In this episode, we sit down with Criss Wilson, Data Scientist at McLeod to talk about key data points that companies should recognize in their software what those companies can do to make key data decisions.
Before joining the McLeod team, Criss worked in material handling with Victoria’s Secret in Columbus, Ohio, then worked for the Ford Motor Company, Rodeway Logistics, FedEx, Emerson Climate Technologies (later part of Emerson Electric), and Barton Logistics. His extensive experience in logistics management and supply chain leadership, as well as logistics technology, give him a unique perspective on companies’ technological needs in this industry.
According to Criss, there are three major data points logistics companies should be focused on right now:
- The COVID-19 crisis. Trucking and logistics companies should be paying attention to data now more than ever, in light of the pandemic. Data can be incredibly helpful, especially when it comes to prospecting for customers and carriers. COVID-19 has caused a major reset among logistics companies, in addition to the dramatic drop in oil prices.
- Pricing. Until the economy reaches equilibrium, pricing is going to be a challenge for companies.
- Electronic Data Interchange (EDI). With logistics and supply chains being disrupted due to COVID-19, companies will be scrambling to get their loads covered.
Direct Solicitation in Prospecting Contracts & Carriers
The concept of direct solicitation involves prospecting for logistics contracts and carriers by way of going to market and introducing yourself directly to shippers.
“Pick your target,” Criss says. “Your target might be an industry. If you’re hauling paper, there are a lot of paper manufacturers. What marketing are you going to with that paper?
“Is there another paper manufacturer that might get you back to the market where the paper is being manufactured? You can do it by industry, region, or country – and based on backhaul opportunity or city.”
Criss says direct solicitation is all about focusing your efforts so that your company can win contracts that fold in seamlessly with your operations. Because customer acquisition costs the same regardless of that customer’s annual transportations, it’s important to take the time to vet your prospects’ revenue.
“There are various sources where you can find this information,” he says. “Take their revenue and apply a factor of 4 to 6%, and that’s their annual transportations. It’s a good starting point and it may not be exact, but it can get you where you need to be.”
Beyond using data to vet your prospect, Criss also says that cold calling is still king. Getting on the phone to reach out personally to a prospect goes a long way toward making the connections you need to acquire customers and carriers. The methodology is the same, though the data sources are different.
Here are several things logistics companies should consider when prospecting:
- Is the prospect qualified?
- Have you spoken to them?
- Do they need your service?
- Are they sanctioned?
- Have you sent them your carrier setup packet, and have they sent you their bid schedule?
Companies can analyze pricing through tools like McLeod’s Market Insight, an anonymous ratings index. This cloud-based tool allows companies to view certain industry participants’ pricing, auto rate, and more. It provides a broad range of rates and other valuable data.
The Importance of Carrier Development Teams in Logistics
It’s important for logistics companies to consider having a carrier development team to prospect based on known goods and to fill the informational gap that comes between winning a contract and beginning work with a new carrier. A carrier development team can help companies determine shipping frequency, carrier capacity development, and the general ways in which a carrier operates.
Carrier development can also help determine where load inspections are occurring, which helps companies decide what transportation lines to use.
“Look at the states where they’re getting their inspections or where inspections are occurring,” Criss says. “If a carrier says they handle LA to Chicago, but they don’t have inspections in Nevada, Colorado, Nebraska, and Illinois, then they’re not handling that over the road. They’re putting it on a train and shipping it intermodal.”
According to Criss, companies need to understand their carriers on a more intimate and detailed level than they realize. It’s important to identify analytical members of your team to carry out these analyses and vetting of carriers and contracts before going all in. Gathering these team members and forming a decision support and mastermind group can make all the difference toward company growth.
“Ask tough questions,” Criss says. “If you get crickets or deer-in-headlights looks from your team members, then form that mastermind before you go all out in decision support. Start there; get the conversation going.
“If you find that you’ve got too many people making similar decisions in different groups and departments, start looking for those super-analytical people. I would ease into it that way.”
To listen to the full episode of McLeod Insights featuring Criss Wilson, click here.