improving customer experience at a large scale, which translates into long-term customer advocacy and retention.
Beyond moving goods: Benefits of effective freight management
Digitizing freight management streamlines the oversight of multimodal global logistics, enhancing your business's resilience and agility. This approach provides a competitive advantage, offering significant benefits such as:
- Market expansion: You can foster a data-driven culture in your freight logistics operations, enhancing visibility across global shipments and reducing friction in multichannel carrier partnerships, which can help you expand into new markets.
- Improved customer experiences: AI/ML-powered freight management streamlines shipment execution and facilitates real-time tracking to provide predictive ETAs. This flexibility helps you meet customer demands and elevate their experiences to improve retention and long-term profitability.
- Risk management: Control towers and predictive analytics are key additions to logistics. They can help predict trends and bottlenecks with stakeholders, enabling data-driven decisions and proactive risk prevention to meet SLAs.
Leading businesses across various industries are realizing the significant benefits of digitized freight management.
- Godrej Consumer Products (GPCL) uses Pando Fulfillment Cloud to optimize carrier use, load consolidation, and seamless execution, which helps it meet SLAs.
- SRF Chemicals gained 100% visibility across freight audits and payments and 7% cost savings in overall freight spend with Pando. Using digital control towers, SRF also improved its network performance and carrier relationships.
Preparing supply chains for tomorrow: Modernizing freight management strategy
Transitioning to digital freight management can be challenging for people averse to change management and existing processes. However, it is necessary to embrace the change.
Here are the key questions you should consider for assessing digital readiness.
1. Is your procurement tool freight-specific?
Evaluate this question, as most businesses use generic procurement tools, which result in process inefficiencies. Ensure freight management provides transportation-specific use cases to streamline procurement-based events.
2. Does your existing system offer TMS integration?
Ask if your existing system allows TMS integration with ERPs or CRM systems. A seamless integration helps automate downstream logistics, which is a no-no with traditional systems.
3. Can you leverage market intelligence and benchmarking?
Traditional freight management often lacks the market insights needed to determine rates for the appropriate carrier. Keep an eye out for this feature when integrating freight management systems.
4. How can you optimize empty miles?
Your current tool incurs significant costs due to inefficient backhaul planning. You can plan proactively for reverse logistics and drive freight cost management using AI/ML-powered freight management.
5. How ready are your people?
Your people are accustomed to old processes and might not consider change management a favorable option. Focus on leveraging a collaborative UX so that every stakeholder can use the platform efficiently without friction.
Addressing top challenges in freight management
Staying competitive and driving success with freight forwarding is never easy. However, building robust freight management strategies can help you mitigate these challenges.
- Last-mile delivery issues: AI/ML-powered route optimization can address last-mile delivery challenges during peak holiday seasons, helping eliminate transit issues and ensure compliance with ETAs. Damaged goods are also a part of the problem during transit, which businesses can manage with real-time tracking using control towers.
- Fluctuating costs: Geopolitical tensions, shifting consumer behavior, fuel price fluctuations, capacity constraints, and freight volatility contribute to fluctuations in freight rates. Dynamic rate forecasting utilizes historical and real-time data to adapt to market conditions, enabling better cost control.
- Regulatory compliance: Cross-border shipments with multimodal transportation, including inbound fulfillment, must comply with customs laws and environmental regulations.
However, the evolving regulatory landscape can complicate compliance for freight forwarders, leading to difficulties in support and the risk of penalties. Keep a tab on regulatory changes and implement strategies. Automated freight management provides predictive alerts and keeps you abreast of the changes.
- Logistics risks: Supply chain disruptions are inevitable due to geopolitical tensions, labor unrest, and weather events. Digital control tower dashboards provide a unified view of threats so that shippers and carriers can effectively use warning alerts and mitigate threats.
Role of freight management partners: Enhancing logistics efficiency
It is challenging to drive the digitization of your freight logistics without collaborating with a partner. However, it is essential to partner with an industry leader with significant domain expertise in using advanced tools and technologies to drive real ROI.
Here is how you can transform freight management with a leader in supply chain logistics.
Multimodal shipment management: You can leverage multimodal transportation for air, water, road, and rail in any way you choose, with end-to-end visibility with all your carriers while maintaining SLAs. Leaders such as Pando facilitate 21% of SLA improvement in 94 days by driving process efficiency.
Freight cost management: Tidy up your procure-to-pay lifecycle for transportation logistics with your digital freight management partner. Leveraging AI copilot helps streamline procurement workflows, optimize dispatch plans, and save costs by removing manual interventions. Partnering with Pando, an expert fulfillment cloud partner, can lower costs by 12% in 65 days.
Customer experience management: Real-time tracking through control towers and predictive analytics helps estimate ETAs and prevent threats to your logistics. A best-in-class solution provider in freight management ensures these attributes to offer timely deliveries and elevate the customer experience by 21%.
Sustainability management: AI/ML-powered technologies enhance optimization for fleet capacity consolidation and efficient delivery routes, reducing carbon footprints and helping you achieve sustainability goals within 112 days.
Choosing the right freight management partner: Key considerations
Collaborating with the right freight management partner is essential for avoiding the complexities of managing your fleet. However, several criticalities are involved with onboarding and managing freight management software.
There exists a persistent need to check with your supply chain solution partners to see if they possess industry-best practices and much-needed expertise to push you to success.
You must consider the critical factors mentioned below while choosing the right supply chain solution partners:
Time to value: Select a platform partner that offers no-code workflows, allowing you to set up your business processes quickly without a steep learning curve, resulting in faster ROI.
Industry best templates: Ensure you can remove groundwork for your people and kickstart with pre-populated RFQ templates while automating RFQ processes.
AI/ML innovations: Evaluate the level of AI/ML capabilities that help you automate carrier selection, bid processes, performance monitoring, and freight procurement and payments.
System integration: Ensure seamless integration support with existing business tools such as ERPs and CRMs to access real-time order and customer data, automating procurement workflows for enhanced efficiency.
Scalability: Your platform should scale effortlessly to accommodate increasing procurement scenarios and events.
Dedicated customer success support: Consider selecting a freight management partner that guarantees live support during onboarding and procurement events to prevent downtime and ensure execution.
What’s ahead
According to McKinsey, automation could unlock the full potential of logistics operations, with many businesses planning to automate numerous repetitive tasks by 2030.
It’s time to unlock the immense potential of AI/ML tools while also maximizing the use of various technological capabilities in digital freight management tools to remove inefficiencies and mundane workflows. Digitizing freight management will help you embrace a holistic approach to freight logistics, improve end-to-end operations, and drive tangible benefits for your business.
Pando brings its domain expertise in supply chain solutions across inbound and outbound fulfillment to eliminate freight-related complexities and improve user experience. Book a demo with Pando today to digitize your freight management.
