Thursday, January 31, 2013

Data Driven

What you don’t know will hurt you when it comes to transportation costs.

Shippers seeking reduced less-than-truckload shipping costs need to start not with lower rates but “cleaner” data. Incomplete, inaccurate data on shipments and distribution operations is a constant roadblock to transportation savings, speakers at a panel on LTL procurement said during the SMC³ Jump Start 2013 conference in Atlanta last week.

“There's a disconnect between what shippers think an LTL carrier needs to put together a good response to an RFP and what we do need,” said Paul Dugent of Estes Express, reported the Journal of Commerce. “When we get good information, we can put together an aggressive pricing program.”

Shippers should be able to provide historic data at the shipment level, starting with weight, class and density, attendees were told. The problem is that many shippers don't have good processes to capture that detail.

“Not understanding actual classification characteristics or your business requirements can have disastrous results,” said Joshua Dolan, director of transportation for Dick's Sporting Goods, a $5.7 billion retail shipper. This is the age of data, and shippers, 3PLs and LTL carriers today are swamped with information streaming from an array of sources that increases exponentially each year. But that data often is stored in disparate, disconnected systems where it is not easily accessible or interpretable.

Making sense of that data requires not just improved technology and more collections points at the retail store, warehouse or cross dock, but better underlying processes and management. Understanding data is the key to improved efficiency and lower shipping costs — as distinct from lower rates.

Collecting, keeping and sharing accurate shipping information with logistics suppliers and carriers is key to lowering overall costs, Dolan said. “We're sharing information with these guys to make sure they understand our business thoroughly.”

Stop us if you’ve heard us say this before, but if you can’t measure it, you can’t improve it. Let us show you how the TOTALogistix suite of analytics tools can let you understand your supply chain in ways never before possible – and be sure your shipping is driven by data, not just by Teamsters.

Kirk Shearer


No comments: