After the challenging transportation environment in 2018, it’s clear that shippers and carriers are dependent on each other for success. But while there’s plenty of discussion about what it means to be a “shipper of choice,” what does it mean to be a “carrier of choice?” What capabilities or attributes elevate some carriers above the rest and make them good partners? Why is it important to recognize these carriers?
Those are the key questions I discussed with Bruce Johnson, VP Capacity Development NA Truckload at C.H. Robinson, during a recent episode of Talking Logistics.
Shipper-Carrier Partnerships
During the tight capacity days of 2018, we talked about what shippers should do to become a shipper of choice. Now that capacity has loosened up a bit and carriers are seeing some softness in demand, it’s fair to ask what carriers might do to become a carrier of choice. Therefore, I began my discussion with Bruce by asking what is important in developing successful shipper-carrier relationships.
Bruce notes that both carriers and shippers are looking for collaborative relationships that are sustainable. “We all know 2018 was a good one for carriers, but they recognize the market is going to ebb and flow,” says Bruce. “Carriers want to build sustainable relationships that support shippers when capacity is tight, but also help meet their needs during other market challenges. It’s all about building relationships for the long term, not just what transactional advantage you can gain for the next six months.”
Carrier of Choice
With the advantage possibly shifting toward shippers currently, I asked Bruce what attributes shippers are looking for that might make a partner a carrier of choice. Bruce says service is still extremely important — picking up and delivering on-time and other standard service functions. But he explains that new capabilities are becoming key as well.
“Visibility is huge for the shipper community,” Bruce states. “People want to know where their goods are within the supply chain. So, track and trace capabilities are critical. And as we mentioned with carriers, shippers also want relationships where carriers don’t take advantage of them when capacity is tight. That’s what a carrier of choice looks like for us.”
Bruce adds, “You notice I didn’t mention rates as a criterion. Although rates are still important, shippers and carriers realize that getting the absolute lowest price isn’t an appropriate way to maintain a long-term relationship.”
Carrier of the Year Awards
C.H. Robinson recently established a Carrier of the Year awards. I asked Bruce why. Bruce says a few years ago they realized it was important to recognize the efforts of their highest-performance carriers. They gave out their first awards three years ago, flying to the carrier locations to present the award and hosting a nice dinner for them. But they felt it was important for the carriers to see C.H. Robinson’s operations and meet their people.
“For the past two years we brought the awarded carriers to our Eden Prairie, Minn. headquarters to show them our facilities, meet with our executives, and even brought in outside speakers,” states Bruce. “We throw a great award event in the evening that everyone wants to attend where our carrier sales reps talk about their experiences working with the carrier. Then the carrier exec gives a speech. It’s a very special event and we feel it’s important that the carriers know how much we appreciate their partnership with us.”
Selecting the Award Winners
So far, C.H. Robinson has honored 12 winners out of a 76,000+ contract carrier base. I asked Bruce how they made these selections. Bruce says they select from their tiered Carrier Advantage Program based on carrier size, type and certain minimum volume requirements. “Then we look at carrier service attributes and automation of visibility as a first cut. We next go to our carrier representatives across our network and ask them to nominate carriers they work with and tell us what sets a particular carrier apart. That’s a critical part of our process, which this year netted hundreds of nominations.
“We have a selection committee that then reviews the nominations based on the criteria to select the top three in each category,” continues Bruce. We then have a somewhat larger group that spends many hours making the final decisions on winners. Ultimately, we’re looking for the right relationships that we can reward.”
Program Benefits
Obviously, not everyone can be an award winner. So I asked Bruce what the benefits are for both carriers and shippers to be part of a process like their Carrier of the Year awards even if they don’t win. For Bruce’s insights on that question and more, I encourage you to watch the full video. Then post a comment and share your own insights and advice on building long-term shipper-carrier relationships.
