How Kärcher saved $1M on freight with a competitive tender approach

CEO, Freight People

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The best tenders are about building a process that delivers measurable value, not just selecting the supplier who offers the lowest immediate price. For global cleaning solutions giant Kärcher, this meant taking a closer look at their freight operations through a meticulous and competitive tender process.

In this blog, we take a closer look at how Kärcher’s strong data foundation shaped their tender process and delivered real results, including $1 million in freight savings within the first year alone. We’ll unpack the key strategies Kärcher used and highlight actionable learnings you can apply in your own tender process to achieve similar success.

The best tenders come with the best data

With Freight People as their incumbent partner, Kärcher had a unique advantage. Years of partnership meant Freight People had deep insights into their freight history, including critical data like shipment volumes, delivery requirements, and receiver specifications. This rich data foundation allowed Kärcher to run a precise and fair tender process, giving all potential suppliers access to the same clear and detailed information.

The data was structured and actionable as Freight People’s solution is built upon Cario, a leading Freight Management Solution. Information was centralised into a supplier-friendly format, providing detailed consignment-level freight profile data that also included where there were specific handling requirements - from hazardous goods handling and tailgate deliveries to time-slot bookings and movement of sensitive commercial equipment. This level of granularity eliminated ambiguity, and ensured suppliers could respond with accurate and competitive pricing.

Suppliers could also use this data to model scenarios that might impact freight costs - such as adjusting for seasonal demand spikes or preparing for increased orders from major partners like Bunnings.

Perhaps most importantly, this data-driven approach shifted the tender’s focus from simple cost-cutting to delivering strategic value. By identifying opportunities to optimise processes and prepare for future needs right from the outset, Kärcher positioned themselves for long-term efficiency gains.

Transparency creates fair competition

A truly competitive tender thrives on transparency. Kärcher’s data-first approach put suppliers on a level playing field, each armed with the same detailed data and clear expectations.

Kärcher invited both single carriers and brokers to participate in the tender, and so it was important to consider zoning variability between different suppliers. Data supplied was reflective of actual destinations, rather than freight zones, which meant tender participants were left to structure their proposal according to their own rate structure. This is good practice to ensure you get maximum responses to your tender.

This clarity also simplified Kärcher’s evaluation process. Because every proposal was aligned to the same framework, comparing bids was less about decoding inconsistencies and more about overall freight spend, service levels and the best overall value. In the end, this transparent process ensured that suppliers, whether incumbent or new, had an equal opportunity to compete.

Integration as a foundation for efficient freight operations

A key requirement in Kärcher’s tender process involved seamless integration with their existing ERP and 3PL systems. This would provide them with real-time shipment tracking to give their teams instant visibility into freight movements and delivery statuses at any moment, including real-time PoDs. Automating key processes, like inventory updates, was another priority, ensuring stock levels would adjust instantly upon dispatch or receipt of goods. By embedding freight costs and tracking details directly into their ERP, Kärcher aimed to elevate financial accuracy, simplify reconciliation, and transform budget forecasting.

Competitors without these integration capabilities faced significant barriers as Kärcher would have been forced to rebuild system connections from scratch, leading to delays and unnecessary costs.

Balancing cost with operational value

While cost savings were a key outcome of Kärcher’s tender process, they made it clear that upfront savings weren’t the only priority. Long-term operational value was equally important. Kärcher focused on evaluating suppliers based on their ability to meet high service standards, offer advanced technology solutions, and adapt to future growth or seasonal demand.

This balanced approach avoided the common pitfall of prioritising price over performance, and ensured their chosen supplier could consistently deliver on expectations and scale efficiently.

In fact, the $1 million saving Kärcher achieved in the first year reflected this type of holistic approach that prioritised strategic value and operational excellence.

Feedback and collaboration improve tender outcomes

A tender should be a collaborative effort that bakes in open communication and constructive feedback. By engaging with short-listed suppliers after the first evaluation stage, Kärcher was able to provide clear guidance on areas where proposals excelled or needed improvement.

This iterative approach allowed suppliers to refine their bids, fitting them more closely to Kärcher’s priorities. Providing feedback also ensured fairness, as all suppliers had an equal opportunity to meet Kärcher’s expectations. This open exchange ultimately led to stronger proposals, a more competitive process and better outcomes for both parties.

Planning for future growth and scalability

Kärcher’s tender process accounted for both present and future needs. Seasonal fluctuations, surging demand from major partners like Bunnings, and the need for long-term cost predictability were all factored into their approach. In particular, offering flexibility, such as agreed and capped future rate changes, helped cement their choice of supplier.

Structuring a timeline for tender success

Kärcher allocated enough time for suppliers to carefully review the data, prepare detailed responses and refine their proposals. Direct carriers were given two to three weeks to submit their bids, while brokers, who required more time to coordinate with multiple suppliers, were allowed four to five weeks. This thoughtful timeline ensured all participants had the opportunity to submit competitive bids tailored to Kärcher’s requirements.

The evaluation process was equally deliberate. By aligning timelines with internal reviews and feedback loops, Kärcher could provide constructive insights to suppliers while keeping the process moving. This structured approach balanced speed with the thoroughness needed to make informed decisions, ultimately leading to better outcomes for all parties involved.


A detail-driven decision for long-term success

Guided by global directives, Kärcher set out to ensure their Australian freight operations were not only cost-effective but also met their high operational standards. Their commitment to detail - from providing granular data to outlining precise requirements - ensured that suppliers could submit tailored and competitive proposals while giving Kärcher the confidence to select a supplier who aligned with all requirements.

This deliberate tender strategy led to a decision rooted in both immediate value and future readiness, and ultimately secured Freight People as their continued chosen partner to drive their freight operations forwards.

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Dave Evans

CEO, Freight People

Dave Evans is the CEO of Freight People, bringing strategic leadership and a passion for innovation to one of Australia’s leading enterprise freight…