Buying Transportation and 3rd Party Logistics Services-Part II

Buying Transportation and 3Buying Transportation and 3rdrd Party Logistics Services II: Party Logistics Services II:

How Do You Bring Purchasing Skills to the Process of Purchasing How Do You Bring Purchasing Skills to the Process of Purchasing Transportation and Logistics ServicesTransportation and Logistics Services

ForFor

The 61The 61stst Annual Southwest Annual Southwest Supply Management Supply Management

ConferenceConference

Thomas L. Tanel, C.P.M., CTL, CCA, CISCM, President and CEO andThomas L. Tanel, C.P.M., CTL, CCA, CISCM, President and CEO andRonald D. Grossman, PMC, PCMH, CISCM, CEPP, Practice LeaderRonald D. Grossman, PMC, PCMH, CISCM, CEPP, Practice Leader

CATTAN Services Group, Inc., College Station, TXCATTAN Services Group, Inc., College Station, [email protected] 979-260-7200

© 2007 CATTAN Services Group, Inc.

mailto:[email protected]

CATTAN Services Group, Inc.CATTAN Services Group, Inc. 22

Today’s AgendaToday’s Agenda

Part IIPart II Purchasing T & L Profile and SpendPurchasing T & L Profile and Spend Freight Modal Analysis and Decision Freight Modal Analysis and Decision

ImpactsImpacts The Four ‘S’sThe Four ‘S’s Define Expectations and Routing Define Expectations and Routing

GuidesGuides Strategies to Enhance Your T & L ‘Buy’Strategies to Enhance Your T & L ‘Buy’


Purchasing Transportation and Purchasing Transportation and 3PL Profile3PL Profile

This is a template that: This is a template that: ConsidersConsidersAppreciatesAppreciatesUnderstands Understands

The following:The following:Corporate philosophy and cultureCorporate philosophy and cultureSupplier and inbound requirementsSupplier and inbound requirementsInternal/external customer requirementsInternal/external customer requirements


Supply Chain USA 1Supply Chain USA 1

Airport

Port

Option 1 - Ship

Option 2 - Air

Port

Airport

CustomsBroker

DC USA•Inspection•Warehousing•Pick, Pack•Shipping

CustomerTD

Returns

ShopsFL, LH

Returns

DC Bremen•Inspection•Warehousing•Shipping

Timing (days) Alt 1 A (Sea) Alt 1 B (Air) Cost / Week (US) Alt 1 A (Sea) Alt 1 B (Air)

Min Max Min Max

Available in USA 16 d 25 d 8 d 10.5 d

Order Cycle FL/LH 2 d 2 d 2 d 2 d Total US 43,800 71,400

Order Cycle TD 2 d 6 d 2 d 6 d US per LE 1.87 3.05


Purchasing Transportation and Purchasing Transportation and 3PL Profile Con’t3PL Profile Con’t

Map all locations:Map all locations: Company inbound/outbound locationsCompany inbound/outbound locations

PlantsPlants Warehouse/DCsWarehouse/DCs

Supplier locationsSupplier locations Customer locationsCustomer locations Ports and major consolidation pointsPorts and major consolidation points Major traffic flow lanesMajor traffic flow lanes

Collect traffic flow data for aboveCollect traffic flow data for above Article descriptionArticle description Alpha and numeric STCCAlpha and numeric STCC Bulk or packagedBulk or packaged Quantity or volume per shipment per time periodQuantity or volume per shipment per time period


Facility Location MapFacility Location Map——

ExampleExample


Freight Traffic Flow Major LanesFreight Traffic Flow Major Lanes——

ExampleExample


Purchasing Transportation and Purchasing Transportation and 3PL Profile Con’t3PL Profile Con’t

Define expenditures and analyze spend:Define expenditures and analyze spend:Origin/destinationsOrigin/destinationsCarriers and 3PLsCarriers and 3PLsFreight rates-both line haul and accessorialFreight rates-both line haul and accessorialWarehouse rates-both storage and in/outWarehouse rates-both storage and in/outFreight and sales termsFreight and sales termsProduct specification/STCC/NMFC/UFCProduct specification/STCC/NMFC/UFCProduct weight and packagingProduct weight and packaging


