Strategically negotiate with logistics service provider to get the best price and service level
Most of the companies will perform tender process for the Logistics Service Provider (LSP) selection based on the cheapest price quotation.
Of course price matters when you negotiate LSP contracts. But what matters more is the understanding of what drives the pricing, and of what makes a service contract worth the rates you agree to pay.
To succeed in the negotiation, a thorough understanding and control of the value-added service provided by LSP is necessary.
1. SCENARIO MODELLING AND BUSINESS CASE + OPERATING MODEL DESIGN
Logistics and transport footprint
Process description with responsibilities split
2. TENDER SPECIFICATIONS AND LSP LONG LIST PROPOSAL
Tender specification document
LSP long list identification
Selection criteria and process use design
Budget and unit cost pre-calculation
3. LSP SELECTION AND CONTRACTING
Initiate offer and risk analysis
LSP clarification, alignment and negotiation process
Final selection support
Contract negotiation support
4. PROJECT DEPLOYMENT AND IMPLEMENTATION SUPPORT
Project tasks tracking
CASE 1: For a world leading chemical manufacturer, Forizons supported with tools and expertise to get the best price and service level from 3PL.
The target operating cost was defined, and new rate structure was proposed for 3PL negotiation.
CASE 2: Forizons helped a beauty product brand with the logistics service provider tender process. The Target Must Price achieved in line with the customer objective and the new operation go live date was achieved per plan.