Have you looked at a single-source parcel shipping solution?
With supply chains becoming ever tighter and order sizes becoming smaller, more and more companies are turning to parcel shipping in an effort to meet their customers expectations at a price point they can afford. But this mode of transportation has often been under the radar of the logistics manager, and has not received the same level of scrutiny that the more traditional modes have such as LTL, TL, and rail. Consequently, according to a recent survey by Aberdeen Group, companies anticipate they could reduce their parcel freight spend by 7.3% if they implemented tighter spend control.(1)
Investing in a single-source parcel shipping solution moves your small package shipments onto the radar screen and allows you to control freight spend by:
· Comparing levels of service: Not all carriers are equal in the routes and services they provide
· Gaining efficiencies and effectiveness: Eliminate disparate systems and processes that are required for different
carrier manifest stations
· Being proactive: Provide the shareholders in the supply chain (customers, brokers, forwarders, customer service)
with shipment information before they call you
· Saving money: Always pick the carrier with the lowest rate while still meeting your customers
One high-tech firm realized they were shipping with one carrier and providing one level of service (overnight!) to all their customers regardless of when the customer expected the goods to arrive.
Comparing levels of service
Like any other provider of transportation services, each of the parcel carriers has some routes that are more advantageous to them than others. Because of the location of their facilities, they can offer better rates in specific lanes. Conversely, there are other routes where they are not so favored, and must charge more to provide the same level of service. But to truly compare one carrier to another, you have to make sure that you are keeping delivery times and shipment weights consistent and this type of analysis can be time consuming and quite complex, especially as the number of shipments per day increases.
Inefficiencies means ineffectiveness
Utilizing more than one carrier brings additional hardware and software integration points, as well as multiple procedures for the same process (shipping). Not only can a shipping area become over-crowded with manifest machines, redundant scales and printers, it also means that more systems have to be integrated and maintained in order to avoid the cost and error generation that comes with duplicate data entry.
The Catch 22 of being reactive
How many times a day does your shipping department take calls wondering when did the shipment leave, how did it ship, what is its ETA? And how much time do they spend copying or scanning documents to send to the participants in the supply chain? Being reactive can take up valuable resources over and over again.
Save money!
When ship via decisions are made arbitrarily or without consideration for possible consolidation opportunities, a company cannot rest assured that it has maximized its freight savings to the fullest potential. In addition, without having all freight spend history in one place, companies often rely on the carrier to report back on their annual usage which is then used to negotiate the following years rates.
One major industrial company thought they were receiving the best service and rates from a major parcel carrier, until an analysis of their freight costs uncovered charges for next day, 2nd and 3rd day air (which they thought they were not using) as well as savings to be had in various routes by use of alternate carriers, and for weight, dimension and address corrections
How can Precision Software help you?
Precision Softwares TRAXi3 multi-carrier parcel manifesting solution i3ship allows you to ship from anywhere to anywhere, including international locations, and always picks the optimal rate for the level of service required. Like the software that is supplied by the carrier, i3ship allows you to print carrier certified labels, assign tracking numbers, and prepare end-of-day reports. It also allows you to comply with your customers requests to use their preferred carriers, but without having to worry about redundant equipment.
The table below summarizes the advantages that can be gained from using a multi-carrier solution versus a carrier provided solution:
Factor | Carrier-Provided System | |
Shipping Costs | Pick the lowest price carrier for the level of service required, including LTL consolidation for first leg. | One rate per route which may or may not be the best. Restricted to parcel carriers for all legs. |
Labor Costs | All required data is fed directly from the Order Management system | Order information may have to be re-keyed into shippers system |
Availability | Shipping requests can be made from any (authorized) terminal in the company | Shipping requests must be re-keyed into the terminal supplied by the carrier which is located in shipping department |
Customer Service | Shipments can be tracked online by customer PO, Sales Order, or shipper-supplied tracking number. Tracking number links can be embedded in advanced shipping notices with automated distribution | Shippers tracking number must be manually linked |
(1) Parcel Shipping: How to Cut Costs by Moving to Enterprise-wide Control Aberdeen Group, July 2007
Precision Software
651 W. Washington Blvd.
Suite 303
Chicago, IL 60661
Tel. 312.334.8600
