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Kuebix SupplierMAX

The Recipe for an Unbeatable Inbound Freight Management Strategy

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Managing inbound freight operations is an ongoing challenge for businesses with large numbers of suppliers. Companies are impacted by the inefficiencies, low levels of visibility and lack of standardization associated with the management of their inbound freight. These problems are exacerbated when companies lack comprehensive strategies for obtaining the lowest possible shipping and unloading costs or a plan to improve the behavior of their suppliers. A complete strategy for inbound freight management needs to encompass the following three aspects; visibility, collaboration and accountability.

Visibility – Although companies control their own destinies on the outbound side of the equation, that level of control dwindles when it comes to inbound freight. In the end, the receiving company does not have full planning and visibility for shipment arrivals and dock reservations. To optimize their inbound, stakeholders can benefit from better visibility of information (e.g., knowing what carrier is being used, exact timing of deliveries, how much manpower is in the DC to load/unload shipments, etc.), real-time data sharing and the knowledge that everyone is working toward a common goal.

Collaboration – By using a comprehensive inbound freight plan based on a collaborative ecosystem of shippers, suppliers and carriers, companies can effectively establish a dynamic rating and unloading allowance program. As companies work in partnership with their suppliers to determine the most cost-effective method to handle each shipment – customer pick-up (CPU) or vendor controlled (VDS), the goal should be to reduce overall shipping costs. By giving suppliers choices, they’ll be able to pick the most effective service and billing procedure. Convert inbound shipments from VDS to CPU shipments only when it’s feasible, and then establish preferred rates with a select group of carriers to handle those inbound shipments at the lowest possible cost and best service type. Use a standard routing guide to establish a set of mandatory carriers that will be used for all VDS and CPU shipments. This will enable LTL pricing improvements, superior service levels and maximize opportunities for LTL consolidation.

Accountability – While companies can’t always control what their suppliers do or the efficiency of suppliers’ systems, they can implement Vendor Inbound Compliance Standards (VICS) to help improve supplier behavior. A comprehensive set of compliance procedures will establish rules and processes that must be followed by suppliers when making deliveries. These accountability levels should also extend to the company’s own supply chain/logistics department and procurement group, both of which play a role in ensuring that products get quickly from their origin to the distribution center (DC). The goal? Improve supplier behavior so that their inefficiencies are not wasting time and money at the DC. It’s also important that a company’s inbound strategy includes leveraging detailed analytics to measure the results of the program and take action where necessary to improve service with suppliers and carriers.

By following this general recipe, companies can work with specialists in inbound freight to develop an unbeatable inbound freight management strategy. But knowing what to do and being able to do it effectively are two entirely different hurdles companies need to jump. It’s for that reason Kuebix has developed SupplierMAX, a program where companies can leverage Kuebix’s technology and logistics experts to manage all or a portion of their inbound freight program. SupplierMAX improves supplier behavior and increases the efficiency of warehouses and distribution centers by incorporating a series of comprehensive strategies to improve inbound operations. To learn more about this program, click HERE to read the SupplierMAX press release in full.

Gaining Supply Chain Visibility Doesn’t Have to be a Daunting Task

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Supply chain visibility (SCV) is at the forefront of supply chain leaders’ minds in 2018. Today’s businesses need to know where their product is, when it is going to be delivered, and every detail regarding the contents of their freight. It’s also essential to provide this level of visibility to all the stakeholders in the supply chain. Silos between procurement, warehouse ops, finance and the customer cause breakdowns in the system, resulting in wasted time and lost revenue. Imagine connecting all the logistics professionals who are working to ship your freight from point A to point B on one seamless interface. Giving stakeholders access to the same actionable information in real-time sets them up for better communication and the ability to remove roadblocks.

For many companies working diligently to compete in the new landscape, the prospect of enhancing visibility to their supply chains is daunting. The expected time commitment and resources required to integrate legacy systems with a transportation management system (TMS) is often seen as too costly and inefficient; outweighing the benefits of such a system. These barriers to service are hindering many companies’ ability to gather data on their supply chains and compete at the high-level Amazon has made the industry standard.

Kuebix is revolutionizing logistics management with its intelligent TMS. By seamlessly connecting legacy ERP systems with Kuebix and bolstering the direct customer-carrier relationship, Kuebix enables shippers to see every node of their supply chains. Stakeholders can use one solution to view and manage their freight, saving time and breaking down silos. And depending on the scope of the integration needed, Kuebix TMS can be ready to use in a few weeks to a few months. This modular, scalable solution gives companies previously unable to cope with the commitment of old-fashioned TMS systems the ability to make data collected across the supply chain available to all users and gives them greater control and visibility into what is happening across their enterprises.