Transportation SpendTransportation Spend——

ExampleExample

FREIGHT ITEM MISC Sum

Amount SUM

PCT AmountSUM

PCT AmountSUM

PCT

Vendor Name

SNL DISTRIBUTION INC $39,345.44 6.6% $554,802.41 93.4% $594,147.85

CARGILL $33,806.56 5.7% $559,368.12 94.1% $1,560.92 0.3% $594,735.60

AZTECA $26,993.57 7.8% $319,598.24 92.1% $396.00 0.1% $346,987.81

GENERAL MILLS $20,128.26 12.3% $143,434.59 87.7% $163,562.85

BEMIS COMPANY $11,916.56 1.0% $1,177,949.07 99.0% $1,189,865.63

ROMAN MEAL $11,607.23 14.1% $69,833.37 84.9% $828.98 1.0% $82,269.58

DANISCO USA INC $10,994.43 5.1% $204,547.20 94.9% $215,541.63

SUNMAID GROWERS $9,311.00 6.4% $134,867.41 92.9% $967.60 0.7% $145,146.01


Transportation SpendTransportation Spend——ExampleExample


Transportation SpendTransportation Spend——ExampleExample

Destination Mill Owner

Total CostsPer

Truckload

AverageCost

Per DayApproximate AnnualTransportation Costs

Port Hudson, LA GP $ 218 $ 655 $ 229,021

Pineville, LA IP $ 330 $ 330 $ 158,217

Bogalusa, LA I $ 429 $ 1,287 $ 486,320

Monticello, MS GP $ 509 $ 2,035 $ 643,277

Vicksburg, MS IP $ 512 $ 1,024 $ 357,051

DeRidder, LA Boise $ 482 $ 965 $ 273,429

Hodge, LA S $ 527 $ 1,055 $ 344,929

Bastrop, LA IP $ 569 $ 1,138 $ 475,017

Campti, LA W $ 526 $ 1,577 $ 504,162

Mansfield, LA GP $ 571 $ 1,142 $ 298,676

West Monroe, LA R $ 568 $ 1,135 $ 476,285

Orange, TX I $ 566 $ 1,133 $ 444,378

Crossett, AR GP $ 631 $ 1,892 $ 716,182

Evadale, TX MW $ 697 $ 2,787 $ 884,308

Texarkana, TX IP $ 837 $ 2,510 $ 871,975

Pine Bluff, AR IP $ 851 $ 1,702 $ 653,819

Pine Bluff, AR Inland $ 851 $ 851 $ 185,523

Lufkin, TX A $ 821 $ 821 $ 214,614

Ashdown, AR D $ 885 $ 5,312 $ 1,697,178

TOTAL $29,351 $ 9,914,359


Don’t Forget…Plan for the FutureDon’t Forget…Plan for the Future

Where is your business headed in Where is your business headed in the next 12, 24, and 36 months?the next 12, 24, and 36 months?

What are the major initiatives that What are the major initiatives that will have an impact on what you will have an impact on what you expect from your carriers and/or expect from your carriers and/or third parties? third parties?

What risk and costs factors may What risk and costs factors may affect your transportation and 3PL affect your transportation and 3PL budget forecasts?budget forecasts?


Purchasing Freight Modal Profile by # of Purchasing Freight Modal Profile by # of Shipments—Shipments—

Based on Weight of Shipment and Distance Based on Weight of Shipment and Distance ShippedShipped

DistanceDistance

milesmiles<1,000 <1,000

lbslbs1,000-1,000-

1,999 lbs1,999 lbs10,000-10,000-29,999 29,999

lbslbs

30,000-30,000-59,999 59,999

lbslbs

60,000-60,000-89,999 89,999

lbslbs

90,000-or 90,000-or more lbsmore lbs

<100<100

100-199100-199

200-499200-499

500-750500-750

750-1,000750-1,000

1,000-1,000-1,4991,499

1,500 or 1,500 or moremore


Freight Modal Shipment Volume Freight Modal Shipment Volume AnalysisAnalysis

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1-5 lbs 70-150 lbs 10,000 lbs 40,000 lbs 60,000 lbs

