User Experience Insights
SAP Business Network for Logistics – Understanding the Freight Order Collaboration Process
SAP Business Network for Logistics (BN4L) provides collaboration capabilities for shippers running SAP Transportation Management (TM) and their carriers – freight tendering, subcontracting, settlement, tracking and dock appointment scheduling can all be collaborated on. SAP TM supports two main objects, Freight Orders – for Road and Rail (BN4L support for Rail is planned for 2024), and Freight Bookings for Ocean and Air. This blog will focus on the Freight Order collaboration process on BN4L and cover some important things to know about our SAP terminology, impacts on carrier integration, and more.
Freight Order Collaboration Process Overview
Below you see a slide describing the Freight Order API Process Flow for Road Tendering and Contracting. Please note: our carriers do not need to develop the below integration, they can use the portal, integration is optional.
This is where some confusion comes in due to our naming of Freight Tendering (process shown in purple above) and Subcontracting (process shown in blue). What we call Freight Tendering is our Request for Quotation process. The industry in North America considers the phrase Freight Tendering to be what we call Freight Subcontracting. I can’t tell you how many calls I’ve been on with Carriers where this naming has caused a ton of confusion.
Freight Tendering Collaboration
Freight Tendering (AKA Request for Quotations, AKA Spot Bids) is an optional process that our Shippers running SAP TM can turn on and configure. Many Shippers do not use Freight Tendering and go straight to Freight Subcontracting since they already have contracted prices in place for all their lanes.
During this process a request for quotation is sent to the carrier (or Carriers, there are many options the Shipper can choose to configure). The Carrier can then respond to the quotation and if enabled provide a price they are willing to transport the goods for. The shipper can then evaluate the received bids and award / reject accordingly. If the carrier is awarded the quotation, the next step in the process is the Freight Subcontracting flow described below and shown in the above process flow.
Important Carrier Integration Note: EDI does not support our Freight Tendering process, only API is supported. Why may ask? Because this process was invented long after the development of EDI for road, and the EDI governing bodies haven’t gone back and added support for quotes.
Freight Subcontracting Collaboration
Freight Subcontracting is a mandatory process that the industry knows well, where a Freight Order is sent to a Carrier and they in turn can respond with a confirmation or rejection. In addition, the Shipper can send a cancelation of the Freight Order at any time during this process.
Important Note for Carriers: You can confirm the order multiple times and provide more information each time. For example, maybe you want to confirm the Freight Order right away so the Shipper is aware you will be transporting the order, and then later on confirm it again with the Driver Name and License Plate.
Important Carrier Integration Note: Freight Subcontracting supports both EDI (204/990 in North America, EDIFACT elsewhere) and API integrations.
Freight Order Collaboration Curveball
OK, now you understand the Freight Order Collaboration Process on BN4L. Now, get ready for a curve ball! Remember above where I write SAP TM and BN4L support Freight Bookings for Ocean and Air? That part is 100% true. BUT!!!! Some Shippers decide for a number of different reasons to use the Freight Order object for Ocean and Air. While the Freight Order is not designed for Ocean and Air it is possible to use it to support these modes of transportation. The functionality isn’t nearly as robust (no support for pre and post carriage legs is just one example of that), the basic underpinnings can support some Shipper to Carrier collaboration for Ocean and Air. This is very important for Carriers to understand, especially if they are being asked to build an integration.
- SAP TM Freight Order object was designed for Road and Rail shipments and Freight Bookings are designed for Ocean and Air shipments.
- Freight Tendering is the Request for Quotation process also known as Spot Bids and is supported in combination with Freight Orders.
- An optional process the shipper can turn on and configure.
- Carriers can only integrate with API.
- Freight Subcontracting is the standard request / confirmation process shippers and carriers are used to.
- Carriers can choose to integrate with API or EDI.
- Some Shippers use Freight Orders for Ocean and Air.
Understanding the overall process, terminology and yes, some potential curveballs, of the Freight Order Collaboration Process is the first stepping stone to a successful implementation of SAP TM + BN4L for both Shippers and Carriers.