The rising rate of freight quote requests

As even small companies are running global supply chains, the demand for international shipping services has surged over the past 5 years. These companies are also getting more sophisticated as there has been a dramatic increase in multi-sourcing freight forwarding services. As a result, freight forwarders often find themselves inundated with quote requests pouring into their inboxes. In this blog post, we'll delve into the reasons why freight forwarders receive such a high volume of quote requests in email and explore how they can manage this influx effectively. We'll also highlight the biggest driver of email quote win rates and how even a modest improvement can significantly impact revenue.

What are freight quoting requests?

When a company or individual needs to move cargo domestically or internationally, they often seek the services of a freight forwarder to handle the transportation of the shipment. A freight quote request is a formal inquiry made by a person or company to a freight forwarder, to obtain information about the cost and logistical information of transporting goods from one location to another. 

The global economy at work

The rapid expansion of e-commerce, international trade agreements, and the globalization of supply chains have created a booming consumer goods market and thus a booming market for freight forwarders. Businesses of all sizes, from startups to multinational corporations, rely on their expertise to facilitate the movement of goods across borders. But while the number of revenue opportunities have increased, competition has also increased and managing quote request response times has become more and more challenging.

Reasons for the influx in freight quote requests

1. Market Expansion: As businesses expand their operations internationally, they require reliable logistics partners to navigate the complexities of international shipping. 

2. Diverse Cargo Types: The diversity of cargo types generates a multitude of unique requests, each requiring a tailored quote.

3. Competitive Pricing: In a competitive market, businesses are constantly seeking the best shipping rates to optimize their supply chain costs. This drives them to solicit multiple quotes, adding to the burden on freight forwarders.

Further freight challenges created by BCOs

The surge in quote requests is further exacerbated by certain challenges faced by freight forwarders:

1. Diverse Quote Formats: Many Beneficial Cargo Owners (BCOs) prefer sending out quotes in their own formats. This diversity in quote formats can complicate the process for freight forwarders, who must adapt to various templates and structures and can spend hours a day just key entering data into other systems.

2. Costly EDI Systems: Electronic Data Interchange (EDI) systems are commonly used in the shipping industry to facilitate data exchange between businesses. However, implementing and maintaining EDI systems can be costly, making the technology footprint more obsolete as time goes by.

How to turn this challenge into an opportunity

It's essential to recognize that even a modest improvement in the win rate can have a significant impact on a freight forwarder's revenue. Studies have shown that a 10% improvement in the win rate can equate to an 8% increase in revenue. This underscores the importance of effective quote request management and the potential for substantial financial gains.

Philip Blumental, the CTO of ECU Worldwide, notes, "In the freight forwarding industry, it's not uncommon to have a high volume of quote requests flooding our inboxes. In fact, at ECU Worldwide, we've found that approximately 83% of the quote requests we receive are in our inbox."

Furthermore, Christian Van Eeden, VP of Transportation at Hellmann Worldwide reports, "We've found that responding quickly to quote requests is crucial. In fact, when we are the first to respond to a quote request we over 50% of the time."

How freight forwarding software can bring clarity to the quote request barrage 

Always be the first to respond

As the amount of quote requests continues to grow, freight forwarding technology can help freight forwarders find the most relevant quote requests as quickly as possible. Using automation and AI, you can extract data from quote request emails and create a standard view displaying information like origin, quantity, destination and incoterms. To make this filtered view even more powerful, using integrations with external pricing systems, you’re able to pull freight rates for those quotes right alongside the original email. 

Optimise your freight forwarding inbox

Adopting a freight forwarding communication software built for collaboration allows you to  share rate requests with internal offices where they can input origin/destination specific rates. Complete control of your inbox and filtered views allows you to respond to customers with a full rate request with 1 click. All of this is only beneficial if you can see a material improvement in how your team is responding to receiving the masses of quote requests. Using deep analytics on response time and rates, you can see exactly where you need to improve to become more profitable.

Conclusion:

Freight forwarders play a crucial role in the global supply chain, connecting businesses and markets worldwide, however, the surge in international trade has resulted in a steady flow of quote requests flooding their inboxes. With the right strategies and technology in place, freight forwarders efficiently manage this influx, ensuring that businesses continue to benefit from their expertise in navigating the complex world of international logistics. As the global economy continues to evolve, the demand for their services is likely to remain robust, making effective quote request management all the more critical for their success, especially in the face of diverse quote formats and the costliness of EDI systems. Moreover, the potential for revenue growth through improved win rates emphasizes the significance of continuously optimizing their quote request handling processes.