MODAL WEIGHT BREAKS

PCT PER MODE

Water Rail TL LTL Air Parcel


Performance Comparison for Selected Freight ModesPerformance Comparison for Selected Freight Modes

Barge

Hopper Car

100 Car Train Unit

Semi-Trailer truck

1500 Tons52,500 Bushels453,600 Gallons

100 Tons3,500 Bushels30,240 Gallons

10,000 Tons350,000 Bushels3,024,000 Gallons

26 Tons; 910 Bushels7,865 Gallons9,000 for a tanker truck

124 tons

Capacity

5

57.7(865.4 for 15 barges in tow)

Truck EquivalencyVehicle

3.8

384.6

1

Post-Panamax containership5,000 TEU 2,116

9,330VLCC

300,000 tons2 million barrels of oil

747-400F


Purchasing Transportation Profile—Purchasing Transportation Profile—Affect Modal DecisionsAffect Modal Decisions

Rail generally competes with truck on Rail generally competes with truck on freight movements of more than 750 freight movements of more than 750 miles.miles.

About 15-25% of rail movement business About 15-25% of rail movement business is truck competitive.is truck competitive.

Rail transit times for most bulk and break-Rail transit times for most bulk and break-bulk cargo are roughly equal to barge bulk cargo are roughly equal to barge transit times within 750 miles and are transit times within 750 miles and are days shorter beyond 1000 miles.days shorter beyond 1000 miles.

High-value goods and time-sensitive goods High-value goods and time-sensitive goods are likely to move through faster, more are likely to move through faster, more expensive modes of transportation like air.expensive modes of transportation like air.



Potential to convert TL to intermodal when Potential to convert TL to intermodal when distance in excess of 1,000 miles and not distance in excess of 1,000 miles and not time sensitive.time sensitive.

Competition for long-haul highway Competition for long-haul highway shipments in particular are becoming shipments in particular are becoming noticeably more intermodal as trucking noticeably more intermodal as trucking companies have shifted line haul movement companies have shifted line haul movement legs to railroad TOFC or COFC movements. legs to railroad TOFC or COFC movements.

About 90% of intermodal container traffic is About 90% of intermodal container traffic is potentially rail vs. truck competitive potentially rail vs. truck competitive

Much of the international intermodal Much of the international intermodal business through the ports lends itself more business through the ports lends itself more practically to rail moves and possibly barge.practically to rail moves and possibly barge.



If you have to ship over 1,000 miles, you If you have to ship over 1,000 miles, you may want to consider a national LTL carrier may want to consider a national LTL carrier over a regional LTL carrier. These firms over a regional LTL carrier. These firms offer the advantage of not having to offer the advantage of not having to interline freight traveling long distances. interline freight traveling long distances.

Private internal fleets are expanding to take Private internal fleets are expanding to take on shorter distance LTL or TL moves.on shorter distance LTL or TL moves.

Don’t assume that air means “you hear the Don’t assume that air means “you hear the roar of jet engines” ; if the carrier can move roar of jet engines” ; if the carrier can move your freight on what it calls an ‘expedited your freight on what it calls an ‘expedited truck’ and get it to your destination in the truck’ and get it to your destination in the timeframe you specified---it may never see timeframe you specified---it may never see the tarmac. Also don’t expect any great cost the tarmac. Also don’t expect any great cost savings to result. savings to result.


Modal Decisions Translate Modal Decisions Translate to Carrier Optionsto Carrier Options

• LTL/FTL

• Parcel

• Ocean

• Rail

• LTL/FTL

• Parcel

• Ocean

• Rail

Shipping Modes Carrier Options

Orders



Review your shipping profile statistics Review your shipping profile statistics and understand where the economic and understand where the economic shift points are in your:shift points are in your:Parcel or Air/LTL mixParcel or Air/LTL mixLTL/TL mixLTL/TL mixTL/Rail mixTL/Rail mixAir/Ocean mixAir/Ocean mix

Over 90% of all organizations are Over 90% of all organizations are either receiving and/or shipping either receiving and/or shipping internationally internationally


Comparison of Distribution Costs and Time from National Warehouses—Comparison of Distribution Costs and Time from National Warehouses—ExampleExample


Bottom Line:Bottom Line:

A company should define a A company should define a lane, process, operation, or lane, process, operation, or function that can be function that can be improved, then make these improved, then make these carriers and 3PL providers carriers and 3PL providers compete for it.compete for it.

