Carrier management

What is carrier management in transportation?

Carrier management is the process of overseeing and controlling the activities, costs and performance of companies that provide the conveyance of goods, people or services. In transportation specifically, carrier management comprises a business's activities to monitor and manage the performance of transportation service providers or carriers.

Primary areas of carrier management in transportation include carrier performance scorecards, contract and rate management, carrier compliance and claims management.

Transportation modes (road, air, ocean, rail) often require carrier management activities specific to the transit method:

  • Ocean carrier management: for freight moved in cargo containers by ocean-going vessels, often internationally

  • Carrier management in trucking: manages and monitors shipments moving by full truckload or less-than-truckload (LTL)

  • Parcel carrier management: ensures shippers use the best small parcel carrier based on the shipment and contracted carriers

  • Final mile management: covers the difficult final phase of a freight shipment's transportation to its final destination, often requiring diverse delivery service levels

Modern carrier management in transportation relies on software that supports supply chain visibility via analytics, aids in critical business decision-making and improves collaboration with transportation carriers.

Carrier management systems

Carrier management systems are a piece of the overall transportation management system (TMS) platform. For shippers, a carrier management system:

  • Allows users to manage carrier performance and benchmark it against commitments

  • Tracks each shipment against delivery commitments and reports on performance

  • Empowers users to manage the entire shipment life cycle, from order management, carrier selection and tracing through financial settlement and reporting

Integrated with a TMS, a carrier management system provides shippers with immediate rate quotes from multiple carriers and real-time awareness of carrier service.

Carrier management systems also leverage technology for transportation service providers to manage equipment utilization, fuel price changes, evolving federal regulations and customer expectations.

Multi-carrier management software

Multi-carrier management solutions give parcel shippers access to a wide range of transportation carriers and services in one technology platform.

Software solutions help shippers identify the appropriate parcel carrier from contracted carriers. Selection is based on order characteristics (e.g., weight and dimensional properties), delivery rules (e.g., delivery time and zone), carrier performance and cost differences between service options.

Multi-carrier parcel management software supports the creation of shipping labels and shipping manifests, provides status messages to customers and manages carrier rates.

How technology supports carrier management

Carrier management capabilities, typically part of a broader transportation management system (TMS), help streamline monitoring and control across freight transportation activities:

  • SaaS-based management system: control user access for individuals or teams to manage carriers from any location

  • Automatically qualify and monitor carrier compliance: vet and qualify transportation providers to minimize risk at the carrier and load level, including compliance requirements for specialized loads such as temperature-controlled or hazardous goods

  • Communicate via carrier portal: interact directly with carriers without expensive application programming interfaces (APIs) or electronic data interchange (EDI)

  • Create carrier contracts: obtain carrier rates and generate contracts to streamline carrier selection for mini-bids or short-term contracts

  • Model new carrier contracts: see how new contracts and carrier relationships can improve throughput

  • Multimodal optimization and visibility: view and manage all assets across all modes and carriers to help ensure a positive customer experience

These capabilities typically extend to final mile transportation service providers as well, with additional benefits like automated alerts triggered by real-time events, dynamic rerouting based on changing conditions, customer appointment scheduling and data sharing across collaborators.