Cracking the RFP Code | Ep 49

Justin: 00:00:00

In today's episode, we're discussing RFP management from a broker standpoint. And as a broker, how do you increase your likelihood of success to win that contracted freight? Brian, personally, I have some mixed feelings on RFPs.

Give me your thoughts and tell our audience what exactly is that?

Brian: 00:00:26

Yeah, so RFP in our world is any type of request for pricing, request for proposal. Usually shippers and decision makers do this once every six months, once a year. Usually.

You see a lot of, like the Fortune 500 companies, they'll run one at least once a year, once every six months. What they do is they vet out, vet new carriers coming into the network, kind of get pricing aligned for the next fiscal year.

A lot of times these public companies, they have to report to Wall Street. Therefore, they need to get some sort of budgeting forecast on the books so the CFO can make strategic decisions about the company.

Now with us, what does that mean? So if I'm a broker, I'm a salesperson, and I go into it and I say, the prospect says, hey, I've got this RFP coming out in December.

Justin: 00:01:12

You can retire.

Brian: 00:01:13

Yeah, yeah, I've got this rfp. I've struck gold.

I know several reps that come to us since we're in leadership roles, they've come to us and say, hey, I got this big RFP coming up with a huge client. To us, like, we've been down that road before. Our success rate hasn't been great the past, like, three or four years.

But, you know, at the same time, it is an opportunity to be invited to those events and to learn more about their lanes and more about their process. I think the best way to approach it, I love trying to have some sort of relationship along the lines with an rfp.

So if we're super transactional and we just fill out the bid and we submit pricing, and then we just hit the green button and we hope for the best. I think our likelihood of success there is not going to be very good.

But if we're able to create a relationship with the logistics manager and figure out where they need the most help or where we can bring the most value, I think that's the best approach, especially for a broker our size, which is 25 people. You know, we're running thousands of loads a week at the same time. We're not the TQLs of the world or the C.H.

robinsons or the, you know, the RXOs and that sort of thing.

Justin: 00:02:21

I want to back up to what you just said, because it's funny you mentioned you know, got an RFP coming up.

Brian: 00:02:25

Yeah.

Justin: 00:02:26

You know, they throw it over. You have no relationship in place, right. From sales side of what we do.

If I don't have a relationship and a prospect tells me we have an RFP in let's say, March, that's like an objection. That's how they get me off the phone. Because I've heard that countless times.

No matter how much I still pursue them to try and get involved in that rfp, there's no relationship established.

So all they're doing is collecting data from us to benchmark likely with their incumbent carriers who they're probably going to contract, their continue contracting with regardless. So, you know, in RFP they send out all their lanes.

They want to get locked in or contracted pricing on those lanes and they invite carriers that they work with, which are incumbents. Also they might invite a handful of non carriers or non incumbents or carriers they do not work with to participate as well.

So you quote all their lanes, you submit it if you have that relationship in place.

How do you retain the business that you have, the load volume and lanes that you have, but also win more volume on top of what you already have established?

Brian: 00:03:34

Yeah, I mean my approach has always been this. As an incumbent carrier, those are the lanes we have established carrier networks with and those are the lanes that we're good at.

So we'll just say St. Louis to Chicago for a drive in shipper is one that we, you know, we have and we dominated and we've done a really good job with it.

How do we get more St. Louis to Wisconsin or St. Louis to Minnesota or St. Louis to Indiana? Right.

How is it, you know, still in kind of like your niche for those large, larger shippers and customers, but just a little bit more outside where you're gaining more volume and you can still use that carrier base, we'll call it, based out of St. Louis.

Justin: 00:04:10

And let's take it from a different angle here. You're a carrier with outsider, I'm just say non carrier. You don't work with this shipper. Yeah, yes, you are coming in this RFP and participating.

And let's look at it from this angle as well. You're outside their network. You're invited to participate in this RFP for the first time historically, and this is how we've done it too.

But a lot of brokers will just go and throw rates. They'll run it through DAT or some batch rating system, some type of system that has rate data. They'll run it all through, let's say it's 500 lanes.

They quote all 500, they send it back and they're like, nice, perfect. Yeah, let's see if we win. Why is that mistake that occurs very often?

Brian: 00:04:55

Well, I think it's the path of least resistance. Right. And I think that people don't want to do the work.

And I think the biggest thing that other brokerages or other carriers can do is really bring value for a certain niche. So niche down on a market?

Justin: 00:05:10

Yes.

Brian: 00:05:10

And maybe you don't run those lanes currently and maybe it's a brand new prospect and you know, very limited. But. Okay, how do I niche down in this certain market? And I want to be known for the carrier that's Atlanta outbound to the East Coast. Okay, perfect.

Well, make sure that you're providing rate data that can be competitive for that lane. And then, you know, we still want to quote everything out and some of those kinds. You said 500.

Some of the most RFPs that we've run recently are in the thousands, right? A thousand, two thousand, five thousand. I think there was one we just filled out the other day. It was like 10,000 lanes.

I mean, you can't niche down on every single lane in that 10,000 lane RFP. But if you can pick a specific shipping point or a specific area, the chances of you having success are better off.

Justin: 00:05:59

Yeah. And here's my advice and it's right in line with yours.

But if you are a newer carrier that's being evaluated and have an opportunity to participate, which clients do you currently work with or which shippers do you currently work with who have similar lanes? We do a lot of produce, we do a lot of beverage, we do a lot of food.

We can go and use our internal data to create a presentation and drill down into markets that we are very, very strong in. Here's our metrics, here's our on time delivery, on time pickup for these particular lanes.

Here's the volume we're running, here's the retailers we're delivering into. Now we're presenting, hey, I know you have 500 lanes, but we worked with our internal network.

