critical, but carrier capabilities such as tracking, visibility, specialized equipment, and timely delivery tend to take priority. In particular, shippers prioritize visibility—of both their driver and cargo. “Shippers are looking for a system with tracking options so they know what is going on with their delivery,” Mammadov says. When a delivery requires special handling or equipment, shippers need to know the carrier can provide these solutions. If the cargo is valuable, they also want to con rm the carrier has adequate insurance. Given shippers’ concerns about delivery quality, carriers that highlight their capabilities can more effectively justify their rates. “I encourage carriers to focus on their reliability, their on-time record, and their safety record,” Bouk says. THE CARGO Only after carriers know the type of freight they are being asked to transport—along with its weight, size, and other attributes, and its need for special capabilities like temperature control—can they intelligently assess whether they have the necessary equipment to properly handle the freight. They also can better estimate how much fuel they’ll use, how much equipment wear-and-tear to expect, and whether their insurance coverage is adequate. With this information, carriers can prepare an accurate and thorough bid. To help carriers prepare bids that accurately re ect the services they will provide, shippers also need a solid handle on the goods they’re moving and any special services that might be required. For example, some shippers are starting to require higher levels of insurance. While policies covering up to $100,000 in claims had been the norm among carriers, more shippers—including many ecommerce companies—now ask for $250,000 policies, says Jaehning.
Transportation fraud is accelerating rapidly—and it is now popping up in contract negotiations. The fraud can take several forms. In one instance, a shipper receives an email that appears to be from its carrier, stating that the carrier has changed bank accounts. Without verifying this information, the shipper sends payment to the new account. Eventually, it becomes clear that the payments are going to criminals, not the carrier. When shippers inadvertently pay a fraudster, they typically remain responsible for paying the carrier. “The carrier still needs to be made whole and the shipper is still legally on the hook to make that payment,” says Josh Bouk, executive vice president and chief partnership o cer with TriumphPay. It’s critical that shippers take steps to confirm the party that they are paying, he adds. In another type of fraud, a carrier bids on a shipment load from a load board, believing it’s from a reputable broker. The carrier picks up and delivers the load according to the agreed-upon terms. However, when they try to get paid for their services, they’re unable to reach anyone and discover the individuals behind the bid were only pretending to be reputable and have since disappeared. “This fraud has exploded since COVID ended and the freight market dropped,” says Lewie Pugh, executive vice president with the Owner Operators Independent Drivers Association. Carriers can reduce their risk of falling victim to this type of fraud by checking the bill of lading (BOL), which should always list the carrier’s name to confirm who is delivering the load and include shipping details such as delivery times, location, and any restrictions. This information can be compared to the rate confirmation to ensure they match. Additionally, carriers can limit their searches to load boards run by large brokerages or double-check postings on commercial load boards. Shippers also benefit by confirming that their BOLs are updated and complete. Without this information, “shippers don’t have a clue whose truck their goods are on,” Pugh says. HOW TO HANDLE FRAUD A new and growing challenge for contract negotiation
July 2024 • Inbound Logistics 129
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