TransportGistics

Executive Summary
Negotiating freight costs / services has many meanings. For some shippers it simply means that whatever is being charged must be reduced. This attitude telegraphs the posture of the negotiations and eliminates the potential of “knowledge based transportation negotiations”. Likewise, some carriers, perhaps better described as spoilers, chase down their competitors’ customers and offer freight rates and charges that are lower than the current level. These approaches are not necessarily “bad”; but they are incomplete! They lack a proper foundation for a mutually advantageous business relationship because they immediately fail to recognize each partner’s assets as well as the relationship’s assets. In order to overcome this inherent failure, changing the perspective from “cost and service negotiations” to freight transportation negotiations should suffice.

All relationships that seek mutual benefit must satisfy the fundamental requirement for “balance”. When the scales are tipped, the natural balance is destroyed and the ability to mutually exploit the purpose of the relationship is cancelled. Freight transportation negotiations are a complex process consisting of alternative methods of approach, strategies and objectives as well as a multitude of steps. Because the results we seek are dependant on these activities, the “balance” remains at risk. To assure success, the “balance” must be respected and secure at all times. How we approach freight transportation negotiations will significantly influence our ability to achieve the balance; and will determine the relationship’s ability to provide the identified benefits and objectives.
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