How Freight Benchmarking Can Cut Your Shipping Costs

Whether your company is a big or small player in terms of shipping volumes, and regardless of your chosen transportation modes (road, rail, ocean, air), the health of your bottom line depends in no small part on the competitiveness of your ocean freight prices.

As you will know, though, if you are active in freight and shipping management, your freight prices depend on many variables. So, how can you be sure you’re getting the best freight rates possible? The answer is to benchmark your freight, of course.

At Logistics Bureau, we want to help you with that, so we’re publishing this brief guide to help you if you haven’t already included freight benchmarking in your management strategies or want to benchmark more effectively than you are now. In addition, it will imbue you with some knowledge about best practices—and the secrets to ocean freight-benchmarking success.

Key Triggers for Freight Review

Before diving into benchmarking specifics, it’s crucial to understand the key triggers that necessitate a freight review. From our experience working with shippers, these are the critical signs:

Service Performance Issues

• On-time delivery rates falling below 95%
• Consistent cargo delays at key transfer points
• Rising detention and demurrage costs
• Frequent load rejections during peak periods

Technology Gaps

• No API connectivity with your TMS
• Manual track-and-trace processes
• Inability to provide real-time container visibility
• Poor EDI compliance rates

Business Evolution

• Volume increases exceeding 20% year-over-year
• New DC locations or market expansion
• Shift to omnichannel fulfillment requirements
• Changes in shipping density or cargo mix

Market Indicators

• Rate volatility in key lanes
• Carrier network changes affecting your routes
• New ESG reporting requirements
• Fuel surcharge structure changes

Industry best practice is quarterly carrier scorecarding with comprehensive annual reviews. This cadence allows you to catch issues early while maintaining enough data for meaningful benchmarking.

What is Freight Benchmarking?

There’s no dark art to freight benchmarking. Indeed, it’s a very straightforward concept. It simply means checking your company’s rates paid for freight transportation against those borne by its peers in the same or similar industries and shipping scenarios.

Freight benchmarking services ar…

CONTINUE READING THE ARTICLE FROM Supply Chain 247 HERE