Written by Tim Dennis – Solution Consultant, Precision Software
“The only constant is change” – Heraclitus (535 BC – 475 BC)
When you select a solution provider to help ship your goods, you are not only selecting the look, feel, performance, reputation, flexibility and support of their solution. You are also selecting their ability to provide the carriers that your organization uses to ship its goods and to provide options for expanding your capabilities by adding additional carriers, services and countries of origin. You explore the carriers your solution provider has available, which services are offered and in which origin countries. Luckily, a very good portion of the time, the provider already offers the carriers and services you need. However, there are times that the provider does not have specific carriers onboarded and ready to leverage.
This article focuses the process of Carrier Onboarding. We will discuss the available options for adding new carriers, new services and new origin locations.
The term Carrier Onboarding, within the Transportation Management / Shipment Execution System solution provider space, refers to the process by which a new carrier, service or geography is added for their customers to leverage. The following information is typically required when a carrier is on boarded:
– Carrier record (establishes unique carriers in the TMS solution)
– Carrier full name
– SCAC code and/or global carrier code
– Customer internal carrier “Ship Via” code
– Account number
– Carrier services (e.g. next day, 2nd day or ground shipping)
– Tracking number generation
– Carrier rates
– Negotiated rates – your specific rates per your carrier contract
– Customer rates – rates that reflect what you charge customers (optional)
– Accessorial charges (e.g. fuel surcharges)
– Routing guide
– Geographical data that describes the area for which each service is provided
– Transit times
– Typically differentiated by service level and geography served
– Certified/accredited shipping labels
– Optional, but often a requirement to ship via a carrier
– End of day manifest/carrier close out file(s) generation, reports and transmission
Options for Carrier Onboarding
There are several methods used to onboard a new carrier. Below, the three most typical methods and their pros and cons are highlighted.
Web Service API – Application Programming Interface
With this method, the solution provider builds a connection to your carrier. This allows them to pass transactions over and receive rates directly from the carrier. The carrier maintains your rates, accessorial charges, routing guides, transit times, tracking numbers and shipping label formats on your behalf. The web service API can, and often is used for end of day manifesting/carrier close out file transmission. For some carriers, this is the only method by which they can be integrated to a solution
– Web service API integrated carriers can be quickly onboarded if the carrier provides support for a web service API interface and your TMS solution provider can implement a change within their application that can use the web service API.
– Rates, services, routing guides, transit times, tracking numbers and accessorial charges as well as shipping labels are always kept up to date and are maintained by your carrier.
– Your solution provider and carrier(s) maintain the web service API and your carrier maintains their systems for your usage.
– While your solution provider and your hardware configuration can be optimized for high speed processing, you do not have any control of how quickly the carrier’s system responds to the web service API call.
– Speed of processing – leveraging web service API calls for carriers, while convenient, may not satisfy you response time requirements and give you the speed you need in a busy shipping environment.
– Reliability of processing – although infrequent, carrier systems do go down or become unresponsive. Issues such as a network problem, outage or maintenance could severely impact your ability to ship. From our investigation, published data for carrier system uptime percentages or web service API average response times were not available from the carriers themselves, TMS solution providers or credible analysts.
With this method, your provider builds and maintains the rates, accessorial charges, services, routing guide, transit times, tracking numbers and shipping labels and you license or subscribe to this data for usage in your system. Your TMS solution provider may create or modify system programs and end of day/carrier close out manifest process. This approach to carrier onboarding typically requires more effort from your TMS provider, however most TMS solution providers offer some form of easy onboarding processes or procedures that formalize onboarding with definitive and accurate time frames and cost values.
– Speed of processing – leveraging internal system logic to read and process data from within the database is very fast and efficient. In our own benchmark studies of how fast this can be, the results were shocking with several tens of thousands of transactions being processed per hour.
Batch Results – Multiple Packages
– Reliability of processing – if your TMS solution is up and running on appropriately sized and functioning hardware, you should be able to process your shipments for carriers that are not configured to use web service API calls. If you are running in an on-premise environment on your own hardware, you could even process without an Internet connection.
– It takes time for your TMS solution provider to work with you and your carrier to acquire the data, build the logic in the solution, load the data, test the programming, get shipping label certification and deploy the carrier to your environment.
– Cost could be a downside of this approach as well. Some TMS solution providers either charge (or cost share with) their customer for onboarding a new carrier using this method. Which means that adding multiple carriers can become expensive.
Manual Entry or File Create and Load
Your TMS solution likely has a utility that allows you to enter carrier rates, accessorial charges, services, routing guide and transit times into the system by hand. Most TMS solutions enable you to create comma separated value (CSV) files or spreadsheets in various formats to load this information to your system.
– This process can be the least expensive of the options available to a customer. If onboarding a small carrier with very simple data to capture for rates, accessorial charges, services, routing guide and transit times it could take just a few minutes or hours to accomplish manual entry.
– The data, once entered into your system, would process with the same speed and reliability as stated above for the system-integrated method.
– This oftentimes is the most time consuming and expensive option available. If you are onboarding a large carrier with a complex rate structure, multiple complex accessorial charges, numerous services, with routing guides and transit times it could take days, weeks, even, months to enter all of the data into your system. Updates to the data for a complex carrier could be as much of a nightmare as entering the data. Even with the loading of data from CSV files or spreadsheets, there could be much effort expended in testing the data for accuracy.
The “Right” Approach
Some carriers provide options to obtain their data either via web service API or system integrated. Weighing the pros and cons above, should help you choose the right option for you.
If you are a high volume shipper onboarding a mission critical carrier, perhaps web service API shouldn’t be your first choice as it will be slower to process than the other options presented in this document. If you are a low volume shipper, choosing a carrier web service API approach might be the best option for you if you can accept the processing speed and reliability concerns. Ideally, you want a TMS solution provider that supports all three types of carrier onboarding we discussed because:
- Some carriers only provide web service API access.
- Some carriers do not provide web service API access.
- Some carriers provide either web service API access or system integrated data; in this case your decision should be based on processing speed and reliability factors.
- Some carriers are small and are not complex and don’t require the use of either web service API or system integrated approaches. Manual entry or file create and load would be a great option.
The PRECISION solution provides access to an industry-leading global parcel carrier network. As customers bring us into new geographies and industries and as carriers introduce new services and origins, this network continues to expand through our Carrier Onboarding Program. The vast majority of parcel carriers have specific requirements that must be met for the integration of their technology to PRECISION and each carrier has an accreditation process that must be completed before a customer can start shipping.
The key to our approach is to ensure that there is agreement between all parties: the carrier, the customer and the solution. This may seem straightforward, but with the myriad of carrier services that are offered across origin countries, this is not always the case. Our framework ensures that this information is clearly defined and agreed upon up front.
Our dedicated team of solutions consultants have decades of experience to help you examine your current processes, leverage industry best practices and provide a roadmap to help you achieve your objectives in an time and cost efficient and comprehensive manner. Contact us today!