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From unstable freight pricing to supply chain volatility, the world of freight procurement has taken a few knocks in recent years. But there’s good news - teams are fighting back with innovative technology. More and more leaders are leveraging advanced solutions to navigate the ever-changing landscape, streamline operations, and get steps ahead of the market.MicrosoftTeams-image (61)

Powerful technologies looking to automatically generate the most optimized scenarios have turned to mathematics and combinatorial algorithms as their allies. But what are these capabilities and how can they help your team?

In this article, we’ll explore the roadblocks freight procurement teams are currently navigating and how implementing a Smart Optimization Engine in your processes can help remove them from your way.


The challenges and shifts in freight procurement today

The freight market is still weathering a unique set of challenges. How you address them can make or break your business’ performance and profitability. 


cost Market volatility and disruptions add pressure on costs:

Issues like inflation, rising fuel charges, and other unforeseen supply chain disruptions have created a vicious cycle of transportation challenges and higher costs. With fluctuating freight rates, increased shipping demand, and geopolitical disruptions to contend with, freight procurement teams are playing defense to secure quickly the best mix of options. As a result, it's hard to lock in optimal deals, which turns freight into a cost driver.  

flexibilityFragmented processes and a lack of digitalization hinder data-driven decision-making & time efficiency:

Huge volumes of data from scattered sources and decentralized insights create difficulties in building and analyzing predictive scenarios, sparking a reactive approach to market shifts. These problems are so common that 55.4% of shippers don’t use real-time data in their decisions, and 75% question their data accuracy. In today’s digital economy, manual processes still hold teams back and using solutions not built for the specifics of freight procurement restricts productivity and efficiency even more. Tasks that should take minutes take weeks and months to execute and operating on solutions that don’t integrate well with other platforms in the overall supply chain ecosystem leave teams to make risky guesses and waste valuable time and effort.

greenIncreasing sustainability requirements add additional complexity to decision-making:

Reducing CO2 emissions has become a key objective globally, with initiatives like the EU Commission’s Green Deal leading the sustainability charge in transportation. Yet, without the right tools, merging sustainability targets with other criteria and objectives, as well as measuring their impact is difficult. 


Stay ahead of the market with SHIPSTAOptimate - the Smart Optimization Engine

To ensure your team is able to overcome these challenges, let technology do the heavy lifting. Investing in a purpose-built freight procurement platform with a Smart Optimization Engine that incorporates automation and combinatorics/combinatorial algorithms is your best bet for long-term gains in freight procurement. 

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What is combinatorics and how can it level up freight procurement operations? 

Combinatorics is a counting-focused system hailing from mathematics. In freight procurement, combinatorial optimization and analysis harnesses the power of data and algorithms to help you automatically pinpoint the best mix of price, schedules, lanes, CO2 emissions and other criteria while meeting your specific needs for a certain scenario.

It allows you to set rules and integrate relevant criteria and different "weight" to ensure the results generated always match your company’s requirements and freight procurement strategy. Using such a capability, your team can slash the time it takes to assess and compare the mix of carriers, shipping options, service levels for specific criteria (e.g., cost, time, CO2 emissions) to find the best fit. 

Now that you’ve got an idea of what combinatorics in freight procurement looks like, the question becomes, “Is integrating combinatorial optimization a wise investment for my organization?”

The answer is a resounding “Yes!” and here are at least 4  ways in which this can give your team a competitive edge:  


1. Turn personalized insights into cost savings MicrosoftTeams-image (62)

As the saying goes, “data is king”. It’s essential to access and incorporate high-quality data at each stage of the freight procurement process. A standout quality of the Smart Optimization Engine is its data-synthesizing and automation capability, surfacing fast the best award scenarios given the multiple criteria inserted and translating into your team taking fast informed decisions that drive results like cost savings and efficiency. 





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2. Improve data transparency & negotiations at scale

To generate freight procurement scenarios and suggestions, combinatorial analysis brings together insights from multiple data sources, as well as your specific requirements and criteria. With access to a single source of truth and objectives reflected through data for better decision-making, the Smart Optimization Engine can help you move the needle in specific goals by incorporating them into your data analysis. E.g. if your company decides to prioritize sustainability and price, your team could simply operate the feature to show the best combinations focusing on these criteria and different percentages of importance.




3. Reduce time & effort spent on analysisMicrosoftTeams-image (64)

Leveraging the Smart Optimization Engine built on the power of combinatorics, on a purpose-built, centralized freight procurement solution isn’t just great for analyzing data and figuring out the best possible alternative to go with, it's also useful for connecting all aspects of your freight process. This feature turns your business into a data powerhouse by creating a bridge between your data insights and execution, significantly reducing manual effort and complexity. 





MicrosoftTeams-image (65)4. Improve supply chain agility

In today’s volatile market, having the ability to foresee challenges and shifts and then pivot quickly is key to keep your freight procurement strategy relevant and effective. The Smart Optimization Engine will give you foresight into the mix of key levers such as pricing, speed, capacity, transport mode, CO2 emissions across multiple carriers and scenarios so you can quickly adjust your approach.





Combinatorial algorithms can really supercharge your team’s performance and results. But for long-term success, it’s essential to implement them the right way. Skip over manual efforts or generic tools which can be time-consuming and costly. Instead, select a freight procurement solution embedded with combinatorics as an asset in its arsenal.  

Wondering how SHIPSTA's Smart Optimization Engine looks like in practice and how it can help your business?

Reach out, our team is looking forward to showcasing it to you.