Programmatic Negotiation: The Quiet B2B Revolution

Programmatic negotiation is transforming how businesses handle B2B logistics. Instead of relying on manual, time-consuming processes, companies are now using automated systems and real-time data to manage contracts, pricing, and partnerships. This shift is especially important for direct-to-consumer (DTC) brands and eCommerce operators who need faster, more efficient ways to scale their operations and meet market demands.

Key Takeaways:

• Faster Negotiation Cycles: Companies are moving from annual pricing discussions to monthly or quarterly adjustments, driven by automation.
• Real-Time Data: Automated systems use live data to make decisions instantly, improving flexibility and reducing delays.
• Cost Savings: Dynamic pricing, automated rate comparisons, and performance-based contracts help cut shipping and logistics costs significantly.
• Scalability: Automated workflows handle growing order volumes and geographic expansion without adding complexity.

For DTC brands, programmatic negotiation is no longer optional - it’s a necessity to stay competitive in today’s fast-moving markets. By integrating advanced tools, these businesses can streamline logistics, reduce costs, and maintain strong supplier relationships, all while meeting rising customer expectations for speed and reliability.

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How Programmatic Negotiation Works

Programmatic negotiation brings automation to the intricate world of B2B logistics, connecting various systems to streamline and optimize the negotiation process.

Automated Negotiation Workflows

With programmatic negotiation, pricing, contract terms, and service levels are automated through predefined rules and triggers. These workflows ensure tasks and information are routed seamlessly between parties based on specific conditions.

For example, systems can handle complex logistics like delivery schedules, handling requirements, and performance penalties. Imagine a direct-to-consumer (DTC) brand scaling from 1,000 to 10,000 shipments per month. Automated workflows would instantly adjust pricing tiers, update service commitments, and reallocate capacity across multiple third-party logistics (3PL) providers.

Platforms like Vector Shipment Cloud and UPS's ORION system demonstrate how effective this automation can be. Vector’s electronic bills of lading (eBOL) and automated check-in systems save over 30 minutes per load. Meanwhile, UPS's ORION leverages machine learning to optimize delivery routes by considering factors like traffic, weather, and package weight, resulting in significant fuel savings and improved delivery efficiency.

Unlike manual processes that might take days or weeks, automated systems can make adjustments in minutes. This speed eliminates the variability of human intervention, while real-time data ensures decisions are informed and immediate.

Real-Time Data and Analytics

Real-time data analytics eliminates the delays between data collection and decision-making. This allows businesses to react instantly to market changes, adjusting pricing, capacity, and service levels based on current conditions rather than outdated reports.

Companies like Reddit and Adikteev use real-time analytics to optimize operations. For instance, Reddit employs tools like Apache Druid and Imply to process data directly from Kafka and their data lake, enabling advertisers to make informed decisions in real time. As Shariq Rizvi, EVP of Ads Monetization at Reddit, explains:

"By using Apache Druid and Imply, we can ingest multiple events straight from Kafka and our data lake, ensuring advertisers have the information they need for successful campaigns in real-time."

Similarly, Adikteev uses these tools to improve decision-making and alert clients to potential issues before they arise. Margot Miller from Adikteev notes:

"By using Druid and Imply for real-time self-service analytics instead of relying on slow and stale dashboards, we have been able to achieve both internal productivity gains and faster decision-making. We're also able to provide our customers with the data they need to improve the performance and effectiveness of their retargeting campaigns and notify them of potentially serious threats to their business - often days before the client would have noticed it themselves."

For DTC brands, this means spotting supply chain issues before they disrupt deliveries. Real-time data enables automatic adjustments to fulfillment routes or inventory positioning and supports dynamic pricing strategies that respond to demand, capacity, and regional conditions.

Technology Requirements

To make the most of automated workflows and real-time analytics, a strong technological foundation is key. Programmatic negotiation relies on systems that integrate data, APIs, and various platforms. This often involves bridging traditional EDI systems with newer API-driven processes.

Cloud computing plays a central role, enabling real-time collaboration across all stakeholders. The logistics industry is heavily investing in these technologies, with digital transformation in logistics expected to reach $75.5 billion by 2026.

Key technology components include:

API connectivity ensures seamless data exchange between platforms, pulling information from warehouse management, transportation management, and financial systems. Machine learning enhances decision-making by analyzing historical data to recommend optimal pricing and strategies.