Bottom Line:Bottom Line:

A company should define a A company should define a lane, process, operation, or lane, process, operation, or function that can be function that can be improved, then make these improved, then make these carriers and 3PL providers carriers and 3PL providers compete for it.compete for it.

Thoughts About ChoicesThoughts About ChoicesThoughts About ChoicesThoughts About Choices


The Four S’sThe Four S’s

SourceSource

SolicitSolicit

SelectSelect

SecureSecure


The Four S’s: SourceThe Four S’s: Source

Identify Logistics Identify Logistics and Transportation and Transportation requirements:requirements: Review and clarify Review and clarify

req’mtsreq’mts Obtain feedback on Obtain feedback on

3PLs and carriers3PLs and carriers Review KPIs, KRAs, Review KPIs, KRAs,

and analyze gapsand analyze gaps Establish which gaps Establish which gaps

are most criticalare most critical


Material Flow DC USAMaterial Flow DC USA——Daily 4 Month AverageDaily 4 Month Average

Supply Chain Alternatives

Goods In

0.8 Trucks/day

21 Pal/day (Euro) 5 Pal/day

Division Shop, Concessions Division T-Direct

17 Pal/day (Euro) 4 Pal/day (Euro)

2,060 Picks/day 640 Picks/day

Returns

5 Pal/day

Others

Pick / Pack

Goods Out

183 Cartons/day172 Cartons/day172 Cartons/day 5 Pal/day

Shop, Concession14 Pal/day

1.5 Trucks/day

Direct5 Pal/day

0.5 Truck/day

Others5 Pal/day

0.5 Trucks/day



Gather data and manipulate Gather data and manipulate information:information:Compile or obtain 6-12 months of Compile or obtain 6-12 months of

history/activity req’mtshistory/activity req’mtsObtain details: inbound and outbound; Obtain details: inbound and outbound;

origins and destinations; weight, origins and destinations; weight, cube and # of pieces; traffic lanes, cube and # of pieces; traffic lanes, supply chain streams, and demand supply chain streams, and demand chain streams; types of equipment; chain streams; types of equipment; volatility and performance req’mtsvolatility and performance req’mts



Create a RFI: Create a RFI: Review 3PLs’ and carriers’ company Review 3PLs’ and carriers’ company

and public profilesand public profiles Invite both current and Invite both current and new new sourcessources Get: completed profile questionnaires, Get: completed profile questionnaires,

financials, insurance and safety financials, insurance and safety certificates, authority or operating certificates, authority or operating documents, and referencesdocuments, and references

• Perform site visit when applicable. Talk Perform site visit when applicable. Talk with local management.with local management.


Trucker RFI Compilation and Status—Example—Example

Company Name Blue Flash Dupre Savage Omni Interest Level High High High MediumOwn Pneumatics Yes No Yes No24/7 Service Yes Yes Yes YesRate Flexibility Yes Yes Yes YesOwn Terminals Yes Yes Yes NoFull Time Drivers Yes Yes Yes NoSub-Contractors Yes Yes Yes OnlyAct as 3PL Option Option Must MustRegional Exp Yes Yes Yes NoNational Exp Yes No Yes Yes

© 2003 CATTAN Services Group, Inc.© 2003 CATTAN Services Group, Inc.


