The near-strike between the Teamsters and UPS left shippers on edge. Once it resolved, a collective sigh of relief echoed through the industry. Yet, as the dust settled, it became clear how closely businesses dependent on a single carrier teeter on the brink. This incident hammered home a vital lesson: diversify your carriers or risk the consequences. The smallest surprise can throw global supply chains into chaos in today's interconnected world. How many more times do we need to learn this lesson? Supply chain resilience isn't mere industry talk—it defines the boundary between success and failure.
Carrier diversification is the way forward. Shippers can bolster their defenses against unforeseen disruptions by looking beyond industry giants like UPS and expanding their carrier network, both in size and scope. Diversifying not only dilutes the risk but also ensures timely deliveries, irrespective of challenges. The following article will explain why.
Modern logistics presents a challenge of single-carrier dependency. Carrier diversification solves this problem by using multiple shipping providers, boosting supply chain resilience and adaptability. Let's explore further.
The global transportation sector is evolving in several exciting ways, from cutting-edge technologies to a heightened emphasis on sustainability. However, in such a changing environment, shippers confront multiple challenges:
Given the complexities we just highlighted, diversifying carriers emerges as a proactive response. Instead of leaning on a singular shipping provider, businesses now recognize the multiple advantages of spreading their logistics network. By utilizing an assortment of carriers, shippers tap into flexibility, achieve improved service levels, optimize costs, and diminish risks, ensuring both market reach expansion and heightened customer satisfaction.
Relying solely on one carrier in the unpredictable world of supply chains is a risky game. Take February 2021, for instance: fierce winter storms threw FedEx's Memphis headquarters into disarray, leading to extensive delivery delays for companies dependent on them- sometimes for weeks. If these carriers had broader networks, including regional options, they could've had a buffer against such disruptions. And remember, these were just weather-related delays; imagine the graver consequences had the potential UPS strike gone through.
The right shipping strategy can make or break your supply chain in a turbulent logistics industry. Here's why carrier diversification can be such a game-changer:
Relying too heavily on one carrier makes you more vulnerable to unexpected disruptions. Spreading your shipments across multiple carriers reduces these risks. Plus, advanced multi-carrier tools make switching to another provider easy if one faces issues, keeping your goods moving without a hitch.
Beyond risk aversion, diversification offers shippers the luxury of choice. With access to a pool of carriers, each boasting unique strengths and specialties, shippers can cherry-pick the ideal fit for every shipment. Not only does this guarantee timely deliveries in prime condition, but it also provides an opportunity for continuous performance assessment, ensuring carriers uphold their service commitments.
Diversification presents a panoramic view of the competitive landscape, allowing for keen comparisons of rates across carriers. With each carrier offering unique pricing structures and potential discounts, a diversified approach sparks competition. Such an environment equips shippers to negotiate superior rates and unparalleled services.
Embracing carrier diversification requires a systematic strategy. Consider the following steps as a brief roadmap:
First, closely examine your current carrier relationships to understand their pros and cons. Identify where you rely too much and look for any gaps in service. However, consider that not having consistent carrier data can make this evaluation less accurate.
Next, list what you expect from your carriers, focusing on their range, affordability, and trustworthiness. Match these needs with your business goals and what your customers want. Technology can also help you better understand various carriers, making your choice easier.
The last step is to research new carriers, always considering your criteria. This stage isn't just about adding more carriers but improving and optimizing your logistics network. An advanced logistics network optimization tool can help you understand your shipping costs better, giving you a clearer view and a stronger market position.
Diversifying carriers is a proactive response to supply chain disruptions. Here's how experts with advanced transportation technology can assist:
Supply chain disruptions are an increasing reality whether we like it or not. The recent Teamsters and UPS labor dispute only confirmed this, making the need for businesses to reevaluate single-carrier dependency more pressing. Carrier diversification is no longer just a strategy but a safeguard against unpredictable disruptions and a means for survival.
As this need grows, expert guidance becomes invaluable. Intelligent Audit stands at the forefront, offering specialized solutions. With services ranging from freight audit software to real-time visibility, they assist shippers in cultivating a balanced, resilient carrier portfolio, ensuring that businesses are ready for whatever comes their way.
Ready to strengthen your shipping strategy? Get started with Intelligent Audit today.
Set up a call with one of our experts to discuss how Intelligent Audit can help your business uncover opportunities for cost reduction and supply chain improvements through automated freight audit and recovery, business intelligence and analytics, contract optimization, and more.
Strategic positioning for the 2021 peak season begins and ends with data. Learn why and five things to know about it today.
A comprehensive freight audit can help companies recapture excess freight spend and conserve resources. Learn more now.