Henkel’s 2023 modernization project highlights the scale of investment needed. The company spent $70 million upgrading its Bowling Green hub, increasing storage capacity by 56% and enabling the facility to process 1,000 trucks daily - an 80% improvement. Integrated automation and digital tools allowed real-time data exchange, streamlining operations.

Security and compliance are also critical, as 89% of organizations see supply chain disruption as a major risk to growth. Technologies like blockchain enhance transaction transparency, while IoT devices provide real-time tracking for better visibility.

GPS and IoT-enabled devices are particularly valuable for dynamic negotiations. If a shipment is delayed, the system can automatically adjust delivery commitments and pricing to reflect the new service level.

Thomas Jorgensen, President & CEO of Green Worldwide Shipping, sums it up well:

"Warehouse automation - including robots, self-driving machinery, tracking codes, and automated storage and retrieval systems - has achieved significant efficiencies and cost savings."

While the technology demands may seem extensive, they are becoming standard for businesses aiming to stay competitive in logistics.

Benefits of Programmatic Negotiation for DTC Brands

Direct-to-consumer (DTC) sales by established brands are projected to surpass $186 billion by 2025, while digitally native brands are expected to hit $40 billion within the same timeframe. To capitalize on this growth, programmatic negotiation offers DTC brands the tools they need to improve efficiency, manage costs, and scale operations effectively. These advantages are particularly evident in streamlined operations, reduced costs, and enhanced scalability.

Improved Operations

Programmatic negotiation takes the guesswork and delays out of logistics, automating processes to reduce errors and speed up response times. This automation allows brands to adapt quickly to market demands and shifting customer expectations. In fact, 54% of DTC supply chain executives are actively investing in technology to lower fulfillment costs.

By leveraging automated performance tracking, brands can maintain consistent service quality with logistics partners. Additionally, analyzing customer purchasing data helps predict demand more accurately and optimize inventory levels. This precision is crucial when 69% of consumers are willing to switch to a competitor if a purchase isn’t delivered within two days of the promised date.

"During the summer [of 2021], we had some stock level issues that prompted me to look at the correlation between our general conversion rate and out-of-stock percentage. Let's just say those two things are strongly correlated in our business." - Sean McGinnis, President of KURU Footwear

Another key benefit is the transparency programmatic negotiation brings. Real-time visibility into the logistics network allows brands to address potential problems before they escalate. This proactive approach not only improves service delivery but also sets the stage for meaningful cost savings.

Lower Costs

Cost management is a top priority for DTC brands, and programmatic negotiation delivers immediate savings. Strategic rate shopping alone can cut shipping costs by 2-20% per shipment. For brands managing thousands of orders each month, these savings can quickly translate into significant financial benefits.

Dynamic pricing ensures brands secure the best rates based on current market conditions. Performance-based partnerships with third-party logistics providers (3PLs) ensure that brands only pay for measurable results. Other cost-saving strategies include:

• Distributed fulfillment to lower last-mile delivery costs
• Bulk shipping discounts through automated consolidation
• Optimized packaging to minimize dimensional weight fees

"If you're treating rate shopping like a 'set-it-and-forget-it' tool, you're diminishing profits on each DTC transaction." - Joe Henderson, Deposco

Real-time freight tracking further reduces costs by rerouting shipments to avoid delays and surcharges. For brands expanding internationally, programmatic negotiation optimizes duties and taxes by selecting the most economical shipping methods and customs processes. Enhanced returns management also cuts costs by automatically routing returns to localized centers, reducing both shipping and restocking expenses.

Scalability and Multi-Region Fulfillment

As DTC brands expand, the ability to scale operations without increasing complexity becomes essential. 82% of DTC supply chain executives anticipate growth of 10-25% in the next 12 months. With automated workflows and real-time analytics, programmatic negotiation efficiently manages higher order volumes while maintaining operational simplicity.

For multi-region fulfillment, the system selects the most cost-effective carriers and fulfillment centers based on factors like inventory location, shipping costs, and delivery timeframes. This approach ensures seamless operations across geographic regions. Notably, 91% of e-commerce leaders report profitability from international sales, with nearly half attributing 20% or more of their revenue to global markets.

The platform also simplifies international logistics by handling cross-border shipping, customs compliance, and regional carrier coordination. Looking ahead, 94% of global e-commerce leaders plan to expand in-country fulfillment within the next five years. As brands diversify their product offerings and enter new markets, programmatic negotiation adjusts logistics strategies to meet evolving shipping and delivery needs, ensuring smooth and efficient growth.

