Follow us on Twitter!
Blog Header Logo
DG&A's Transportation Consulting Blog
Subscribe to this list via RSS Blog posts tagged in Finance and Transportation

b2ap3_thumbnail_dreamstime_l_19275327.jpgFurther to the last blog, a well written motor carrier agreement can be a powerful tool in promoting partnerships between shippers and freight companies. Listed below are some of the major components of a comprehensive contract.

1. Parties to the Agreement

The document must clearly identify the parties to the agreement, including the use of any third parties or sub-contractors. This is very important since it is critical that all transport companies that perform services for the shipper have the same licenses, insurance and service levels as the primary party to the agreement. In other words, they must be a replica of the primary party or any differences must be so stated. The agreement must also make clear that the parties to the agreement are independent contractors. Neither Shipper nor Carrier shall have the right to enter into contracts or pledge the credit of or incur expenses or liabilities on behalf of the other party.

2. Services

a) Types of services

Hits: 938
Continue reading 0 Comments


Best in Class shippers have high quality, granular, historical freight data. They capture clean, accurate, complete data on all of their inbound, outbound and inter-branch transfers, across all modes. The most fundamental building blocks are the individual boxes, parcels, envelopes, cartons, drums or pallets.

Capturing this data correctly and completely allows a shipper to address such fundamental issues as the type of container to be used, space occupied, loading plan etc. This data is also critical when conducting an RFP as a means of selecting the appropriate modes and carriers. The data that each shipper maintains must contain certain data elements in order to be useful for analysis and planning purposes. The following data fields are essential.

 Shipment number

 Pick up date

Hits: 1137
Continue reading 0 Comments



In order to conduct a freight RFP exercise, shippers need to secure historical data on their traffic volumes by type of service (e.g. small parcel, LTL, over the road truckload, intermodal etc.) and freight costs by lane (e.g. origin – destination pair). The data serves two purposes. First, by capturing and sharing shipment activity data, it guides the carriers in creating their bids by helping them understand how the freight will impact their business. Second, the freight cost data serves as a benchmark against which to compare the rates and other carrier data (e.g. transit times) that are received.

To create an accurate data base, the following key elements are required:

a) For small parcel shipments, origin and destination postal codes are essential.

Hits: 1539
Continue reading 0 Comments


In an RFP, the carriers are being asked to bid on specific types of freight moving on specific traffic lanes. The rates they quote are based on the freight descriptions that you provide. It is essential that all aspects of the freight be documented in sufficient detail so as to ensure the quotes received are an exact match for the freight being shipped. These are some of the areas that require their input.

a) What do typical shipments look like (e.g. pallets, pieces, a combo, drums, totes etc.)?

b) What are the precise dimensions and weights of the freight?

c) How is the freight loaded and unloaded (e.g. crane, fork lift, lumper service, side loading, apartment deliveries etc.)?

Hits: 1299
Continue reading 0 Comments


Over the past eleven years, my colleagues and I have worked on a variety of successful freight RFP or freight bid projects. During that time, we have observed a number of factors that are the keys to success. This is the first in a series of blogs that will provide tips on how to run a successful freight bid.

1. Obtain Buy-in and Participation from the Operating Divisions

In some multi-plant or multi-division companies, the RFP project is approved by the head office CFO or President. While the divisions may pay the carrier freight invoices, their participation in the RFP may be limited to reviewing the proposed carrier list or bid documents or simply being made aware that the project will be undertaken. This is not adequate.

Since the division managers are directly involved with shipping and receiving goods on a daily basis, they often have information that head office personnel don’t have. It is essential that these people be engaged at the beginning, at key milestones throughout the project and at the end to ensure a successful project. The division freight personnel should be asked to not just read status requests or respond to written requests for information; rather they should also be engaged in conference calls on specific topics (e.g. freight loading and unloading requirements, documentation of local cartage runs, pick-up and delivery requirements in specific branches etc.) so the bid documents completely and accurately reflect the shipping characteristics of your firm.

Hits: 1367
Continue reading 0 Comments

For many years, industry experts have been predicting a consolidation in the Canadian freight industry. During and after the Great Recession, the decibel level of these warnings increased as most trucking companies faced the challenges of reduced freight volumes, sinking rates and the difficulty of managing a business during recessionary times. In fact, the industry did shrink by an estimated fifteen percent during the downturn, not through acquisition, but through companies closing their doors or parking equipment.

As one looks back over the past five years, the Canadian economy has been recovering, albeit painfully slowly. There has been some growth in GDP and in jobs, largely in the west. During this same period, the Canadian freight industry has been consolidating and continues to consolidate. This has been driven by a host of factors.

There were and still are willing sellers. Many trucking company owners, particularly those in the baby boomer generation, without a succession plan, or with poor prospects for survival, saw the sale of their business as the most logical business option. For some, the challenge of hanging on during the Great Recession, took some of the appeal out of the business. That coupled with the option of creating a retirement fund was a desirable route to follow.

The post-recession business climate brought a host of challenges. Just as trucking company owners are getting older, so are truck drivers. Young men and women are not interested in becoming long haul truck drivers, dealing with crossing the Canada – US border, spending weeks away from their families, for $40,000 to $50,000 per year. The driver shortage, coupled with rising costs of fuel and equipment, low margins, increasing technological sophistication and regulatory changes, have made life much more difficult, particularly for small fleets with limited access to capital.

