The Bid Process

The Bid Process

LTL and Truckload Bid Packages Should Include:

1. A carrier questionnaire
The questionnaire asks for background information about the company, including such things as size, number of pieces of equipment, insurance information, and references.

2. A copy of your contract
You want Carriers to review and agree to your contract up front. In the past there have been instances where a Carrier awarded the business would balk at signing a contract.

3. Your company profile
Outlines your company operation, including:
- What types of products you ship, along with handling requirements
- Minimum equipment requirements
- Plant loading hours, along with specific plant requirements
- How your bids are defined (i.e., cost per mile), and how invoices are paid
- Your criteria for accepting the winning bid
Other details such as, but not limited to the following, are required:
- Insurance
- Freight Terms
- Driver performance
- Delivery performance
- Associated support documentation
- Cash Flow
- Payment Policy
- Operating Ratio
- Claims Ratio
- Accessorial services
- Cost/term
Note: For LTL bids you must indicate the base tariff to be used and the FAK class ranges.

4. Bid template
An outline of shipments for each lane up for bid is presented. The template includes such things as:
- Number of historical shipments for each lane, broken out between dry and frozen
- Number of loads shipping as truckload, versus LTL

5. Carrier performance report
You should measure your Core carriers on several criteria, including such things as on-time delivery, accurate invoicing, and their number of missed loads. Include a copy of this report card with the bid packages so that Carriers understand how their success will be judged. Carriers who fail to meet your performance criteria will be replaced.

6.
In order to be considered, a Carrier must return a completed bid template, along with the following documents:
- Contract compliance statement
- Completed Carrier questionnaire
- Copy of insurance certificate
- Copy of Motor Carrier Safety Rating letter
- Authority (Common/Contract Carrier or Broker)
By receiving all of this information up front, you ensure that any bids that you consider are from carriers who meet your requirements.

7. Analysis
The carrier response should then be collected and a short list created. You should be able to establish first, second and third tier carriers, based upon geographic coverage and transit times. The carriers within these levels should be maintained for current and subsequent use.

8. Negotiation
Elimination of carriers and final review of balance
Renegotiations of any changes to bid package

9. Final Selection
Final selection is based on some of the following decision criteria:
- Size of the company: Smaller companies, where you can be a significant portion of their business, tend to give better service than the national carriers.
- Ability to handle refrigerated loads (if applicable):
If a portion of our shipments contain frozen product, or require heat.
- Carrier should have its own assets:
While most carriers do broker out some of their volume, you expect them to carry the majority of your orders on their equipment, using their drivers. This ensures consistent service. Also, carriers who have some of their own equipment are in a better position to respond to any last minute rush orders that may develop.
- Carrier must have a demonstrated history of providing outstanding service