Supply chain visibility will be a weighty topic in 2018, as the industry acclimatizes itself to new levels of supply chain control. The question is no longer whether visibility is essential for shipping companies, but how long customers are willing to patronize suppliers without it. The competition will become fiercer and the bar continue to be pushed higher. Here are Kuebix we are excited to see how the demand for increased visibility will continue to evolve the supply chain.

How Food & Beverage Companies Can Optimize Their Inbound

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Food and beverage businesses have complex supply chains with many unique characteristics: ever-changing customer tastes, tight margins on store shelves, fresh products that may spoil, expiration dates on products, and more. Getting the right volume of products at the right time, and at the right location, is no easy task. Visibility into and control of supply chain processes will allow food and beverage businesses to address these challenges while meeting business goals.

Frequently overlooked and often pushed to the bottom of a shipper’s supply chain agenda, good inbound freight management can help companies improve shipment visibility, save money, and enhance customer service—all of which add to the bottom line and boost profitability. Done right, inbound freight management does more than just help companies gain an understanding of where their shipments are in real time. It also enables better relationships with carriers and suppliers for consolidation efforts, establishes routing guides that lead to much better dock efficiency, and empowers strategies for continuous improvement initiatives.

Food and beverage companies get dozens of deliveries a day from different suppliers. These inbound shipments aren’t coordinated or consolidated, fostering inefficiencies from the excess number of deliveries. Little visibility into arrival times and frequent changes to inbound deliveries wreaks havoc at the dock and warehouse, which can make accessorial charges skyrocket and your inbound transport costs go off the charts.

Small to large food and beverage companies have found a TMS to be the perfect tool for addressing the many challenges that come with managing inbound freight. For example, one food retailer that operates over 200 stores across seven states had a couple hundred LTL deliveries per week, but by using Kuebix TMS, they were able to lower the number of deliveries to 20 or 30 per week by combining LTL deliveries into full truckload deliveries from the consolidation points. The typical cost for unloading a truck is $200, leading to approximately $34,000 in savings per week just on unloading costs!

Here are three steps you can take to start managing your inbound freight more effectively today:

1. Partner with your suppliers to lay out a plan of action. Determine the most cost-effective and efficient way to ship and unload your freight, and build a plan with your suppliers that benefits both parties. There is no “magic number” for a percentage of shipments that should be vendor-controlled vs. customer controlled. Give your suppliers a choice so that they can select the most effective service and billing procedure. Then, implement a standard routing guide for supplier compliance. This will establish a set of mandatory guidelines that will be used for all vendor-controlled (VDS) and customer pick-up (CPU) shipments. Supplier compliance programs reduce your cost of goods by making your carriers and warehouse more efficient. In the event your suppliers fail to comply, they will share in your cost through violations outlined in the routing guide.

2. Create strong alliances with your carriers. Consolidate inbound shipments to full truckload wherever possible to reduce freight and unloading costs. Reducing the number of individual LTL shipments will decrease the cost of freight, dramatically increasing the efficiency of your distribution center and significantly reducing unloading costs. Think how much more efficient your operations will be with fewer trucks and fewer deliveries. For example, unloading 10 to 14 different LTL shipments can be five times the cost of unloading a single truckload. The customer and the supplier can share all of these savings through the efficiency of consolidated shipments and drop trailer programs. By consolidating your LTL pool, you can simplify yard management and maximize consolidation opportunities. Select carriers that provide attractive rates and superior service and try to limit that set to two to four different carriers, whether the shipments are CPU or VDS. This will give each carrier enough business to ensure LTL consolidation does not affect service levels. Having a strong partnership with your carriers also opens up other opportunities for additional savings such as backhaul agreements with LTL carriers to consolidate freight to single truckload for pick up by your own fleet for the final mile.

