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September 12, 2023
What you need to know about procuring freight through mini-bids
Every shipper knows when it’s RFP season.

It’s the tedious time to analyze freight volumes and performance, assess costs and budgets, and look back at marketplace benchmarks during the previous bid. Then comes the preparation of the RFP for the upcoming freight cycle and outlining your projected volumes and expectations of carriers. All that leads to the grinding process of analyzing all the bids.

While they can be fruitful, the method is rigid and cumbersome and can be undercut later on when market fluctuations happen. That’s where a mini-bid can come in, which is a non-traditional but emerging way to procure freight and supplement annual RFPs. Though you might think they are for only the largest of organizations, shippers of any size can use them.

A not so mini impact
Essentially, a mini-bid is an RFP broken down into more specific and executable portions. You’ll sometime see them referred to as “mini-RFPs.”

The scope of a mini-bid is typically narrower and for a shorter duration. For instance, shippers can do mini-bids for just one region in their network and limit it to only a quarter, though all the parameters can vary. As technology has advanced, it has opened up paths to make mini-bids more possible and easier to execute, especially in the transportation industry.

Here’s why mini-bids might be the right fit for your organization.

#1: Greater precision
If you’re like most shippers, your network is not homogeneous. It has nuances and wrinkles where some lanes flow efficiently and others could be improved. Every corner of your network shouldn’t be treated the same, which means you should employ different bidding options.

Mini-bids allow you to zero in on areas that need customized attention. For example, perhaps you realize you have a cluster of lanes in a part of the country that get impacted by the produce season every year: capacity dwindles, delays happen, and rates increase.

That region is ripe for a mini-bid. By isolating it from your RFP, you can get a proposal just for those lanes from carriers that serve that area. Looking at your network in regions and sections like this is a lift on your end, but it can pay off in the long run.

#2: More speed and agility
Supply chain dynamics are inevitable: peaks and valleys, seasonality, freight regulations, and more. As a shipper, you’ve likely been faced with the situation of being tied into certain rates but watching helplessly as the market fluctuates.

Mini-bids are a helpful foil to those conditions. They give organizations the flexibility to respond to the changes in the market when they happen. This is something RFPs generally don’t have the ability to do.

For example, a business may open up a new distribution center in Phoenix with lanes to Dallas. Rather than wait until the end of the year and package those lanes in an RFP with the business’s entire shipping needs, it can quickly single out the Phoenix-Dallas route for bids.

Undoubtedly, today’s world and your end customers demand speed and mini-bids deliver. While comprehensive and thorough, RFPs are a large effort for any organization and mini-bids are a smoother, swifter option.

#3: Smarter optimization
With this comes the opportunity for shippers to test out different carriers and replace ones that are not meeting expectations. Because mini-bids offer such flexibility, shippers can use them to make corrections and experiment with providers that they otherwise may have dismissed.

Perhaps you have a portion of your network that needs a specialized carrier, one who has the capacity and equipment you need during your biggest promotional period. By putting a mini-bid together for just that need, you can try out new freight providers that your RFP process may have overlooked. It’s a “try before you buy” opportunity.

Take the next step
Mini-bids are not a wholesale replacement of RFPs, but every shipper should be considering them in their tool box. They can help organizations keep up with market changes and optimize their network with carriers they never considered.

Amazon Freight has more than 50,000 trailers and carriers at its disposal and works with shippers of all sizes to deliver their goods safely, reliably, and efficiently. Contact us to see how we can help optimize your shipping or get started today by creating an account.
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