If you have anything to do with managing global freight rates for a freight forwarder, you’ll know that managing rates for accurate quote-building is like juggling a complex puzzle. Every piece – BSAs, contracts, spot rates – is a different type and, of course, those pieces change shapes in real time. In fact, a typical door-to-door quote can involve managing and reconciling 10 to 20 different fees and surcharges, each with its own set of variables. And forwarders don’t do this once – they build and rebuild these complex quotes dozens of times a day.
And as if that wasn’t challenging enough, the rapid adoption and growth of digitized cargo rates, online quoting, and booking platforms have introduced yet another rate type into the mix: dynamic spot rates based on live capacity and market conditions, updated and communicated in real time.
But, this evolution, though adding complexity, represents a significant opportunity for forwarders.
The Dynamic Dance of Freight Rates
Traditional Rate Types
Traditional rate management involved:
Long-term BSAs: Fixed-capacity agreements over an extended period, ensuring consistent pricing and space, regardless of market fluctuations.
Contract rates: Pre-negotiated shipping rates locked in for a specific period, offering stability and predictability.
Tariffs: Official charges or taxes imposed on goods during transit, often varying by region and type of cargo.
Promotional rates: Temporary discounted rates designed to attract customers during specific periods or to fill unused capacity.
Spot rates: On-the-fly pricing based on current market demand, often higher but flexible and immediate.
These static rates were updated infrequently or manually, requiring forwarders to navigate a labyrinth of pricing structures.
Rise of Dynamic, Digitally Driven Rates
Enter dynamic spot rates – these rates change in real time, responding to market demand, available capacity, and other factors. Digitally updated, dynamic rates offer forwarders unprecedented visibility – in terms of available rates and underlying space – and actionability – in terms of being bookable. More on that soon.
This is far from just forward-looking digital mumbo jumbo. Here’s the real-life impact via David Wystrach from Scan Logistics (text highlights added):
Information availability is what matters most. [With Dynamic rates] airlines honor the capacity granted with the rate, so capacity access is the other big advantage, and it can be instantly confirmed by or while on the phone with a customer is another big benefit. It lets you support the customer by knowing which best options are available via access to that information.
As a result of increased digital distribution capabilities, carriers can now update prices frequently or even programmatically, in real-time, and communicate these changes instantly to forwarders via API or through their digital sales portals or eBooking platforms like WebCargo.
Taking advantage of all of this requires a shift in a forwarders’ approach to freight rate management though.
Digital Alchemy: Turning Freight Rate Data into Gold
Visibility Revolution
Digital platforms bring together the complexity for forwarders, offering a panoramic view of all rate types. The integration of rate management technology with eBooking and market intelligence platforms means not only better, side-by-side visibility of all rate types but also unprecedented actionability.
Actionability Enhancement
Best-in-class tools can also change how forwarders handle quoting by enabling them to generate, customize, and send quotes to customers with unprecedented speed and accuracy.
Digital quoting isn’t new but to do so comprehensively is. Modern quoting must include every detail – things like account-specific pricing, comprehensive origin and destination surcharges, and terms and conditions – as well as a branded, well-formulated quote. Gone are the days of static, outdated quotes. Now, rates can stay dynamic within a sent quote, ensuring they always reflect the true market conditions. This keeps forwarders one step ahead, offering their customers the most accurate and competitive rates at any moment.
Customizable and Automated Quote Generation
Since dynamic rates are, well, dynamic, quotes must adapt as well.
Imagine automatically generating quotes based on real-time data. These quotes can be customized to meet specific customer needs or market conditions, making them not only accurate but also tailored for higher acceptance and customer satisfaction. No more manual tweaks or outdated info – just smart, efficient quoting.
Dynamic Rates Within Quotes
Keeping rates dynamic within a sent quote offers customers the most accurate and competitive rates. This keeps forwarders agile, allowing them to adapt instantly to volatile markets by ensuring prices stay true to the latest market conditions.
Here’s how it works:
When sending a quote to a customer, it’s more than just a static document. The quote includes real-time rates that automatically update with the latest market changes, all while maintaining the forwarder’s pre-set margin.
Customers can then choose the option that best suits their needs.
Once they’ve selected their preferred rate, they can lock it in and book the shipment directly through the same interface. No back-and-forth. No waiting. Just instant, accurate pricing that drives a 20x improvement in quoting/booking time.
Managed Access and Permissions
Modern freight rate management should empower your entire network – including agents and overseas offices – by providing managed access and permissions for rate queries and eBookings within the platform. Whether it’s customers, overseas offices, or agents, gone are back-and-forth emails and manual updates. Everyone can view and act upon the most current rate information, with built-in, account-specific margins, making the quoting and booking process smoother, faster, and more efficient.
Integration with Digital Platforms
Leveraging digital sales portals and eBooking platforms like WebCargo boosts actionability to new heights. Rates are distributed digitally, updates are instant and accurate, and multiple rate types are handled simultaneously. These can then be integrated by API to other platforms, whether it’s a sales portal, customer ERP, TMS, or external platform.It’s a unified, comprehensive approach to rate management that keeps forwarders at the forefront of the industry.
Enhanced Customer Experience: Making Every Quote Count
Quotes aren’t just static numbers on a page anymore.
By embedding real-time market conditions into every quote, forwarders transform the routine process into a customer-centric experience. It’s about more than just providing options that let you stay competitive. It’s about building the quotes around the customer by anticipating the need for agility, and then making the quoting process as fluid and responsive as the markets themselves, giving customers the flexibility and confidence they need to make swift, informed decisions.
Discover the Future of Rate Management, Quoting, and Booking with Digitized Rates in WebCargo’s Latest Report
Case in Point
Sergio Escobar explains what this actionable data actually looks like from the forwarder perspective:
WebCargo can be as flexible as you want. It can be the greatest rate management and contract management tool, but also it could be a fantastic QMS…plus now an incredible advanced technology in terms of eBooking [that enables] a different type of product – we’re not just sending a quote in a PDF, we’re offering a customer an experience, with options.
These tools transform quoting into a dynamic, efficient, and customer-centric process. Forwarders can now leap ahead in a competitive market, driving success with every quote they send.
Digital Symphony
Orchestrating seamless interactions with carriers and shippers through real-time bookings is now a reality. For many rate types, bookings can be placed digitally and instantly within the platform, making pricing data more visible, manageable, and actionable than ever.
The Bottom Line
Digitalization isn’t just about keeping up – it’s about leaping ahead. Leverage the new hybrid rate reality to your benefit and unlock new potentials in rate management, quoting, and booking.
