When managing inbound transportation, the routing guide is key to success. Because it defines the rules of engagement between vendors and customers, a routing guide must be detailed, providing a solution for every transportation situation. At the same time it must be easy to read, simple to use, and flexible. Your vendors and customers will be more apt to comply with a guide if it clearly spells out cost savings and route parameters.

Here are 10 tips on creating a successful routing guide from Alan Miller, president, RoutingGuides.com.

Organize current and future shipments by origin and destination. Turn to your company's vendor and customer files and identify origin and destination points in your entire distribution network. You can create something as simple as a state-to-state matrix or as complex as a nine-digit ZIP-to-ZIP matrix.

Identify and chart the price/service capabilities and limitations of each carrier, consistent with your desired level of service and cost. Know your carriers' strengths and weaknesses. Some carriers are good at transporting perishables, while others may provide the best service, but only to certain locations. There are as many capability variables as there are carriers. Your routing guide should communicate the possibilities and where to access the best value for every transportation dollar you spend.

Identify shipment size, frequency, modal requirements, special needs, and transit time. Know the makeup of your shipments and the variables for time in transit. Identify weight groupings and service/modal requirements that apply to each group. Typical weight groups are:

Service/mode requirements can vary from overnight delivery to two-day, three-day, or three-to-five day service, and include air, LTL, truckload, rail, and ocean options. You may not want to provide a standard routing for overnight shipments weighing more than 5,000 pounds, nor would you provide a routing for ocean shipments weighing less than 70 pounds. Additionally, for shipments less than 5,000 pounds, there may be an opportunity to consolidate the shipment with others before it is moved.

Pay attention to your commodity mix and identify susceptibility to damage, contamination, heat and cold, etc. You may also have to make provisions if some commodities cannot be shipped with others.

Identify consolidation opportunities and weight breaks that support your price/performance needs. All too often, shipments are arranged as they come in from sales or order processing. A basic rule in transportation is that volume dictates discounts from carriers. If your shipments can be consolidated, you will receive better service and rates. Take a look at your carrier rates. In many cases you will find one carrier that offers lower pricing for smaller shipments, while another offers lower pricing for larger shipments.

Create a cross-functional matrix that considers all possible variables in Tips 1-4 but keep it simple. This is a basic what-if matrix that leaves the decision-making responsibility with you -- where it belongs. If you give vendors the flexibility to choose carriers for you, they will almost always choose carriers they prefer, not ones with which you negotiated the best rate or service. Lack of control is the leading cause of freight rate exceptions, documentation errors, and non-compliance.

Keep your routing guide simple so that your vendors and other users can easily obtain the information they need. Create a mechanism for exceptions handling that fits within your current business processes. You need a mechanism to provide routing assignments and rules for unforeseen circumstances you cannot account for. Create a contact form or shipment authorization form that your suppliers can easily execute. Then they can easily provide you with the information you need to select a carrier that satisfies your requirements.

Create rules. Your rules should identify the general and specific guidelines for conducting business with your company. They should spell out everything necessary to maintain or improve the efficiency of your receiving, putaway, inventory, and accounts payable and receivable processes. Specify requirements for marking, labeling, tagging, bar coding, bill of lading preparation, garment-on-hanger shipments, direct-to-floor merchandise, pallet specifications, contacts, purchase order guidelines, hazmat, and back order processing.

Distribute your guide wisely. Print only the number of copies you require so that all recipients have access to the information they need. Make sure each routing guide has a clearly stated security requirement clause and ramification for violations that compromise your company's competitive privacy. Copies in the wrong hands are a potential security problem. Know where every copy is at all times.

If a vendor informs you that it has misplaced your routing guide, or that parts are missing, be very concerned. The details in your guide can include highly confidential information and should not be available to just anybody. All too often, a vendor misplaces a routing guide, or has it open or available when your competition is in the office.

Create communications around your guide. Mail each routing guide with a signed delivery confirmation and a return receipt or fax acknowledgement form. Follow up with a telephone call to review aspects of the guide that might be confusing. Share comments about your routing guide with users, particularly where they pertain to exceptions that can improve your supply chain. Keep notes of these exceptions for future updates.

A signed confirmation is not just a security function. Confirm that every vendor has the most recent edition of your routing guide available for reference when it is time to make a transportation delivery decision. Don't tolerate the excuse that a guide was not available.

Plan to repeat this process in four months or consider simplifying the process by taking it online. Your routing guide is not static. You negotiate a lower rate. You find a more efficient transportation alternative. A carrier goes on strike. A usual route or highway is closed or is prone to congestion or accidents. There are many reasons to continually revisit your routing guide.

If you work with old-fashioned paper guides, you know this is also an expensive, ongoing compilation and printing project. If you have changed over to an electronic version you can make changes as they occur so your routing guide is always current, secure, and ready for full compliance.