Did you know? You can find trends and changes in spot market rates using Outbound Tender Rejection Rates.
What is it?
Outbound Tender Rejection Index (OTRI) rates are measurements of carriers’ willingness to accept the loads that are tendered to them by shippers under contract terms. It is expressed as a percentage of loads rejected to total loads tendered. OTRI can be viewed at a national, regional, state or market level, and can be broken down by both trailer type and length of haul.
Example: A market has 100 tendered loads accepted, and 4 loads rejected.
OTRI = 4 / 100 = .04 or 4.00%
Who needs it?
Carriers: OTRI gives carriers a view on on spot market activity. When spot market rates increase, you will see an increase in OTRI (blue markets) as carriers decline contracted loads in search of higher paying freight, when the spot market declines, you will see a decline in OTRI (white markets) as carriers settle back and accept their contracted lanes.
Brokers: Volatility in a market can lead to higher margins for brokers. Brokers are able to pinpoint volatile markets based on high tender rejection rates, and target spot market loads. OTRI can also help brokers make decisions to accept or reject loads on their contracted freight freight based on high or low tender rejection rates.
Shippers: Fluctuations in spot rates can alter shippers’ ability to find capacity to cover their loads. Current trends in OTRI can help shippers make decisions such as extending or retracting tender lead times to ensure capacity for their loads.
What can I do with it?
Better understand the carrier’s reaction to current market conditions using outbound rejections. The higher the OTRI percentage the less carrier availability to move the freight at the contracted rate in the market. Carriers reject loads for one of two reasons:1) lack of available capacity; or 2) too low of a rate. Fast movements up or down in a market indicate potential spot market activity as well as freight volume surges and network imbalances.
OTRI data helps users be proactive by predicting which direction spot market rates are moving through upward and downward trends in a market.
Show me how!
1) Click U.S. Map to view the outbound tender rejection rate index at a high level to see which markets have elevated tender rejection rates.
- Markets that are shaded a darker blue indicate a higher percentage of contracted loads being rejected in a market.
- Markets that are shaded a light blue or white indicate a lower percentage of contracted loads being rejected in a market.
2) Click Chart to view the historical trends and changes in the outbound tender rejection rate index.
- Markets with positive trends indicate that spot market rates are on the rise.
- Markets with negative trends indicate that spot market rates are declining.
- Breakdown OTRI into VOTRI for dry van equipment, and ROTRI for reefer equipment to understand the trends and changes by equipment type.
Pro Tip: Use OTRI in conjunction with the Headhaul Index (HAUL) to see both capacity in a market and the direction spot rates are trending.
If you have questions about outbound tender volumes, please contact us at firstname.lastname@example.org.