The Four S’s: SolicitThe Four S’s: Solicit

Develop a RFB/RFP: Develop a RFB/RFP: Decide which 3PLs and carriers receive Decide which 3PLs and carriers receive

solicitation based on RFI resultssolicitation based on RFI resultsDetermine your preferred pricing and Determine your preferred pricing and

contract formats contract formats Specify whether bid/proposal by lane Specify whether bid/proposal by lane

allocation, region or complete scopeallocation, region or complete scopeInclude TCA/NITLInclude TCA/NITL Voluntary Guidelines Voluntary Guidelines

to Good Business Relationsto Good Business Relations


The Four S’s: SolicitThe Four S’s: Solicit Send bid/proposal package to qualified Send bid/proposal package to qualified

sources: sources: Prepare a template with details of info Prepare a template with details of info

gatheredgatheredProvide clear instructions concerning info Provide clear instructions concerning info

you want includedyou want includedAttach a copy of anticipated contract and Attach a copy of anticipated contract and

T&Cs upfrontT&Cs upfrontProvide sample performance reports to be Provide sample performance reports to be

used as measures of agreed performanceused as measures of agreed performanceEstablish what is a responsive bid/proposal Establish what is a responsive bid/proposal

and adequate submission dateand adequate submission date


Information Gathered TemplateInformation Gathered Template—Example—Example

Note: BH means backhaul opportunity


A carrier or 3PL can perform services which an A carrier or 3PL can perform services which an organization is either unwilling or unable to perform organization is either unwilling or unable to perform itself, but are they as good as advertised? itself, but are they as good as advertised?

A carrier or 3PL can perform services which an A carrier or 3PL can perform services which an organization is either unwilling or unable to perform organization is either unwilling or unable to perform itself, but are they as good as advertised? itself, but are they as good as advertised?

First we need to determine who they are and what they offer.First we need to determine who they are and what they offer.

The question is:The question is:


• Financial Performance and HealthFinancial Performance and Health

• StaffingStaffing

• Assets and FacilitiesAssets and Facilities

• Internal and External ProgramsInternal and External Programs

• Pricing Methods, Utilization, Periodic ReviewPricing Methods, Utilization, Periodic Review

• Measures of Agreed PerformanceMeasures of Agreed Performance

• OperationsOperations

• Financial Performance and HealthFinancial Performance and Health

• StaffingStaffing

• Assets and FacilitiesAssets and Facilities

• Internal and External ProgramsInternal and External Programs

• Pricing Methods, Utilization, Periodic ReviewPricing Methods, Utilization, Periodic Review

• Measures of Agreed PerformanceMeasures of Agreed Performance

• OperationsOperations

The Seven Most Important The Seven Most Important Considerations To Include When Considerations To Include When

Choosing Choosing Carriers


1. FINANCIAL STRENGTH

2. BUSINESS EXPERIENCE

3. BUSINESS DEVELOPMENT

4. SUPPORT SERVICES

5. BUSINESS ARRANGEMENTS AND PRICING

1. FINANCIAL STRENGTH

2. BUSINESS EXPERIENCE

3. BUSINESS DEVELOPMENT

4. SUPPORT SERVICES

5. BUSINESS ARRANGEMENTS AND PRICING

The Five Most Important Considerations To The Five Most Important Considerations To IncludeInclude

When Choosing A Contract Logistics FirmWhen Choosing A Contract Logistics Firm

The Five Most Important Considerations To The Five Most Important Considerations To IncludeInclude

When Choosing A Contract Logistics FirmWhen Choosing A Contract Logistics Firm


The Four S’s: SolicitThe Four S’s: Solicit

Hold a Pre-Bid/Proposal Conference: Hold a Pre-Bid/Proposal Conference: Invite qualified bidders and proposersInvite qualified bidders and proposersDiscuss expectationsDiscuss expectationsHold Q&AHold Q&AProvide feedback and answers to all: Provide feedback and answers to all:

During conference During conference After conferenceAfter conference


The Four S’s: SelectThe Four S’s: Select

Verify documentation submittedVerify documentation submitted Establish T&Cs that may require Establish T&Cs that may require

adjustment, compromise or negotiationadjustment, compromise or negotiation Analyze bid or proposal submissionsAnalyze bid or proposal submissions Develop selection criteria or negotiation Develop selection criteria or negotiation

strategystrategy Use analytical tools to select. Do industry Use analytical tools to select. Do industry

comparisons for the type of customers, comparisons for the type of customers, facilities, regional, coverage, management facilities, regional, coverage, management and cultural attitudes, cost model, etc.and cultural attitudes, cost model, etc.

