The structural problem
Liner companies have to negotiate feeder and haulage rates with vendors across every region they serve. In Asia alone, the number of feeder and haulage providers is large and growing. Interfacing with each vendor one-to-one to obtain rates is a laborious process — and the manual nature of it gets in the way of the transparency that both the carrier and the vendor actually need.
Under the theme of corporate responsibility and sustainability, regulators have introduced anti-corruption and financial initiatives into liner business. While many carriers are using traditional e-procurement systems for control, none of these systems addresses today's complete spectrum of vendor tender management requirements end-to-end.
The failure modes of manual tender processing
Look closely at a typical liner's tender workflow and you'll see a recognisable set of failure modes. None of them are people problems — they all stem from running an inherently structured process on unstructured tools.
- Difficult to manage the tender life cycle from invitation to award
- Difficult to handle the version and revision of each tender quote
- No transparency in feeder and haulage rates
- Difficult to analyse vendor quotation cost across dozens of submitters
- Challenges in estimation of data — what does each line really cost over a year?
- Difficult to compare quote prices across different vendors with different formats
- Difficult to make a defensible strategic decision
- Difficult to select the best vendor consistently across regions
Why manual tendering hits the P&L harder than expected
Liner organisations have, in the last 20 years, committed substantial resources to developing financial and commercial management systems. Far less focus has been given to developing and managing vendor tender systems. Feeder and haulage business needs the capacity to make this commitment — otherwise significant time and resource are wasted, and choosing the wrong vendor undermines customer service and inflates the cost base.
Feeder and haulage cost constitutes a considerable share of overall liner operating cost. Many carriers still rely on Excel files to process and manage quotations from feeder and haulage vendors. Manual tender process plus mail management for numerous vendor quotes is tedious and time-consuming. Each quote has to be analysed for port and terminal pairs, equipment type, services, capacity, availability, frequency of calls, vessel calls, surcharges, exceptions, weight slabs, out-of-gauge cargo, hazardous cargo acceptability — across every vendor, every region.
“Deliver transparency to both the liner organisation and the vendor.”
Six reasons to make this a strategic priority
Carriers that prioritise vendor tender management report immediate, tangible financial gains — and the suppliers report a more transparent experience too. The drivers for moving from Excel to a real platform are concrete.
- Create value through increased transparency
- Manage the complex business environment, including tender volume
- Manage multi-sector tenders on a single unified platform
- Expand control to cover all geographical locations and optimise cost
- Standardise the global procurement process
- Gain insight into tender price negotiation history
What the right platform actually does
Compared to most commercial processes, managing a tender is one of the most intricate and unique workflows inside a liner organisation. It's difficult to guarantee best results when operating manually or without specifically designed tools. When selecting a vendor tender management system, the discipline is matching capabilities to actual workflow needs, not buying generic e-procurement and hoping.
“Efficient tender is a key business development strategy in the growth and success of many of today's businesses.”
- Unified haulage/feeder tendering across different regions
- Tender analysis, negotiation and vendor profile ranking
- Feeder/haulage tender maintenance and statistics
- Tender quotes captured with auto-comparison across vendors
- Tender evaluation and performance reports
- Forecasting for demand and decision-making information
- Simulation of annual feeder/haulage cost based on budgeted volumes
SVM Vendor Tender System — what this looks like in production
SVM Vendor Tender System handles the entire tender life cycle — invitation to award — on a single unified platform. The core objective is to receive and process tenders accurately and on time from every vendor, then process them automatically against the carrier's vendor-selection criteria.
The system covers multi-sector tendering on the same platform, with built-in modules for cost analysis, vendor management, process management, data management, vendor evaluation and selection, vendor ranking, statistical intelligence, and scenario building. Because of the transparency it creates, the carrier can view bid prices submitted against each tender — avoiding informal vendor activity and supporting better-negotiated outcomes.