Contract Rates in a Dynamic Market: What You Need to Know

How long has it been since you revisited your RFPs?

This is a great question for shippers to answer when looking for a transportation partner. The truth is that right now, the market is incredibly dynamic while routing guides are static.

So what does this mean for shippers?

Capacity has been pretty tight so far in 2018 which has created a carrier’s market with rates rising steadily over the course of the year.  And while those rates have fallen slightly during the latter weeks of July which is a seasonal trend, they are still “sky high” according to DAT.

When the market is volatile, as it has been this year, your pre-negotiated rate may be quite a bit lower than the prevailing rate, and this means that your primary carrier may start rejecting your loads for more profitable hauls.

You know how this works. Once your primary carrier rejects your shipment, you start contacting backup carriers. In a tight market, you’re lucky if you can secure a carrier. And each rejection you receive means that you’ve lost more valuable time to the effort. The longer it takes, the more money you spend to ensure on-time delivery of your product and reduce the prospect of failure. If you can…

What You Need Is Flexibility!

But the old way of thinking doesn’t take flexibility into account. That’s why it’s important to revisit those routing guides and those pre-negotiated rates. The most enlightened shippers will partner with a third-party logistics provider who reviews and revisits rates every day, giving them the flexibility and choice they deserve.

At AM Transport, that’s what we do. We get to know you and your logistics priorities, so we can provide the information you need to make the best decisions for your company. Our exemplary core carrier base enables us to offer both flexibility and real-time pricing, so your load gets booked every time at a price you can afford.

Don’t let contract rates get you down, give the experts at AMT a call. We help customers deliver products on-time with consistent, reliable service. Every day!