3. Leverage technology to your advantage. Utilize a transportation management system (TMS) to maximize inbound freight management. For example, leverage your TMS to implement an allowance program for freight costs and unloading expenses with your suppliers. In most cases, allowances are negotiated once or twice a year, and rarely take into account fluctuating costs and carrier rates. Oftentimes, market rates rise above negotiated rates. Kuebix TMS enables the creation of dynamic rate allowances to ensure savings on both TL and LTL shipments by calculating the best possible real-time vendor allowances based on actual carrier rates as demand dictates. Additionally, a TMS will also automate tracking, scheduling and door assigned, which will directly reduce your labor spend. Finally, if you cannot measure something it is hard to improve it. An effective TMS will capture every relevant piece of data and return reports, dashboards and scorecards that allow you to analyze your inbound freight program and identify opportunities for increased efficiency.

Ultimately, good inbound freight management facilitated by technology helps shippers achieve cost and productivity goals that very often get overlooked in the logistics space. By taking a step back and gaining a better understanding of your current inbound environment—then working with suppliers and carriers to come up with a plan of action to improve it—you’ll be able to leverage all of the market’s capacity, get the best rates, and gain better visibility over your end-to-end supply chain.
To learn more about optimizing your inbound read “The Art of the Inbound”.

The ELD Mandate Adds to Truck Driver Shortage Woes

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Did you know that many truck drivers have said that they would rather quit the industry than use an ELD device? In April of this year, Overdrive did a survey of its readers that showed 70% of truck drivers were opposed to the ELD mandate. The magazine goes on to speculate what the marketplace would look like without these truckers, “Assume the 71 percent of independents who say they’d quit actually do, and apply that to carriers in the for-hire population with one to five trucks. This would equate to an overall loss of about 260,000 trucks, according to data mined by RigDig Business Intelligence, Randall-Reilly Business Media’s equipment- and business-data analysis unit. That would remove more than 10 percent of the industry’s capacity. When the 71 percent is applied to carriers with up to 15 trucks, it leads to a capacity reduction of more than 27 percent, or about 709,000 trucks.”

The American Trucking Association (ATA) expects the driver shortage to grow to 239,000 by 2022, primarily due to retirement and increased driver demand. Combine this with the notion that many drivers will quit when the ELD mandate becomes live next month and the ATA has seen double digit gains in the annualized turnover rate for both small and large truckload fleets, jumping 16 percentage points to 90%, the highest it has been since Q4 2015. For smaller carriers with less than $30M annual revenues, the turnover rate grew by 19 percentage points to 85%, the highest since Q1 2016. This news cements the acceleration of the driver shortage, making it an ever-critical challenge to be solved.

At Kuebix, we believe that the best approach to solving the driver shortage is for shippers to implement a four-part plan that focuses on young age groups to ensure a steady flow of skilled and energized individuals that see the profession in a new light. The plan to mitigate the driver shortage includes:

· Embracing Robust Technology – As younger age groups spend lots of time online and with their smartphones, using mobile device apps to track vehicle location and to update the driving experience should be a key focus for shippers. Virtual reality is being used by many transportation companies to train drivers. This age group also seeks tech-savvy employers that continue to apply technology to address transportation management challenges in the form of social media and disruptive technology, along with pursuing startups that use advanced tech to drive their business forward.

· Recruiting the Recruited – Tackling the driver shortage by opening the profession up to those with actual truck driving experience who find it difficult to move from a trucker in the armed forces and/or driving chops in war zones is another way to increase the number of drivers. The most attractive aspects of recruiting the recruited is the fact that drivers from the services are already experienced, which should lighten the load substantially from a training and education standpoint.

· Tapping into the STEM pipeline – As the Science, Technology, Engineering and Math (STEM) curricula gains greater adoption from grade school on up, graduates learn problem-solving skills that can be used in transportation, along with other industries. By sponsoring STEM events, corporations can open the doors to their future workforce by showing students career paths to follow in the transportation industry.

· Recasting the Profession – Sitting back and waiting for the driver shortage to solve itself is not an aggressive enough solution that will end the issue quickly. The industry needs to get more determined, go on the offense and purse the above-mentioned opportunities. Think like the youth of today and reach them where they live, offer the tech they use, catch them at an early age and make sure they’re well aware that driving is much more than just steering a vehicle. Be at high school (and trade school) career fairs, be on campus just like college recruiters are and where members of the armed forces are concerned – be there for them when they need your support the most.

Plus, shippers need to be more creative and think of new ways to gain efficiencies and reduce costs. Technology like the Kuebix TMS can help by giving shippers high levels of visibility across their entire transportation networks—and connectivity among all partners. Cloud-based Transportation Management Systems (TMS) are helping companies connect in one place to less-than-truckload, truckload, and parcel carriers; receive real-time LTL quotes using direct carrier rates; and request and receive spot quotes using a single shipment management interface. Technology can help put a dent in the driver shortage challenge, while improving transportation operations – that’s a win-win for all parties involved.