Select or conduct negotiationSelect or conduct negotiation


Bid or Proposal Analysis—Bid or Proposal Analysis—ExampleExample

Truckload CHRW

Origin Equipment Rated Per mile/ Trailer FSC

City State Zip Required Miles Flat Fee Size Extension 1/29/2007 TOTAL

Moncks Corner SC 29461 DRY 1101 $ 1.40 48/53 $ 1,541.40 252.23 $ 1,793.63

Cairo GA 31728 DRY 830 $ 1.15 48/53 $ 954.50 190.15 $ 1,144.65

Lithia FL 33547 DRY 1112 $ 1.05 48/53 $ 1,167.60 254.75 $ 1,422.35

Brooksville FL 34609 DRY 1074 $ 1.05 48/53 $ 1,127.70 246.04 $ 1,373.74

Groveland FL 34736 DRY 1069 $ 1.05 48/53 $ 1,122.45 244.90 $ 1,367.35

Loxley AL 36551 DRY 614 $ 1.79 48/53 $ 1,099.06 140.66 $ 1,239.72

Red indicates low bidder on traffic lane


Thoughts About ChoicesThoughts About ChoicesThoughts About ChoicesThoughts About ChoicesWhich is a more important category to your company: Warehousing, Transportation, IT, other?Which is a more important category to your company: Warehousing, Transportation, IT, other?

Choose a firm that has its roots in that category.

Do they have a local or regional office nearby your facility or headquarters.Do they have a local or regional office nearby your facility or headquarters.

A local or regional office lends more control to you.

Meet with the actual operations personnel, not just sales, to determine their personal chemistry with you and their fit with your corporate culture.

Meet with the actual operations personnel, not just sales, to determine their personal chemistry with you and their fit with your corporate culture.

Your comfort level is an important key to success.

Know your costs for comparison to theirs.Know your costs for comparison to theirs.

Agree upon measurement criteria in advance. Agree upon measurement criteria in advance.

Remember, you are paying for their profit margin too.

Know when to fix things or to leave them alone.


The Four S’s: SecureThe Four S’s: Secure

Provide contracts to selected providersProvide contracts to selected providersEmphasize Emphasize LLong ong TTerm erm RRelationshipelationshipMonitor 3PLs’ and/or carriers’ Monitor 3PLs’ and/or carriers’

performance, costs and commitments—performance, costs and commitments—use scorecarduse scorecard

Issue company routing guideIssue company routing guideSeek continuous improvement and Seek continuous improvement and

incorporate feedback incorporate feedback to and fromto and from Hold IPRs and provide a performance Hold IPRs and provide a performance

report card on a regular interval report card on a regular interval


Define ExpectationsDefine Expectations

In the wonderful world of expectations we In the wonderful world of expectations we have a problem:have a problem:

The buyers/shippers want everythingThe buyers/shippers want everything The Carriers or 3PLs want the businessThe Carriers or 3PLs want the business The suppliers and customers want things The suppliers and customers want things

alsoalso In theory, everything is possibleIn theory, everything is possible In reality, there are constraints In reality, there are constraints


Why Use Routing Guides?Why Use Routing Guides?Are used to provide guidance and rules Are used to provide guidance and rules

for any transportation and logistics for any transportation and logistics scenariosscenarios

Are part of contractual obligations for Are part of contractual obligations for suppliers and internal/external customerssuppliers and internal/external customers

Are used identify each carrier and 3PL Are used identify each carrier and 3PL that you dictate by price/service for use that you dictate by price/service for use by any suppliers and customersby any suppliers and customers

Are used to identify the shipment size, Are used to identify the shipment size, volume, and weight for each carrier and volume, and weight for each carrier and 3PL to be used3PL to be used

