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Video - How Collaborative Outsourcing Can Improve Your Transportation Logistics

Paper (read for sustainability concepts) - Sustainable Maritime Freight Transportation: Current Status and Future Directions

References Hazen, K., & Lynch, C., The Role Transportation in Supply Chain, CFL Publishing, 2008.

Alexander, Kyle. "Cultivating Healthy Carrier Relationships." Shipper Needs: How Carriers Can Get Above the Fold. N.p., Sept. 2008. Web. 29 Aug. 2015.

Alexander, Kyle, and George Abernathy. "The Power of Relationships in Shipper-Carrier Negotiations." Http://www.industryweek.com/software-amp-systems/power- relationships-shipper-carrier-negotiations. N.p., 29 Apr. 2010. Web. 29 Aug. 2015.

"Improving Shipper/Carrier Relationships." Http://www.inboundlogistics.com/cms/article/improving-shippercarrier- relationships/. N.p., May 2015. Web. 28 Aug. 2015.

Leinbach, Thomas R., and Cristina Capineri. "Globalized Freight Transport: Intermodality, E-Commerce, Logistics and Sustainability." N.p., 8 June 2007. Web. 15 Aug. 2015.

Weakly, David. "3 Ways to Improve Shipper Carrier Relationships." Http://kingsolutionsglobal.com/blog/3-ways-to-improve-shipper-carrier- relationships/. N.p., 10 Aug. 2015. Web. 29 Aug. 2015.

Carrier and Shipper Relationships The following areas can assist shippers to improve their carrier relationships if adhered to by all and a give/take partnership occurs. Both need to acknowledge supply and demand and operate in ways that will meet the needs of all concerned. Be informed on what is going on within the global market, as well as the domestic arena so that no one has the advantage over the other. Be knowledgeable of your business and the needs and requirements of your consumer. Keep current on your companies and vendors’ other commitments and discuss any problems, solutions and potential future steps to improve your services. Manage the process be involved in the negotiation process, contract process, ensuring to maintain control and be in contact with your carriers throughout the term of the contract. Understand conflict will arise between you and the carrier/customer strives for win-win situation for all. We all know the saying the customer is always right still holds, and maybe even more so, these tough economic times we are experiencing, so a mutually beneficial outcome is best for all (Hazen & Lynch, 2008).

A carriers' development and maintenance of a relationship is vital but more importantly there needs to be a willingness for the carriers’ to provide the needed services to the customer

According to Leinbach and Capineri (2007),

Having identified the quest for a seamless transport market, it is important to identify the forces which are driving this quest. First, in a general perspective, it is clear that intense competitive pressures require goods- and services-producing firms to manage almost simultaneously multiple inter-organizational information and material flows (p.4).

This seamless effort is not an easy task to accomplish due to numerous reasons, i. e. congestion and delays in loading and unloading, which can cause bottlenecks in the chain, many of which are not in the control of the carrier or the customer. As a carrier, being able to deal with these constraints is what sets one carrier apart from another.

According to Alexander (2008) the following practices will assist a customer to maximize their value within the carrier relationships. When looking at the developing robust relationships with your carriers it can be challenging, but it's essential to establishing well-defined expectations in order to meet the needs of all the customer’s transportation needs.

There needs to be an establish trust and credibility with carriers, this is not something that will occur overnight, like any relationship, it takes time to build that trust between carriers and service providers. Trust can also be looked at as the basis for future expectations. When looking at trust, if neither side is too opportunistic now, the future value is in question (Alexander & Abernathy, 2010). One of the keys to developing this trust is to identify and align your customer with the carriers whose cultural values closely match those of your organization (Alexander, 2008). Once that happens, then the reinforcement of these relationships through reliable volumes, open communication, and opportunity development (Alexander, 2008). In short, business relationships need to be valued as future expectations are supported by past actions.

