World Trade - August 2008 - (Page 32)

LOGISTICS download pricing directly into their applications for faster comparisons, and increase accuracy by eliminating the need to re-enter data. Morphing to longer-term contracts The concept of a business being too small to consider a contract with one or more carriers is dissipating as carriers evolve to handle all types of services volume, Stiles says. Conaway, for example, advises shippers to enter into a longer-term contract when they have enough volume to beneﬁt from customized pricing or for products with unique characteristics. Routine shipments, he says, don’t really need longer-term contracts. That, however, varies according to carrier. When shipments grow to the point that shippers begin to contemplate formalizing relationships with carriers through longer term contracts, they may ﬁnd it beneﬁcial—especially at ﬁrst—to work through a third-party logistics provider (3PL). The great beneﬁt is that 3PLs do the pre-qualifying work of monitoring performance and services and tracking services have similar information. rates that otherwise would fall to the shipper, and tend to Checking credit worthiness is another subtlety that tracks get very good rates based on their aggregate volume. back to service and reliability. If the That’s the solution KC Flip company can’t pay its drivers, the Books employs. The benefits go Although costs are turnover rate is very high. Therebeyond cost, according to owner fore, the caliber of driver tends to Linda Munch. Her broker “… certainly important, be lower, which affects reliability as gets me really good rates, but more well as the quality of service. And, also consider reliability, importantly, they monitor the shipfor outbound freight, the driver ments. It saves me a great deal of becomes the face of your com- transit times, geographic time and aggravation,” she says. pany during that last mile. The In the experience of Big Lots!, coverage, delivery carrier’s assets also are a factor in working with 3PL Unyson this assessment, as a company with Logistics resulted in inbound of accessorials, driver physical assets has made a tangible savings of more than 30 percent. commitment to its continued exisThose savings came not only know-how and cost of tence while a virtual company has from the LTL bidding process, less financial exposure that may but through transportation manclaims from damages. sometimes also indicate less comagement techniques. Unyson mitment. optimized LTL shipments using While you’re researching carriers’ ﬁnancial positions, intermodal transportation as well as straight trucking, also look at their claims ratios and, importantly, their repu- and worked through consolidation centers to further tations for prompt payment of claims. Experienced ship- optimize logistics, according to Unyson’s case study. pers advise researching carriers’ claims adjustment process Although 3PLs offer a streamlined approach to managupfront, before it is needed. Such details as whether there is ing transportation logistics, negotiating directly with a cara designated person or department to adjust claims and the rier has certain advantages, too. One shipper, speaking off details of how they actually are handled can make a differ- the record, advises logistics managers to search the Internet ence in terms of speed of service and overall satisfaction. for a standard contract. “Have the legal department review it.” Then, he says, send that contract to the relevant carriers Real-time capabilities and shop the price. Online capabilities seem ubiquitous, but the depth and Rates and services are more negotiable than most people breadth of electronic services vary considerably, particularly realize, particularly as volume increases. “Carriers are often in terms of how the information is made available through- very creative,” Stiles says. For high value shipments, for out the carrier’s own operations. For example, the ability to example, Stiles says he’s seen carriers take over the managegenerate real-time electronic bills of lading, track and trace ment of LTL shipments from the customer. Other services shipments and see proof of delivery may be available, but also may be available. The key is to know what you, as a other operations, like accessing freight bill payments and shipper, want. WT generating reports in real-time may not be available. Determine which online capabilities are important to your oper- Contributing Editor Gail Dutton writes frequently about logistics subjects. ations—and to your customers—before choosing a carrier. For reprints of this article, please contact Cindy Williams Some of these features, like online procurement, can save at williamsc@bnpmedia.com or 610-436-4220 ext. 8516. considerable management time by allowing companies to 32 WORLD TRADE AUGUST 2008

Table of Contents Feed for the Digital Edition of World Trade - August 2008

World Trade - August 2008 Contents Weathering the Storm Helping the World’s Poorest Nations Benefit from Global Trade Supply Chain Watch Tradewinds World Trade’s Top U.S. Trading Partners LTL Shipping ‘On the Fly’ Air Cargo Flies a New Heading Getting More from China Sourcing Why 3PLs Need a Seat at the C-TPAT Table Performance-based Supply Chains Drive Total Lifecycle Value SmartWay Navigates Sustainable Transportation Around the World in 80 Days—Hours—Minutes

World Trade - August 2008

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