Area of Improvement #1: Receiving Orders
What’s that Ferris Bueller quote? “Life moves pretty fast; if you don’t stop and look around once in a while, you could miss it.” We know how easy it is for freight brokers to become overwhelmed by quotes flooding their email box. It’s important to make sure your reps slow down and understand that there’s a customer behind every order. That customer has a value, as a person you’ve built (and want to maintain) a business relationship with. They also have a value in terms of dollars and cents. Each customer represents a lifetime value of revenue for the company, and an acquisition cost.
In addition, customers have service expectations. They don’t want to wait. Every minute they wait to hear from you is a moment they consider going somewhere else. This is true even for long-term customers with strong business relationships.
It can be a significant red flag for a shipper if a rep is difficult to reach or unresponsive to calls or emails. They see it as a sign that the rep is unreliable or doesn’t have the capacity to take their business.
Yes, speed is often more important to shippers than cost. But that doesn’t mean the relationship isn’t equally as important.
Every load order represents dollars in the bank. Yet, many reps don’t have a standard process for receiving and responding to orders.
The Eight Areas of Improvement
Receiving and responding to orders is one of eight (8) common areas of improvement in the freight broker process. Each of these areas are tasks or processes that, when not optimized, cause bottlenecks or pain points for both freight brokers and their customers. In addition, bottlenecks in one area often cause inefficiencies in others. These compounded inefficiencies often reduce your bottom line by eating at your margins.
This blog will focus on studying your process for receiving orders and the typical inefficiencies and pain points that arise there. The goals are to help you uncover wasted resources during this step, including extra labor hours, inefficient tools and software, and other expenses, and to identify ways to optimize the process to be faster and more efficient.
Evaluating How You Receive Quotes
When evaluating any area of improvement, there are several crucial questions to ask yourself and your team. These questions will uncover areas for process improvement, time and resource expense savings, and gaps in necessary tools. These questions may also identify ideas for optimizing or scaling the quoting process.
Let’s dive deeper into studying the process of receiving orders.
Receiving Orders Via Email
Shippers utilize freight brokers to connect with the best carriers, find the most optimal rates, and facilitate seamless deliveries. So, it’s ironic that many freight brokers struggle with daily inefficiencies, like receiving orders through email. While email may seem like an instantaneous way to handle orders, overflowing inboxes, emails that get lost in spam filters, or spotty email servers can cause that 30-second email a shipper wrote and sent to become an hour-long (or even days-long) wait for an answer.
Understanding how long it takes your reps to open and respond to an email order is essential. If you don’t know, time them from the minute they receive an email to when they respond to the customer. Make sure to include time spent manually entering information into TMS. Record the times and calculate your labor cost for each representative. In addition, measure each team member’s capacity for opening and entering orders. Try to find that breaking point where emails go unanswered for an unacceptable amount of time or orders are lost. This information will assist you in knowing when to add reps to your team or change to a more automated process.
Receiving Orders Through an EDI
You’re most likely using an EDI to boost your team’s productivity and revenue. However, many EDIs are prone to connection failures and are maintained by third-party vendors, who may not be reliable. Track how often you experience transmission failures and how much time your team spends troubleshooting issues instead of processing orders. In addition, setting up EDI connections with new clients can cause delays and lost loads when not done correctly. There is also the issue of scalability. Can your EDI keep up with your business growth trajectory? If your team is constantly trying to “work around” your EDI, it’s not helping your bottom line, it’s eating at it.
Recording All Orders
While it may seem like time-consuming and tedious, recording complete load information for all orders (lost and won) in TMS or a database is a “must-do”. This is critical data that can help your team accurately measure win rates and lost loads, recognize customer preferences and behavior trends, and make informed decisions. Maintaining a comprehensive record of load information allows your team to fine-tune strategies for future success. This step should not be short-cutted.
Data on lost orders can help your team identify operational strengths and weaknesses in the quoting process. For instance, identifying lost shipments due to EDI connection issues can show you that you need a new way to receive orders. Armed with this data, you can implement targeted strategies to streamline your receiving process, increasing your chances of winning future loads. Data is key to success in the short term and future scalability.
There are software solutions or TMS bulk import capabilities that can streamline your workflow by automating and recording the receiving process. Once you’ve analyzed your order receiving process and have an idea where your bottlenecks and inefficiencies are, evaluate whether or not one of the available solutions will help you overcome them. Keep in mind that these solutions are an added expense in labor time and in subscription or purchase cost. Additionally, consider factors such as scalability, integration with existing systems, and user-friendliness to ensure maximum efficiency and return on investment.
In a competitive marketplace, receiving orders should not be a bottleneck for your booking process. Your team must accept, acknowledge, and respond to each order as quickly as possible. Otherwise, you risk losing good customers to other, more efficient brokers.
In our next blog, we’ll focus on the second area of improvement, which often slows down responding to orders even further. Stay tuned to read more about optimizing the quoting process.