We have 10 carriers that can fulfill these 50 lanes year round at these rates. And here's the data showing that we can execute on these lanes. Now we're being a little bit more strategic.

Brian: 00:06:50

Love it.

Justin: 00:06:51

And we're bringing something to the table, showing them that, hey, we already are doing this.

Brian: 00:06:55

Yeah, I love it.

Justin: 00:06:56

We have additional capacity and we have carriers that can run this consistently as opposed to throwing a bunch of rates in an Excel file and hoping you.

Brian: 00:07:02

Get awarded something and hitting the green button. Yeah, that's exactly right. I think there's a couple things that you can do differently.

The things that you just mentioned, as far as being strategic about the process, I also think the relationship, trying to form or create a relationship with those people that are handling the rfp, and that might be through a virtual call. It might be through a handwritten card or a note. It might be through something different when they're in that selection process.

But I think those are things that we always try to push.

Hey, push for that virtual call, get a little bit better of an understanding where we can actually show them that we care and we want to bring value to their network.

Justin: 00:07:40

Yeah.

And on top of that, I love that you said that, because if you're invited to an rfp, and I mentioned this earlier, where I make a call, they say calls, you know, RFP in March or whatever.

Brian: 00:07:48

Yeah.

Justin: 00:07:49

And that's the last time you talk to them and then expect it to get invited to the rfp, Quote it and win.

Brian: 00:07:54

Yeah.

Justin: 00:07:55

Like you have a zero percent chance of winning. Zero.

Brian: 00:07:58

Yeah.

Justin: 00:07:59

Because we've seen it time and time again. And when we do, I don't know, 150rfps a year, we never win. The ones where we don't know anything about their needs.

Brian: 00:08:08

Yeah. I think the ones where we're super transactional.

Justin: 00:08:11

Yeah.

Brian: 00:08:12

Those are the ones we lose. Correct. Every time. Yeah.

Justin: 00:08:33

But when we can bring that strategic vision to play and whether we're going to visit them, we'll Visit clients before RFPs and figure out what we can take on there.

But setting up this virtual calls, yes, we'd love to participate, but can we at least set something up before so we can better understand your needs and what areas we need to focus on? Because we say it all the time. But if we can't bring value to the table, there's no sense in working like it has to go both ways.

Can you use this and can we bring value? If the answer is no, then there's no sense in even having a conversation.

I'm not going to waste my time putting together an RFP if it's just zero percent chance of winning.

Brian: 00:09:12

Yeah, I think. I mean, there's.

RFPs are a big part of the business and the more equipped and the better preparation that you do is going to give you a better shot at winning some lanes. Now, on an rfp, do you want to win?

I think the goal too is like, you know, I think some brokers out there, they want to go into it and oh, on this 500 lane RFP, I want to win 200 lanes. Like, I'm sorry, but that's, that's just not going to happen. Right. Maybe if you're like a ch, that might occur.

But I think if you can carve out four or five lanes, hell, maybe 10 lanes at the very most, very specific shipping point, very specific delivery point, then you can provide some value and actually get yourself a shot at winning some of those lanes.

Justin: 00:09:55

Yeah. One thing I'll mention, I'm glad you brought that up.

I've seen you do this a number of times, but there are some RFP platforms that will auto populate feedback after like the first round, second round, maybe. But one thing I've seen you do.

Brian: 00:10:12

How low can you go?

Justin: 00:10:13

Correct. And that's what it is. It drives pricing down. But one thing I've seen you do is you'll schedule calls in between rounds of RFPs.

If there's multiple rounds and you do this with a couple of our close partners and you will have that very transparent like conversation about, hey, what do we need to do to take on these? Like, these are the additional lanes that we want and a lot of times we'll retain that, those lanes that we're already running.

But you're setting up a very transparent conversation to get that feedback and increase our chances of taking on more.

Brian: 00:10:43

Yeah.

Justin: 00:10:43

So you're getting that face time in between rounds where we know there might be a few other carriers that, that have that opportunity, but it's not that common. And you get an idea about where we can increase volume.

Brian: 00:10:53

No, I agree. I love that we have partners that will have those strategic discussions. I'm still pissed off about that. Mankato lane. I want Mankato, Minnesota back.

Justin: 00:11:02

So I'm familiar with this.

Brian: 00:11:05

Well, no, this is all great information.

I think if you're a younger broker out there, if you're any broker that is having these RFP discussions, hopefully you take away some of the value that we've brought to this discussion today and you can use that for future RFPs, future conversations with your prospects and your customers.

Justin: 00:11:22

And let me leave you with this. If you're participating in RFP and you're a new carrier to their network, let's say they're opening up their RFP to 10 new carriers.

How are you going to separate yourself and be different from the other nine carriers that are being evaluated? We had an opportunity a couple of years ago. I thought it was just ran flawlessly. We were over the top. We met with them.

Brian: 00:11:47

Is it the one with US Foods?

Justin: 00:11:48

Yes.

Brian: 00:11:48

Yeah. Okay.

Justin: 00:11:49

Yes. We built relationships, had great conversations, met with them, presented to them, marketed to them, sent gifts, thank yous.

I mean, hell, it was great. I had all the confidence in the world that we would win. We lost, but we still have a relationship.

They were going a different direction with internal partner that they have and the incumbents that they work with. So it wasn't necessarily a reflection of us. But my point in saying this is you have got to separate yourself by being different than everyone else.

That is the only way when they're looking at just pricing, and you may be a little bit more expensive, but, like, the only way you're gonna stand out is two things.

If you're really expensive, if you're really cheap, or if you're different than everyone else and you bring something to the table where they're like, oh, that's Veritas or that's ABC Company. Let's give them a shot, because I really like those guys. So keep in mind, it's not always about price.

It's what can separate you from the rest of the pack.