How to Implement Programmatic Negotiation

Shifting from manual to programmatic negotiation requires careful planning that spans across technology, workflows, and supplier relationships. This transition builds on the automated processes and data-driven strategies previously discussed, ensuring everything aligns smoothly.

Step-by-Step Implementation Process

Start by setting clear objectives with measurable goals, like cutting down negotiation cycle times or reducing logistics costs. These goals act as a guide for decision-making and provide benchmarks to measure progress.

A dedicated transition team is essential to coordinate efforts across departments. This team should include logistics managers, IT experts, procurement staff, and other key stakeholders who understand both the current processes and the desired future state.

Process mapping is the foundation of implementation. Collaborate with your technology provider to document existing workflows, pinpoint integration points, and define key performance indicators (KPIs). This ensures that automated tools align with your business goals while maintaining operational stability.

During the technology integration phase, connect programmatic tools to existing systems like ERP platforms, carrier management tools, and financial software. Use APIs and real-time data sharing to ensure seamless connectivity.

Implement changes through a phased approach to minimize risks. Start with a pilot project, gather feedback, and refine the process before rolling it out fully.

Key Success Factors

Beyond the implementation steps, several factors are critical to sustaining the benefits of programmatic negotiation.

Data quality and governance play a pivotal role. Automated systems rely on accurate, real-time data to make informed decisions. Companies with strong data governance protocols report a 55% reduction in data fragmentation issues, leading to better negotiation outcomes.

Internal alignment is crucial to avoid conflicts and ensure smooth adoption. Departments like logistics, procurement, and finance must understand how programmatic negotiation affects their roles. Clear communication about responsibilities and benefits helps build support for the transition.

A robust change management strategy addresses the human side of adopting new technology. Bob Daymon, Head of Client Services at Uber Freight, emphasizes:

"You have to have a very robust and engaged change management strategy. There will always be some dissatisfaction along the way - and a change management strategy will shrink the time you're in that valley".

Supplier collaboration is equally important. Suppliers may need training to adapt to new systems and workflows. Offering comprehensive training programs to suppliers, factories, and business partners ensures smoother adoption and better outcomes.

Performance monitoring systems are key to tracking progress. Regularly analyze negotiation outcomes, cost savings, and operational efficiency to fine-tune the programmatic approach. These systems also help identify potential risks and challenges early on.

Practical Tips for Logistics Teams

Before diving into programmatic negotiation, clean and standardize your logistics data. With 89% of organizations struggling with data integration, this step is critical for success.

Choose technology partners wisely. Look for partners who offer not just the right features but also expertise, scalability, and ongoing support. A good partner will provide system updates and industry insights that go beyond the initial setup.

Use solid, reliable data to form the foundation of your negotiations. Leverage industry-standard benchmarks and historical trends to inform automated strategies.

Follow the 70/30 rule: spend 30% of the time communicating and 70% gathering feedback from team members, suppliers, and customers. This helps address issues early and builds trust in the new system.

Develop backup strategies to maintain flexibility. For instance, consider expanding your pool of transportation brokerage partners to ensure options are available when automated negotiations don’t yield ideal results.

Monitor metrics continuously instead of waiting for quarterly reviews. Keep an eye on cycle times, cost savings, supplier satisfaction, and system uptime to ensure the programmatic approach meets expectations.

Finally, maintain transparency with both suppliers and internal teams. Be upfront about timelines, expected changes, and the support available during the transition. Open communication helps everyone adapt more easily.

Implementing programmatic negotiation can transform logistics operations, but success lies in thorough preparation, strategic execution, and ongoing adjustments. Teams that follow these structured steps - and remain open to feedback - are more likely to achieve strong results from their initiatives.

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Forthmatch: Enabling Programmatic Negotiation

Forthmatch is changing the game for DTC (direct-to-consumer) brands by simplifying and streamlining 3PL (third-party logistics) negotiations. Gone are the days of dealing with brokers, filling out complex quote forms, or navigating unclear pricing models. Instead, Forthmatch provides direct access to a network of vetted logistics providers, offering complete pricing transparency and eliminating unnecessary delays. Let’s explore how Forthmatch stands out in the logistics landscape.

