HOW TO CHOOSE THE BEST FREIGHT FORWARDER NETWORK

HOW TO CHOOSE THE BEST FREIGHT FORWARDER NETWORK

There’s a great opportunity out there for logistics companies, and it's joining a freight forwarders network. Joining a network will help you to compete with multinationals and not miss out on a lot of businesses, benefits, and opportunities for growth. Most importantly, freight forwader networks allow forwarders to branch out by finding global partners and increasing your coverage area. Networks like Globalink and Global Value give small and medium sized forwarders a chance to grow their business. 

Ask yourself these questions:

  • What if you could increase your number of salespeople from a few, to a few hundred? And what if you could do that for a fraction of what one salesperson costs you now?

  • Would you like to expand your marketing and sales efforts beyond your local market?

  • Are you open to expanding into new market niches, new trade lanes, and new clients?

There’s a proven way to get all this and more: worldwide agency sales.

In the past, it was often not a very attractive strategy because it was high risk, with uncertain service levels and often slow pay from unknown or unseen partner agents. Nobody wants those kinds of headaches.

You are probably sick of sales solicitations from forwarder networks, but the fact that so many of your colleagues are already in these networks makes it worth taking a closer look. But, unlike other lines of business, it’s now possible to get great results with a minimal investment by joining an independent forwarders network.

Is the problem that forwarding networks don't work, or forwarders aren't working the network?

In recent years, the number of forwarder networks has exploded, and not all of them can be that good (despite their claims). Here are a few key points to keep in mind when looking the best freight forwarder network.   

The least helpful metric to base your decision on is price.

In a race to commoditize the network space, newer networks are trying to race each other to the lowest price. A network can (and should) make a significant impact on your sales efforts with added support, communication, leverage, and assistance. With that in mind, you then must ask yourself how a network makes this happen when there isn’t much revenue coming in? The marginal differences in price versus the upside of partnering with a quality network is not worth the difference in price.

Joining a network is a business investment. 

Wouldn’t you think your network should tell or show you how you will get a return on that investment? Most don’t. Saying you have lots of members and coverage everywhere is not a strategy for getting a return. If they’re not clear on this point, then what value are they offering you? Then evaluate their business model. Do they allow one member per country or as many members as possible? If they don’t have a good reason behind their model, this is a red flag. 

For instance, if they allow only one member per country, as some think is preferable, then how do they address the negative aspects of entitlement? In an exclusive network, a member buys an entire country and then decides they have all the business for that country locked up regardless of their own efforts to develop new business or provide competitive rates. We call this the “disease of entitlement.”

Waiting and hoping for new business is not a sound strategy.

We have found it far more productive to consider a network’s highest and best use as a sales tool. Using a network as a sales tool means your active participation, not being passive, as is the case with any sales. Of course, sometimes bookings will come to you as a result of being in a network’s directory, and that's great. However, this is not a sufficient sales strategy, and it's not the right reason for joining any network. What tools, features, or programs does a network have to help you make sales and new business?

Most networks have financial protections, which helps address the risks and concerns of the past. 

A low-end network tends to have low end members. In addition to being nickel and dimed on every rate, once a network partner screws up and loses one of your clients, the client is lost for life.  A one-time claim from a financial protection fund can never come close to compensating for the loss of a lifetime of business from a good client. If a forwader network promotes how large their financial protection numbers are as a key benefit, does this suggest that the low quality of the members produces lots of claims?

 

There's a novel's worth of insights that could be addressed here, but whichever group sounds best, there is one principle that reigns supreme when it comes to growing new business. It’s simple: Sales is Sales. Agency sales is not about waiting and hoping. It's imperative that you bring the same kind of proactive effort and follow up with your network partners that you would otherwise bring in your local sales efforts. No network can replace your sales efforts, and none do, because they can’t. 

Pick the right freight forwader network, bring a consistent sales effort and I assure you that joining a quality forwarding network will grow your agency business, with far more results, at less cost, and far less risk than you could in-house.

For over 20+ years, our networks, GLOBALINK and GLOBAL VALUE have proven to be the right choice for many companies like yours. We are all about partnering with members to support an active sales approach, which builds long term revenue, success, and results. Interested in learning more? Email willsiemens@glnk.com for more information!