In logistics, the issue of transportation costs is always acute. Shippers want to pay a fair price, while carriers want to make money and not operate at a loss. But what is the “market price”? It is the balance between supply and demand at a specific moment, for a specific route, taking into account all conditions.

In practice, finding this figure is more difficult than it seems. After all, the “market price” is not written in a reference book — it must be determined using tools that help compare carriers' offers. The most common method is tenders.

Why it is difficult to determine the real price

The logistics market is not a stable price list, but a living system. Pricing is influenced by:

• seasonality (for example, rates increase during harvest time),

• destination (it is difficult to find a vehicle in “hot” regions),

• type of cargo (refrigerated trucks are more expensive than covered trucks),

• level of risk (special conditions are required for dangerous or expensive cargo).

Therefore, agreeing “verbally” with one carrier is risky. The price may be overestimated or underestimated. In the first case, you overpay, in the second, you risk being left without transport.

Tenders

Why is it difficult to understand the real price without tenders? When an order is placed directly through an acquaintance or by phone, several problems arise at once: you do not see the market as a whole, there is a risk of overpaying, and there is no certainty that the rate is fair for this particular route or type of cargo.

A tender solves these issues. It collects several offers, allows you to compare them, and choose the best one. This is how the market price is formed, rather than an amount dictated by random agreements.

Basic tender formats

Classic tender. All participants see the competitors' rates. The lowest or most advantageous offer wins.

• Advantage: the “average” price is quickly determined.

• Disadvantage: dumping and subsequent refusal to perform the flight are possible.

Closed tender. Only the shipper sees the offers.

• Advantage: avoidance of manipulation between carriers.

• Disadvantage: more difficult to analyze if there are few participants.

Blind tender. The purest format. Carriers do not see each other's bids, and the shipper receives independent, honest offers.

• Advantage: a real market snapshot is formed. Attention is paid not only to price, but also to the carrier's terms and conditions.

• Disadvantage: the results need to be analyzed more carefully.

Classic tender: transparent, but with nuances

A classic tender involves the customer submitting a transport request and carriers submitting their offers. It is convenient because:

• you can get several bid options at once,

• it is easy to compare the terms and conditions of different companies,

• a database of verified partners is formed.

But there is also a downside — participants see their competitors' rates and can “adjust” their offers accordingly. This does not always give a real market price, because someone may deliberately lower their rate to win and then refuse to perform the trip.

Blind tender: fair competition

To avoid “bidding wars,” a blind tender format is used. Its distinctive feature is that carriers cannot see the offers of other participants.

This creates several advantages:

• everyone offers a bid that they consider realistic and profitable,

• there is less manipulation and “nerve-wracking bargaining,”

• there is a greater likelihood of obtaining the true market price.

This approach is especially useful when a company enters a new market or direction and has no benchmarks for rates.

Blind tenders: the most accurate market barometer. 

This format is especially useful in situations where:

• you are entering a new route and do not know how much it should cost;

• you are working with a new type of cargo (e.g., dangerous or temperature-sensitive), where rates vary significantly;

• you want to avoid “price wars” and get offers that reflect the real costs of carriers.

A blind tender allows you to move away from psychological games and get an honest picture of the market. It is a tool for those who want to see the true cost of logistics.

Auction: speed and drive

Another format is an auction. It can be open or restricted. Participants gradually lower their bids in an attempt to win the flight. It is fast, dynamic, and works well where demand exceeds supply.

But there is a risk that the carrier will “overplay its hand” and set a bid below cost. As a result, it will either refuse to transport or try to save on service.

Long-term contracts 

In addition to tenders, prices can be formed in two modes:

• Long-term contracts. You fix the rate for a certain period (for example, six months or a year). This is convenient for stable routes, but risky if the market changes dramatically.

• Spot market. Here, the price is determined at the moment. You are looking for a vehicle for a specific trip, and the rate is set based on the situation “here and now.” It's fast, but can be more expensive if demand is high.

How to choose the right format

There is no universal answer — it all depends on your needs.

• If you have regular routes, consider long-term contracts.

• If you are looking for balance and fairness, use blind tenders.

• If speed is important, an auction or spot market is suitable.

• If you need choice and comparison, a classic tender is the best option.

• It is best to combine different formats. This allows you to respond flexibly to the market, get a real market price, and at the same time build relationships with reliable carriers.

Conclusion

Finding the true market price is not about “knowing the number by heart,” but about having the tools that help you see the picture from different angles. Classic tenders, blind tenders, auctions, spot markets, and contracts are all pieces of the puzzle that make up transparent and efficient logistics.