CATTAN Services Group, Inc. 43

CATTAN Services Group, Inc. 44

Carrier Selection—Oracle Carrier Selection—Oracle ExampleExample

• Weight• Volume• Geographic Regions

InputsInputs ResultsResults

Rule Criteria

Carrier Selection Process

• Carrier• Service Type• Mode • Payment Terms

Selection Results

Rules Based Selection Process


Basic Modal Routing Guide—Basic Modal Routing Guide—ExampleExample


Domestic Ground Routing GuideDomestic Ground Routing Guide—Example—Example

Shipment Weight and Transit Days

201 – 9000 pounds

Origin States Small Package

Transit1 Day 2 Days 3 Days 4–6 Days Truck Load

MD, DC (Local) 1 Day EXCEL EXCEL N/A N/A N/A

CT, MA, MD, NH, NJ, NY, PA, RI, VT

2-3 Days New Penn New Penn N/A N/A CFI or Schneider

ME 3 Days New Penn New Penn New Penn N/A CFI or Schneider

AR, IA, KS, LA, MN, MS, ND, NE, OK, SD, TX

5-7 Days FedEx 1 Day FedEx 2Day FedEx 2Day Yellow Freight CFI or Schneider

AZ, CA, CO, ID,MT, NM, NV, OR, UT, WA, WY

5-7 Days FedEx 1 Day FedEx 2Day FedEx 2Day Yellow Freight CFI or Schneider

AK, HI N/A FedEx 1 Day FedEx 2 Day N/A N/A N/A

For shipments over 9000 pounds, truck load movements, shipments requiring special handling, or shipments between suppliers, contact your buyer for special instructions.


International Routing Guide—International Routing Guide—ExampleExample

INTERNATIONAL ROUTINGS

ORIGIN COUNTRY/REGION AIR FORWARDER OCEAN FORWARDER

Europe/Ukraine Expeditors Expeditors

Africa Expeditors Expeditors

India Expeditors Expeditors

Japan Expeditors Expeditors

Hong Kong Expeditors Expeditors

Taiwan Expeditors Expeditors

Shanghai Expeditors Expeditors

Malaysia Expeditors Expeditors

Singapore Expeditors Expeditors

Central and S. America Expeditors Expeditors

Canada and Mexico Emery/Menlo N/A

All Other Origins Expeditors Expeditors

Shipments in excess of 500 pounds or 227 Kg need authorization to ship via Air.


International Routing Guide—International Routing Guide—ExampleExample


Rail Routing Guide—ExampleRail Routing Guide—Example


Air Routing Guide—ExampleAir Routing Guide—Example

DOMESTIC AIR SHIPMENTSNote: Second Day Service if PO delivery date permits;

Overnight Air Express if PO delivery requires.

1-150 lb.< 68 kg

Small package shipments requiring overnight service purchased FOB freight collect within the 50 states

DHL ® Priority overnight service

150-500 lb.> 68 kg

Small package shipments requiring overnight service purchased FOB freight collect within the 50 states

EGL Eagle Global Logistics

> 501 lb.> 1105 kg

Contact Traffic Administrator, provide the weight, dimensions, freight description and PO Number

(618) 7xx-1220 Phone(618) 5xx-3677 Fax


Truck Routing Guide—Truck Routing Guide—ExampleExample

ST ORIGIN STATE

Zip Code

Less Than Truckload (LTL)

LTL to TL transition (Pounds)

Use 'TL' If shipment is over 1/2 the visible capacity of a 48" vehicle or exceeds pounds

AL Alabama All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority, May

AZ Arizona All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, May

CA California All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, May

DE Delaware All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Priority, May

FL Florida All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Priority, May, Prime

GA Georgia All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority, May

IA Iowa All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority, May

ID Idaho All FedEx Freight 10 Pallets or 10,000 Lbs May, Navajo, Prime

KS Kansas All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, M. Bruenger, Prime

KY Kentucky All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority, May

LA Louisiana All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority, May

MD Maryland All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Priority, May

ME Maine All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Priority, May

MI Michigan All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority, May

MN Minnesota All FedEx Freight 10 Pallets or 10,000 Lbs Navajo, Prime, Priority


Truck Routing Guide—Truck Routing Guide—ExampleExample

LTL Common CarrierLTL (Less Than Truckload) Routing

Shipments under 10,000 lbs.In Order of Preference

State Preferred Carrier 2nd Preferred Carrier

Alabama Yellow Freight UPS Freight

Arizona UPS Freight Yellow Freight

Arkansas UPS Freight Yellow Freight

California UPS Freight Yellow Freight

Colorado Yellow Freight UPS Freight

Connecticut UPS Freight Yellow Freight

Delaware Yellow Freight UPS Freight

Washington D.C. UPS Freight Yellow Freight


Strategies to Enhance Your Strategies to Enhance Your Transportation and Logistics Transportation and Logistics

