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Journal of Commerce: “US shippers rethink truck contract pricing”

January 31, 2017

US shippers rethink truck contract pricing

US shippers racing to lock in truckload rates for 2017 in the first quarter are considering changes in how they approach pricing and contracting with their trucking partners. Some are taking an aggressive stance, while others try a more cooperative tack.

More shippers are putting more of their business out to bid to multiple carriers, rather than going through extensive one-on-one negotiations with individual carriers, said executives at Transplace and Spend Management Experts, two companies which handle bids for shipper clients.

They’re also doing so more frequently. That’s affecting how carriers position their assets to build freight lane density, as well as shipper distribution patterns, said Brian Broadhurst, vice president of transportation solutions at Atlanta-based Spend Management Experts.

“Carrier networks are changing more quickly than they used to,” Broadhurst said, as assets are redeployed and dedicated to new customers. “It’s getting hard to know which carriers are optimal for certain lanes because carrier networks are changing so rapidly too,” he said.

That’s making already complex supply chains more complex and posing tough decisions for shippers and motor carriers sitting down at the negotiating table. After enjoying extreme pricing power in 2016, shippers have entered an unsettled period.

Read more here.