In March I started working with a medium sized brokerage. There was an emphasis on growing their business in the dry van space. A piece of that strategy was to focus on RFPs Anyone who participates in RFPs/RFQs knows it’s a long-term strategy. Here are some results from the engagement · 7000 lanes analyzed between 12 bids in a 3 month period · Between 70-80 lanes won between 1st, 2nd, or 3rd place · The company’s margin targets were between 8-20% · They won an estimated Spend of 1.5MM Most people know it’s hard to win, but don’t know how much patience, diligence, and persistence it takes. If done correctly, it can change the trajectory of your company. #bidseason #persistence #analysis
Joe North
3mo
Def the long term game but curious how long they plan to stick with the strategy (with possible market shifts) and if they are going to be patient enough to analyze the post award year results - ie: how much freight was moved vs what was awarded? In my experience this is also part of the long game as one can start to deduce trends and know better value of future awards won and better understand the ROI of said RFPs.
Robert Childs
3mo
Would be interested to know the terms of the rate agreements in the lanes awarded? 6 month? 12 month? FSC schedule? Our biggest challenge with RFPs is maintaining said margin % throughout the bid cycle while meeting capacity commitments. Quarterly bids or rate reviews seem to be mutually beneficial to broker and shipper. Have seen that more and more and that approach is what I have been recommending to our customers. Especially if they work off fuel inclusive rates.
Dan de Varona
3mo
Medium sized Brokers - You down with RFP? (Collectively respond) Yeah you know me!
As more freight moves to contract from spot, hopefully more small-medium sized carriers utilize your company to ensure their place in that customers network!
Robyn Hyra
3mo
I love seeing your company grow! Congrats Kevin Miles to you and your team!
Jay Schumann
3mo
1%...And that is 1st/2nd/3rd? That tells me those companies are rate based and most likely unprofitable for you. In this market you won't be tendered any 2nd or 3rd lanes....so you really only "won" the 1st lanes.... which you were the lowest out of how many carriers?
Chris Lowry
2mo
I had a client wanting me to quote a 12mth bid which I usually don't do. I won 28% of the 4000 Lanes. Hoping to land Ln a 12-14% margin
Father | Husband | Transportation & Brokerage
3moKevin Miles First, kudos! A win is a win, especially if it fits with their carrier network. I would agree in playing the long game, but a 1% win rate (likely less with the secondary and tertiary volumes you mentioned)? A 1% win rate seems low over 12 RFP's (~6 lanes per bid). Using an average of 14% margin, that is $210,000 in GM, spread out over 12 months is $17,500 GM per month. Curious if the the large deviation in margin target(s) played into this on a per customer/RFP basis? Just trying to 'math the math', albeit, there are many unknown variables such a cost to serve (i.e. operational efficiency). I am just trying to understand if 'the juice was really worth the squeeze' to execute this freight for one year or if it played into a further strategy?