Logistics Tender Management
Tendering logistics operations is the first step in developing a potentially long-term relationship with a 3rd party logistics provider. The logistics tender management process is the foundation of that relationship and as such, needs to be conducted very carefully.
It is critical that the tender truly reflects the operational requirements and volumes for the requirement, and clearly states the service levels and performance required. One of the main reasons 3rd party logistics contracts fail is that operational and volume information is not accurately provided in the tender process, leading to the suppliers inaccurately modelling the requirement. This can then lead to resourcing, capacity and cost issues for the 3PL, which can ultimately lead to service failure.
As well as ensuring the operational requirements and volumes are accurately reflected in the tender, it is also critical that all responses are assessed against a background of the suppliers existing capabilities. A supplier’s business development team may make proposals within the process that aren’t consistent with their operational team’s views and priorities; consequently, it is important to engage with the potential supplier’s operations team, visit their existing contracts, as well as speak with their existing customers.
How Our Logistics Consultants Can Help
To identify the right logistics partner, and the right solution, it is critical to approach the logistics market with a fully considered and detailed tender. Our logistics consultants can manage the full tender process for you; from identifying the right suppliers, through to data collection, writing all required documentation and managing the tender process from start to finish.
Typically there 9 steps in logistics tender management, although this can vary according to the type of operation and the exact clients requirements. The typical 9 steps are:
The first step in the outsourcing process is to determine, and get management consensus, on the reasons for outsourcing the logistics operations. Our consultants can help you ascertain the potential benefits and potential pitfalls of using 3rd party logistics provision.
The most crucial element of any logistics tender exercise is to establish a data profile that logistics providers can model against, and that truly represents your business. The consulting team can provide robust templates for the information required and will undertake analysis to ensure all data is consistent. Furthermore, the consultants will also meet with the key stakeholders from your business to ensure that all ‘soft’ issues are captured as well as quantitative data.
We hold an extensive database of contacts within the 3rd party logistics industry, from all the main logistics providers through to regional warehouse and transport providers. We also have an extensive knowledge of market capability and, often without the need for a ‘Request for Information’, we can get the right logistics providers engaged ensuring a maximum number of suitable tender responses.
From managing the full tender timetable and keeping all the stakeholders informed, to ensuring non-disclosure agreements are in place with all logistics providers, our consultants will take full responsibility for every part of the process.
We will scope, draft and finalise the full Invitation to Tender. The document will be comprehensive, covering all aspects of your operation and requirements. The document will also be clear, succinct and highly prescriptive, minimising the risk of misinterpretation by logistics providers.
Our consultants will maintain open communications with all logistics providers, ensuring that any questions raised are answered clearly and promptly.
We will undertake a detailed quantitative and qualitative assessment of all proposals received. Scoring will be assigned based on relevant criteria and a comprehensive Response Assessment pack will be presented to you. This pack will provide you with a summary of all responses and details of scoring and comparative performance of each submission.
The consulting team will advise, based on the Response Assessment, the most suitable providers to take into the final shortlist phase. We will also organise shortlist provider presentations, presentation agendas and site visits where required.
We can support you in the final selection of a provider and in the exit of existing contract provision that may exist. We will help you manage the change, ensuring limited business disruption, and full stakeholder engagement.