Key Features of Forthmatch

Forthmatch equips users with tools that make logistics sourcing smarter and faster:

• Real-time service area maps: With isochrone and isodistance displays, brands can visualize service areas and filter results by region, specialty, and platform integration.
• Advanced filtering options: Whether you need Shopify integration, Amazon FBA support, or WooCommerce compatibility, Forthmatch helps you pinpoint providers that meet your exact technical needs.
• Unbiased rankings: Providers are ranked based on public reputation, domain credibility, and performance data, ensuring fair and data-driven comparisons.
• Direct contact: Reach out to providers immediately, cutting out intermediaries and gaining access to authentic, transparent pricing without hidden fees.

Removing Brokers and Hidden Costs

Traditional methods of sourcing 3PL services often involve multiple intermediaries, each adding their own fees, which inflate costs. Forthmatch eliminates these inefficiencies by connecting brands directly with logistics providers. This zero broker fee model ensures that rankings remain impartial and costs stay transparent.

By enabling instant access to multiple providers, Forthmatch creates a more efficient and competitive marketplace. Negotiations happen directly between brands and providers, making the process quicker and more cost-effective.

How DTC Brands Use Forthmatch

DTC brands are leveraging Forthmatch to optimize their supply chains and adapt to the fast-paced demands of modern e-commerce. Here’s how:

• Real-time supply chain alignment: Forthmatch centralizes critical data, including product SKUs, sales history, forecasts, supplier details, and inventory updates. This 360-degree visibility helps brands respond swiftly to sales trends and inventory changes.
• Faster fulfillment strategies: As customer expectations for speedy delivery grow, brands are rethinking their logistics. Forthmatch’s service area mapping helps identify providers with the right geographic reach to meet these demands.
• Localized distribution: Many brands are shifting to micro-warehouses and local distribution centers to enable faster deliveries and improved return policies. Forthmatch’s direct access model supports quick negotiations, making these strategies easier to implement .

Manual vs. Programmatic Negotiation: A Comparison

This section dives into the differences between manual and programmatic negotiation, building on how programmatic negotiation enhances operational efficiency.

The evolution from manual to programmatic negotiation is reshaping how DTC brands manage logistics partnerships. While manual methods have been the standard for years, the fast-paced and complex nature of modern e-commerce calls for a more advanced approach.

Manual negotiation often involves lengthy email threads and phone calls. Each potential 3PL partner requires individual discussions, rate requests, and custom proposals. This process becomes increasingly cumbersome when managing multiple providers across various regions or service capabilities.

In contrast, programmatic negotiation simplifies this process by enabling simultaneous engagement with multiple providers. The technology automates initial screenings, rate comparisons, and service matching, freeing logistics teams to focus on strategic decisions rather than administrative burdens.

"Programmatic advertising uses technology to streamline the ad buying process, making it more efficient and targeted, especially in cases where ABM (account based marketing) is [a focus]." - Eric Bush, Senior Director of Paid Search, Brafton

This analogy highlights how technology can streamline both advertising and logistics negotiations, making them more efficient and precise.

One major distinction lies in the data utilized. Manual negotiations often rely on limited historical data, such as past shipping volumes or rough forecasts. On the other hand, programmatic systems incorporate real-time inventory levels, seasonal trends, geographic distribution, and performance metrics from existing partnerships.

Here’s a quick comparison of the two approaches:

Comparison Table

As businesses scale, the efficiency of programmatic negotiation becomes even more evident. For example, a company expanding from one fulfillment center to three might spend months negotiating separate contracts manually. With programmatic tools, that same expansion can happen much faster and with better-informed decisions.

Another critical advantage is cost transparency. Traditional methods often include intermediary fees that obscure the true cost of services. Programmatic platforms eliminate these layers, connecting brands directly with logistics providers for clearer pricing.

Programmatic negotiation also mirrors trends in digital advertising, where precision targeting has become the norm. In fact, programmatic advertising now accounts for 82.21% of the market. Similarly, logistics negotiations can achieve a high level of precision, matching brands with providers based on technical requirements, geographic needs, and performance criteria.

Real-time optimization is another game-changer. While manual processes rely on periodic reviews to identify and address issues, programmatic systems continuously monitor performance. This allows them to flag potential problems before they affect customer satisfaction.

That said, the shift to programmatic negotiation isn’t without its challenges. Some logistics partnerships thrive on the nuances of personal relationships and custom arrangements that automated systems might initially overlook. The best approach often combines the strengths of both methods: using programmatic tools for initial screening and data-driven insights, while maintaining personal relationships for strategic collaborations.

Supporting this, Nielsen reports that brands that consolidated campaigns using programmatic methods saw an 11% increase in reach efficiency. Similar gains in logistics operations can lead to better performance and cost savings.