Communication needs to be specific in order for the carrier to know the exact expectations of the company. The more the carrier understands and can meet your expectations the more the carrier will be able to meet your transportation needs in a collaborative manner (Alexander, 2008). If the carrier knows what the customer considers failing or exceeding your expectations then you will be able to reward outstanding performance and enforce those established expectations (Alexander, 2008). When you have established what your customer’s expectations are, then you are no longer trying to enforce the performance, you are setting your carrier apart for other carriers who are only in the reactive mode (Alexander, 2008). Creating opportunities to maximize carrier networks at the same time minimizing supply chain costs will pay big dividends to the carrier. The relationship between a carrier and customer is about more than service expectations, capacity, and rates. It is also about maximizing the carrier's network value and efficiencies (Alexander, 2008).

Alexander (2008) goes on the say the creating lasting alliances is the nature of the carrier business. This is not to say that all relationships with be win-win, because they won’t no matter how good the relationship has been developed. Most carriers should be attempting to create the atmosphere that all entities obtain something of value so as to evolve into a lasting business alliance (Alexander, 2008).

Business relationship needs the same give-and-take that all other relationships have in order to create that lasting relationship to survive the good and bad times and continue to improve through transparency, sincerity, and direct and open interaction (Alexander, 2008). When you know how to effectively work with your carriers, you realize the impact of what each of wish to achieve, and you are able to deliver tangible and sustainable results (Alexander, 2008). If you are not that in tune to what your customers are looking for then it can be more of a hit and miss and the results will not always be favorable.

Alexander & Abernathy (2010) stated the many shipping companies are stressing cost savings over establishing and maintaining good business relationships. They looked at this expectation of maintaining a quality relationship not as important for future business, as much as they need to keep the costs low enough to ensure that no other carrier will meet those shipping needs more cost effectively. When one just looks at cost when trying to establish or maintain a business relationship it will more than likely end in a disastrous relationships because cost is not the only criteria that is deemed important, it needs to be combined with negotiations, such as reduced capacity, declining service, increased costs and significant dock backups (Alexander & Abernathy, 2010).

According to the article "Improving Shipper/Carrier Relationships" (2015) there are a few areas that will make your customer/carrier relationship very positive. All carriers need to work towards a win-win situation. Working with the carrier to find out what type of supplies and freight being transported will allow them to figure how what mode of transportation will meet your needs to best. This will help to codify a long-term shipping relationship. It is very important to ensure that as a carrier company that you follow through on the commitments that you made with your customers. If, over and over you fail to hold up your end of the commitment, then the customer will begin to think that they are not valued and will look to other carriers who honor their commitments. If you carrier is able to refer customers to partner carriers when unable to meet the needs that will go a long way in showing customers that even though your carrier is not able to meet their needs, you have a carrier to provide to them. When this happens all benefit from these shared relationships. In the end, the original carrier is the overall winner by

earning more of your and possibly other customers business ("Improving Shipper/Carrier Relationships", 2015).

A carrier’s ability to keep friendly transporters, who are easy to work with will also ensure your longevity of business. When you have transporters that are long-term, they will know your business procedures well and ensure the pickups and deliveries are as efficient as possible. As a carrier, it is important to make sure you know if your customers will need weekend, late night or early morning services, so that their operations won’t be held up due to your carrier not being able to meet those delivery time ("Improving Shipper/Carrier Relationships", 2015).

All things transportation start and end with effective communication between the carrier and the customer. It is important to periodically, such as quarterly, sit down with your customers to see if their needs or expectations have changed, advise them of any new services your carrier can provide and what their overall satisfaction of your delivery services are. Knowing this vital information will allow your carrier to make any changes to ensure your customer’s needs and expectations are still being met to the best of your ability. This prior communication will make the renegotiations much easier and more effective as their will not be anything unexpected popping up ("Improving Shipper/Carrier Relationships", 2015).

In closing, when it comes to the importance of customer/carrier relationships it is a given that the relationship needs to be continuously worked on. The longer you work together, the more trust that will developed between you and the carrier, it can be a lot of work to establish that kind of relationship, but in the end it is more than worth it. After all, for the carrier to stay in business they have to have a good customer base. It really comes down to almost becoming friends with your customers or at least befriending them so that they will start to see you as a person and not just a number (Weakly, 2015). Customers and carriers values and expectations are very important to any relationship but to a business relationship it is vital. A healthy customer-carrier relationship are worth the work they take to establish and maintain but are most certainly needed to keep the carrier in business.