In addition, there were and still are willing buyers. Some of the larger trucking companies and conglomerates have been active buyers. Take a look at the websites of the large truckers to see the list of companies that have been acquired. The larger fleets have seized the opportunity to increase market share, to enter new markets, and/or to acquire new drivers, equipment and management talent. With TransForce’s acquisition of Contrans, we are now seeing a very large conglomerate devour a large conglomerate. What does this all mean for the Canadian freight industry?

Hits: 2487
Continue reading 0 Comments

Freight costs often represent a significant percent of a manufacturer or retailer’s expenses.   While many companies have highly qualified CFOs and VPs of Logistics or Transportation, the management of freight costs is often sub-optimized.  This appears to be a result of a lack of collaboration between these executives with each having a different set of metrics and perspectives.  Here is my take on why this is happening.

 Business Strategy versus Transportation Strategy

CFOs are focused on the strategic direction of the business, on earnings, cash flow and return on invested capital.  They are under pressure to reduce the amount of inventory tied up in supply chains. To a CFO, lean inventory means “reduction in working capital tied up in inventory.” 

VPs of Logistics and Transportation are preoccupied with efficient supply chains.  Leaner inventories mean smaller production lots and faster transportation, which can command premium rates since they preclude the use of cheaper, longer-transit modes, and may even require paying a premium for expedited freight. On the inbound side, this can cause plant or production line shut-downs due to lack of raw material or parts. On the outbound side, it can lead to empty shelves or the loss of a customer and its associated revenue stream.

Inventory is a component of working capital. Investors look at the levels of capital tied up in the supply chain – the lower the better. However, if you take your inventory, and therefore working capital, too low, your profit margin may suffer.

Hits: 22043
Continue reading 1 Comment

Most Recent Posts


Tag Cloud

Sales Inbound Transportation Canada's global strategy LCV's future of freight industry bulk shipping Crisis management robotics Sales Training Twitter Reshoring JB Hunt driver Entrepreneur Global experience US Economy financial management Rate per Mile online shopping e-commerce drones Social Media Politics trade Masters in Logistics LinkedIn CITA Shipper Pulse Survey US Manufacturing home delibery trucking company acquisitions Comey Freight Management Transportation Buying Trends Survey Outsourcing Sales Wal-Mart shipper-carrier roundtable Load broker network optimization Rail Success Warehousing Load Boards Rotman School of Business 2015 Economic Forecast Spanx Consulting Canada-U.S. trade agreement YRC Freight Matching freight transportation conference freight transportation in 2011 Search engine optimization business start-up routing guide risk management last mile delivery Associates Sales Management Crude Oil by Rail buying trucking companies Ferromex Tracy Matura shipping wine Hudsons Bay Company driverless MPG Derek Singleton freight rate increases Software Advice Colilers International dynamic pricing IANA shipper-carrier collaboration capacity shortages Transportation service truck driver Truckload tanker cars BNSF Deferred Packaging Trump Driver Shortage hiring process Canadian economy Education 2014 freight volumes 360ideaspace Management freight payment freight audit professional drivers 3PLTL solutions provider Harper Davos speech LTL freight RFP Swift Transportation President Obama Celadon CSA freight forwarders marketing ShipMax EBOR Freight Carriers Association of Canada Dedicated Contract Carriage Railway Association of Canada ELD Driving for Profit Otto Freight Recession Freight Rates autonomous vehicles MBA Dan Goodwill freight bid NS Business Strategy RFP customer engagement Muhammad Ali Bobby Harris Omni Channel UP Freight Shuttle System Yield Improvement Business Transformation Strategy Transplace employee termination FuelQuest intermodal Packaging Climate Change Cleveland Cavaliers economy Training New Hires Adrian Gonzalez coaching ProMiles FMS broker bonds FMCSA NMFC KCS Failure consumer centric Transport Capital Partners (TCP) transportation audit cheap oil technology freight broker Infrastructure Success failure entrepreneur Canadian freight market capacity shortage Fire Phone Map-21 Blogging NAFTA Keystone Pipeline CN Rail Distribution Retail transportation supply chain management Accessorial Charges Freight contracts Finance and Transportation CN Loblaw Training Horizontal Supply Chain Collaboration Shipper Business skills Career Advice 2013 Economic Forecast Retail 2014 economic forecast transportation news Right Shoring FCA TransForce TMS Microsoft Transloading Toronto Facebook shipper-carrier contracts 2012 Transportation Business Strategies. Jugaad David Tuttle US Housing Market Emergent Strategy Canada US Auto Sales the future of transportation $75000 bond Social Media in Transportation Leadership derailments CSX Whole Foods Canadian Transportation & Logistics Donald Trump Doug Nix BlueGrace Logistics mentoring shipping fuel surcharge pipelines Canadian truckers transportation newspaper automation Surety bond APL FCPC Scott Monty New York Times home delivery Freight Regina Job satisfaction small parcel freight transportation NCC freight audit Dedicated Trucking University of Tennessee carrier conference Amazon truck drivers driver shortages 2014 freight forecast small business Global Transportation Hub US Election Life Lessons USA Truck Stephen Harper Trade Vision Doug Davis freight payment Grocery Schneider Logistics TMP Worldwide 3PL Broker energy efficiency broker security rail safety Transcom Fleet Leasing dimensional pricing peak season natural disasters Carriers economic forecasts for 2012 freight cost savings Werner Conway freight agreements Blockchain Canada U.S. trade freight costs CP Rail CSA scores selling trucking companies Freight Capacity CRM Trucking

Blog Archives