As logistics continue to evolve, programmatic negotiation offers a way to adapt quickly, reduce costs, and scale operations effectively - key factors for long-term success in the DTC space.

Conclusion: The Future of B2B Negotiation in Logistics

The logistics industry is undergoing a transformative moment. With DTC brands grappling with supply chain disruptions, rising customer expectations, and intensifying competition, programmatic negotiation is emerging as a game-changing approach to stay ahead.

Key Takeaways

Programmatic negotiation is reshaping how DTC brands manage logistics. By embracing automation and data-driven strategies, companies can gain major advantages in speed, cost efficiency, and scalability.

• Speed and efficiency: Programmatic negotiation allows brands to compare options in hours or days - far faster than traditional methods.
• Transparent pricing: Direct connections with 3PL providers eliminate hidden fees and markups, improving budget planning and profit margins.
• Scalability: Brands can evaluate multiple regions and providers simultaneously, enabling rapid growth without adding administrative burdens.

These benefits align perfectly with the digital-first nature of many DTC brands. As Sandra Murillo Sareyko, VP of Sales at Simpli.fi, explains:

"DTCs should consider programmatic because these digital-first brands are, in many ways, programmatic by design."

This foundation sets the stage for future advancements in logistics negotiation.

Looking Ahead

The next wave of innovation will focus on adapting to new market demands and technological advancements. Future systems will likely integrate predictive analytics and real-time performance optimization to refine decision-making even further.

• Rising consumer expectations: With 79% of consumers more likely to make repeat purchases after a positive delivery experience, the pressure for seamless logistics is higher than ever. This demand is shaping B2B relationships, as brands expect the same level of transparency and service they offer their customers.
• Convergence of B2B and B2C: As 63% of consumers prefer buying directly from brand websites when pricing and shipping speeds are comparable, logistics providers must handle both wholesale and direct-to-consumer orders effortlessly.
• Sustainability and compliance: Programmatic systems will increasingly factor in carbon footprints and evolving regulations, addressing growing environmental and legal concerns.
• Smaller, more frequent shipments: The shift to demand-driven shipping models will require logistics partners to adapt quickly. With air freight becoming more cost-competitive compared to ocean freight, faster, flexible fulfillment will become the norm.

For logistics teams, the time to act is now. Investing in advanced analytics, inventory management systems, and customer behavior tracking will lay the groundwork for leveraging programmatic tools as they evolve.

As this technology continues to mature, early adopters will gain a decisive edge, securing their position in a market that increasingly values automation, transparency, and efficiency in logistics partnerships.

FAQs

How does programmatic negotiation help DTC brands save costs and scale effectively?

How Programmatic Negotiation Benefits DTC Brands

Programmatic negotiation offers direct-to-consumer (DTC) brands a way to cut costs and scale efficiently by automating tasks that used to require significant manual effort - like managing contract negotiations and planning fulfillment. By using data-driven tools and algorithms, brands can simplify logistics, lower operational expenses, and secure better deals with third-party logistics (3PL) providers.

This method also helps businesses fine-tune their supply chains, uncovering opportunities to save money and boost efficiency. At the same time, it supports scaling operations to keep up with increasing demand. The outcome? A leaner, more responsive approach designed specifically for the needs of DTC brands.

What technology is needed to implement programmatic negotiation in logistics?

To implement programmatic negotiation in logistics effectively, you'll need a mix of AI and machine learning to automate tasks, advanced data analytics to uncover useful insights, and integrated communication platforms to simplify collaboration. Additionally, a secure and scalable cloud infrastructure is crucial for managing large datasets and ensuring seamless operations.

When combined, these tools can automate contract negotiations, cut costs, and boost efficiency - key elements for staying competitive in today's logistics and supply chain landscape.

What steps can DTC brands take to transition smoothly to programmatic negotiation systems?

To make a smooth shift to programmatic negotiation systems, DTC brands should prioritize three main areas:

• Team Training: Equip your team with the knowledge and skills to effectively use automation tools and adapt to updated workflows. This ensures everyone is on the same page and ready for the transition.
• Gradual Integration: Roll out programmatic tools step by step. This phased approach gives you time to fine-tune processes and tackle any challenges without throwing operations off balance.
• Data Management: Create clear guidelines for organizing and analyzing data. This helps ensure that manual processes work hand-in-hand with automated systems.

Focusing on these areas can help brands reduce disruptions, streamline contract negotiations, and make the most of programmatic tools in their logistics and supply chain operations.

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