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How to use Data to Build a Stronger Carrier Relationship

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Strong partnerships between carriers and shippers are important for the most efficient and effective freight operation. When shippers and carriers work together as a team, respecting one another’s time and business objectives – a win-win partnership is created that leads to continuous improvement in logistics efficiency and customer service.

How can shippers and carriers improve their relationship? Shippers should provide accurate weight and size measurements of their freight, file claims quickly, not keep drivers waiting at their warehouse and fulfill promises of consistent loads. Carriers must negotiate fairly with shippers, adhere to routing guide compliance, pickup shipments on time, invoice shippers accurately and provide a consistent level of exceptional service.

How can this be done?

The answer is technology that can help manage the carrier and shipper relationship by capturing all transactional information and using this data to foster accountability. The Kuebix Transportation Management Systems (TMS) capture data across every shipping event to provide visibility into true levels of service and efficiency. The accurate and timely data from the TMS can be used to monitor and validate communications and interactions between shippers and carriers, but Kuebix takes this one step farther.

Kuebix Carrier Relationship Manager uses this information to deliver Freight Intelligence to easily analyze the performance of carriers in the form of carrier scorecards. Typical analysis can be performed on:

  • • Carrier rate benchmarking by lane
  • • Carrier responsiveness
  • • Load acceptance rate
  • • Claims percentage by shipment – how many damages occur and by which carrier
  • • Rate exception percent
  • • On-time performance
  • • Invoice and freight bill accuracy and solving inaccuracies
  • • Driver performance
  • • Reliability of equipment and processes
  • • Documentation – accuracy, availability, etc.

Leverage this feature to work with your carriers with a set of metrics and facts rather than anecdotes. Carriers will appreciate the fact-based approach to performance monitoring, resulting in stronger relationships and improved service levels.

Keep the logistics team more organized with all contact information, schedules and tasks kept in one location. The new functionality will relieve admin of countless hours of chasing paperwork and tracking communications, while keeping carriers accountable. Carriers will benefit from clearly defined goals, while shippers will benefit from improved performance and service levels.

Kuebix Carrier Relationship Manager is a new, standard feature of Kuebix Business Pro TMS, a full-service transportation management system that features unlimited shipment management, advanced analytics, carrier scorecards, financial management with freight rate invoice and claims control, and much more. Kuebix Business Pro is available for a free 14-day trial.

A Clear Industry View

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Dan Clark_3274_reduced

Dan Clark, Founder & President, Kuebix

The logistics industry revolution has begun. Technology is empowering supply chain visibility, control and collaboration that was unimaginable just a few years ago. My experience dates back more than two decades when, while working as a supervisor at a major LTL carrier, I spent my days walking the dock and learning everything I could about freight. I quickly worked my way up in the industry and at the age of 28 I was regional director of one of the largest freight divisions in the northeast, and from there became a divisional vice president overseeing 23 terminals.

While at USF group, I helped standardize business process across five different LTL companies and worked with the IT team to develop software applications to automate these processes. Back in 2007, I saw the emergence of cloud technology, knew the impact it would have on logistics, and founded one of the first true cloud-based transportation management systems, Kuebix.

Today, companies are looking more than ever at opportunities in the supply chain to increase efficiencies and bottom line dollars. Over the course of my career, I have met with thousands of companies and almost all of them have shared a common problem – pain points in their shipping process. Many companies outsourced shipping to third party logistics companies (3PLs), which have come to play a huge role in the industry. However, emerging players fueled by technology are challenging their dominance. This kind of disintermediation is not a new phenomenon; we’ve seen the impact on the travel and movie rental industries to name a few. Remember going to Blockbuster on a Saturday night?

Don’t worry, trucking isn’t going anywhere. Until someone invents a device that transports packages through space and time, almost everything will continue to be moved by trucks. However, what is changing is the inefficiency of an old school industry.

I believe that complete supply chain visibility is paramount for business success in this evolving marketplace. In Supply Chain 20/20, I offer my industry knowledge, opinions, insights and predictions as we witness the evolution of logistics. I hope that you will join the conversation by sharing and commenting on my posts. The time is now for the logistics industry to change. Get ready to embrace the change or be left behind!

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