Evaluating Automatic Spot Quote? Consider these things.

You may have been used to freight forwarders providing automatic spot rate quotes for a shipment that needs to be sent immediately or urgently since rush shipments are the main driver of spot quote needs. Freight service providers will often add an expiration date along with their quote as the price can vary by a week or by day. This can be convenient and sometimes cost-effective, but there are several reasons why it may not be the best choice for your business.

Here are some of the factors to consider when evaluating freight forwarders that offer automatic spot rate quotes:

Inaccurate Quotes: Spot rates are often subject to market fluctuations and may not reflect the actual cost of shipping your goods. These rates may not consider any specific requirements for your cargo, resulting in an incomplete price.

Lack of Transparency: This pricing process lacks transparency, making it challenging to assess the quality of services provided or compare quotes from different forwarders.

Limited Flexibility: Automatic quotes may not be customizable or negotiable to meet your needs, resulting in a lack of flexibility when arranging custom shipping solutions.

Quality of Service: Forwarders that quote in this way may lack the same level of expertise or experience as a traditional freight forwarder who provides human interaction and personalized support.

Rates are Non-Negotiable Once Booked: Once you have booked a shipment based on a spot rate quote, you may be unable to negotiate the price further, even if the market price falls.

Difficult to Change Vessels or Destinations: It can be challenging or even impossible to change the vessel or destination once your shipment is booked.

Inability to Combine or Split Bookings: Freight forwarders that rely on automatic quoting may not accommodate combining or splitting shipments, resulting in additional costs and delays.

Cancellation Fees Incurred Once Booked: If you need to cancel a booking, you may be subject to unquoted

cancellation fees that vary depending on each carrier’s terms.

Amendment Fees: You may incur amendment fees if you need to change or amend a booking.

Limited Destination Free Time: Your shipment may be subject to higher demurrage and detention costs, as free time may be limited –a detail usually not addressed by automated spot rate systems.

Remember spot quotes have a “snap-decision” nature—the restraints of time and price make thinking too long about a spot quote unprofitable. And do keep in mind that spot quotes do expire within days or weeks. Make sure to be on your toes when requesting spot quotes from carriers that are new to your route or unfamiliar with your carrier requirements. This ambiguity can lead to excess costs, such as chargebacks, late fees, and others, which can compound the spot quote rate.

Lastly, while automatic spot rate quotes may seem like a convenient option, it is crucial to consider the factors mentioned above when choosing a freight forwarder for your shipping needs. Ultimately, working with a freight forwarder that understands your needs, and provides personalized support and customized shipping solutions is often a critical ingredient of an optimized supply chain.

Chat to us today concerning your digital freight forwarding needs, call us +61 2 9773 1378 or email info@imageinternational.com.au for a competitive quote.