Controlling Transportation Spending

Sample Project

TO REDUCE COSTS, YOU NEED CONTROL

The Client
Our client is a mid-sized North American retailer with stores located across a large region.  Transportation spend is large due to the size of the distribution network.

The Need
Management was concerned that transportation costs were higher than necessary. It felt that the complexity of its network led to payment inaccuracies and uncertainty in budgeting. The client decided to examine these areas to strengthen management of the transportation function.

The Approach

SCS looks at transportation management holistically. For this client, we:

  • Conducted a post-audit of freight payments for a test period.
  • Defined the total freight cost/shipping volume relationship.
  • Examined freight management data and processes.
  • Developed solutions for the issues identified.
  • Worked with the client on a path for improvement

The Output

SCS provided elements of a complete transportation management, solution including:

  • An action plan to address payment inaccuracies.
  • A tool to simplify freight budgeting based on shipping volumes.
  • A summary of freight rates for key lanes.
  • A process to strengthen transportation data and planning in the future.

The Impacts

Based on our work, the client was able to:

  • Recover overpayments to freight carriers.
  • Budget for transportation costs more accurately and rapidly.
  • Plan routes and select carriers more effectively.
  • Initiate changes in its overall approach to transportation management.

The client is expected to save several million dollars per year when the solutions are fully implemented.