‘Buy’‘Buy’Extend the processes beyond the walls Extend the processes beyond the walls

of purchasing, traffic, and logisticsof purchasing, traffic, and logisticsCreate strategies to buffer yourself Create strategies to buffer yourself

against:against:Capacity ShortagesCapacity ShortagesReliability IssuesReliability IssuesRate or Price HikesRate or Price Hikes

Possible strategies for consideration Possible strategies for consideration followfollow


Strategies to Create Greater Strategies to Create Greater CapacityCapacity

Adding consolidation/de-consolidation centers to global Adding consolidation/de-consolidation centers to global distribution networks so freight gets moved as FCL and FTLdistribution networks so freight gets moved as FCL and FTL

Looking for ways to extract more capacity from private Looking for ways to extract more capacity from private fleets and facilities by:fleets and facilities by: Improving cube utilization of fleet equipmentImproving cube utilization of fleet equipment Improving facility cube and storage capacityImproving facility cube and storage capacity Eliminating empty truck miles and ‘dead heads’Eliminating empty truck miles and ‘dead heads’ Consolidating orders to same destination or customerConsolidating orders to same destination or customer Using a carrier appointment scheduling or “order notify” Using a carrier appointment scheduling or “order notify”

systemsystem

Rethinking your transportation and logistics network design Rethinking your transportation and logistics network design and inbound/outbound flow of shipmentsand inbound/outbound flow of shipments

Making your freight traffic or warehouse operations Making your freight traffic or warehouse operations attractive to the service providersattractive to the service providers


Strategies to Create Greater Strategies to Create Greater ReliabilityReliability

Forging close collaborative ties with their carriers and 3PL Forging close collaborative ties with their carriers and 3PL providersproviders

Establishing preferred customer status or dedicated contract Establishing preferred customer status or dedicated contract carriage and/or contract warehousingcarriage and/or contract warehousing

Consolidating multiple carrier and 3PL provider relationships Consolidating multiple carrier and 3PL provider relationships by traffic lane, region, or geographic areaby traffic lane, region, or geographic area

Increasing volume with premium operators where service is a Increasing volume with premium operators where service is a differentiating factor---not the low price or discounted differentiating factor---not the low price or discounted carriers/providers carriers/providers

Treat carriers and 3PLs as partners in the commitment to Treat carriers and 3PLs as partners in the commitment to

100% on-time performance100% on-time performance

Identifying root causes of service failures and cost overruns by Identifying root causes of service failures and cost overruns by using scorecards and measures of agreed perofrmanceusing scorecards and measures of agreed perofrmance


Strategies to Create Greater Price Strategies to Create Greater Price StabilityStability

Update the granularity and accuracy of your systems to:Update the granularity and accuracy of your systems to: Create efficient freight lanes and facility networksCreate efficient freight lanes and facility networks Leverage aggregated spend to negotiate better prices, rates, and Leverage aggregated spend to negotiate better prices, rates, and

charges on a contract basischarges on a contract basis Know when to bundle or unbundle goods and transportation costs Know when to bundle or unbundle goods and transportation costs

for freight auditing purposes and checking supplier costsfor freight auditing purposes and checking supplier costs Help calculate costs per supplier, per customer, per product or Help calculate costs per supplier, per customer, per product or

SKU, per geographic area or business unit, per facility or site, etc.SKU, per geographic area or business unit, per facility or site, etc.

Employ total delivered or landed cost analysis and optimizationEmploy total delivered or landed cost analysis and optimization

Use shipment optimization and electronic tendering softwareUse shipment optimization and electronic tendering software

Monitor sources of transportation and logistics data for trends Monitor sources of transportation and logistics data for trends and forecastsand forecasts

Enforce compliance with your routing guide to avoid Enforce compliance with your routing guide to avoid transportation and logistics exceptionstransportation and logistics exceptions


Thank You !Thank You !