When choosing the best carrier, the RFP process can seem time-consuming, tedious, and fraught with human error. RFP automation creates a better way.
Most businesses view the RFP stage of choosing their carrier as a necessary evil. It is a drain on company time and resources, but given the ever-increasing importance of logistics in today’s world, it is a worthwhile effort that (hopefully) leads to a long-lasting vendor relationship.
However, few business owners take the time to determine exactly how much time and manpower RFP vetting consumes. The numbers can be shocking. According to one study, the RFP process can represent as many as 4,800 work hours and take 2.3 full-time employees adding up to $311,538 a year. This is where RFP automation comes into the picture. Automated technology can make a positive difference in many other aspects of a well-run business, so why shouldn’t it have the same effect on RFPs?
Some business owners are hesitant to embrace RFP automation when choosing a vendor as part of their logistics strategy. Common misconceptions about RFP automation are that it will reduce personalization or involve unreliable technology. Fortunately, RFP automation can be as easy to use as it is effective.
RFP automation technology works by sorting through proposals, pulling data, generating notifications, and flagging items for review. It makes it easier for your team to stay on task and helps strategically vet the best vendor candidates in an oversaturated market. This is extremely helpful in the world of logistics, especially when dealing with LTL contracts, which can be complex.
In this article, we will discuss the benefits of trying RFP automation, including:
Creating a uniform process for the business
Making it easier for vendors
Saving time and money
Getting more proposals
Eliminating human error
Automated data analysis
Affordable software
Quicker turnaround on bid times
1. Creating a uniform process for the business
The RFP process should be standardized to ensure an even playing field for vendors and set parameters for your business to evaluate them. RFP automation ensures that these processes are carried out. It standardizes questions and the profile, tracks progress, generates notifications, and, most importantly, makes it easy to compare pricing from vendor to vendor.
2. Making it easier for vendors
The key benefit of RFP automation is that it streamlines and fast tracks the process for your team. This helps you identify the best logistics partner possible faster, but it can also make it easier on the end of the vendor. The automated process guides them, making it clear which information you need and how you want to receive it.
3. Saving time and money
For businesses operating on razor-thin budgets or those that wish to reduce their logistics spend this fiscal year, implementing RFP automation can free up funds by reducing wasted time. Automation reduces the need to spend time on data entry and other similar tasks.
The end result is more time for the team to focus on projects that actually generate revenue. According to a McKinsey study, tasks that can easily be automated make up 51% of activities in the economy totaling a shocking $2.7 trillion in wages in the United States alone. RFP automation can help a business put some of that money back into its proverbial pockets.
4. Getting and processing more proposals
You can cast a wider net with RFP automation. By streamlining the process, a business can vet vendors faster and take in applications from more of them. Good matches no longer fall through the cracks and competition helps ensure you get the best deal.
5. Eliminating human error
One celebrated benefit of RFP automation — and all forms of automation — is the elimination of human error. Due to the unstimulating, repetitive nature of tasks that can easily be automated during the RFP process, it is easy for employees to make simple data entry errors that can cost time and money.
In 2008, human error cost businesses in the United States and the United Kingdom an estimated $37 billion in lost productivity. RFP automation counteracts those negative financial effects.
6. Automated data analysis
RFP automation unlocks the power of data, not only allowing a business to make smart decisions about vendor partnerships, but also providing metrics to track KPI and make decisions for the future. With an RFP automation system, you may miss important data signals that would lead to better business decisions.
7. Affordable software
One incorrect assumption about RFP automation is that it must come with expensive software. Fortunately, this is not true. SaaS RFP automation is increasingly prevalent and is not expensive — plus, the savings on overhead and the increase in productivity easily offset the cost of the system.
8. Quicker turnaround on bid times
A common complaint about the RFP process among logistics professionals is that it is lengthy. In the ever-evolving world of logistics, where time is money, spending time on this process can delay implementing a budget and vendor partnership that work. The technological advantage of RFP automation solves this problem by finding the right carrier faster and helping you move on to the next business.
Bring your RFP questions to the experts at Resource Logistics Group
No matter what stage your business is at in the RFP process, it helps to have expertise on your side. Resource Logistics Group uses powerful technology paired with experience-based insight to help you make better decisions about logistics. To learn more, contact us.