A routing guide might seem insignificant or all-powerful depending on your role in the supply chain. Essentially, it offers a defined framework of instructions and actions for efficient supply chain management and execution. However, many supply chain professionals still grapple with the question: “What Is A Routing Guide, and how does it benefit my organization?”
To address this, it’s crucial to understand that a routing guide is not a static document. According to Brian Straight of FreightWaves, it’s a dynamic resource that facilitates faster transportation management and keeps freight spending under control by factoring in lane volatility, as highlighted in SONAR SCI Lane Acuity. Creating an effective routing guide can be challenging, and misconceptions about its contents persist. Therefore, understanding its core functions and their relevance to its creation is essential.
1. Routing Guide: A Prioritized List of Preferred Carriers
When considering “what is a routing guide,” the foundation lies in a well-defined list of preferred carriers for freight tendering. In essence, it directs shippers towards carriers offering the most competitive transportation rates based on established contracts. This encompasses both short-term and long-term freight agreements. Consequently, enterprise shippers must prioritize carriers that provide the best and most reliable service levels for each shipment. Naturally, this assessment is subjective and dependent on market stability within specific origin/destination pairings.
Alt: A graphical representation showcasing the process of prioritizing carriers within a routing guide based on their service levels and origin/destination data for optimized shipping.
Actionable Insight: Prioritize carriers within the routing guide based on their suitability for specific shipments, considering origin/destination data, service levels, and contract terms.
2. Routing Guide: A Defined Set of Rules and Requirements for Shipping
Another perspective on “what is a routing guide” involves its role in establishing rules. A routing guide outlines a shipper’s specific rules and requirements for both inbound and outbound freight. This includes aspects like available dock scheduling times, resources used for scheduling deliveries or pickups, driver certification requirements, digital documentation protocols, centralized controls, and many other considerations. The list is extensive, but its purpose is to provide a clear set of rules that allows accurate routing of every shipment from the moment it’s processed within a warehouse, distribution center, or order fulfillment center. The routing guide should also incorporate location-specific rules, such as those for warehouses versus brick-and-mortar stores used as e-commerce fulfillment centers. This necessitates increased visibility for shippers, leading to enhanced forecasting accuracy in all related decisions.
Actionable Insight: Detail specific requirements related to volume, pickups, deliveries, documentation, and other relevant factors to ensure smooth and compliant shipping operations.
3. Routing Guide: Instructions for Managing Shipping Delays and Changes
The routing guide further provides direction on how to handle delays or changes in shipping demand. This is especially crucial given market volatility and the potential for increased tender rejections. Higher rejection rates invariably lead to shipping delays, a fundamental principle in supply chain management. However, the routing guide’s value lies in outlining strategies to preempt and address these delays, leveraging predictive freight rates to mitigate the potential impact on the customer. For example, it might involve rerouting the shipment, transferring it to a different load or mode, dispatching a new driver, or implementing other measures to ensure compliance with the routing guide’s protocols.
Alt: An illustration depicting the process of using a routing guide to manage shipping delays and reroute shipments, optimizing for efficiency and minimizing customer impact.
Actionable Insight: Incorporate dynamic considerations and multiple “what-if” scenarios to proactively mitigate potential disruptions and ensure business continuity.
In conclusion, a routing guide is more than just a list; it’s a strategic document that streamlines shipping operations, minimizes costs, and enhances customer satisfaction. By understanding its key functions and implementing the actionable insights above, businesses can leverage routing guides to optimize their supply chain and gain a competitive edge.
