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.H. R

obinson Worldw

ide, Inc. All Rights R

eserved. ©

2013 C.H

. Robinson W

orldwide, Inc. All R

ights Reserved.

A Transportation Industry and Market Discussion

March 18, 2014

2

Global Network and Services

Truckload Powerful truckload network—everything from transactional to dedicated fleet—for the most capacity options for your shipments

LTL/Consolidation One call for virtually any kind of LTL freight—temperature controlled, cross-border, expedited, and even flatbed

Ocean Rated the number one NVOCC on the Trans-Pacific Eastbound (Asia to U.S.) and the leading LCL carrier on the Trans-Pacific

Customs Fourth largest Customs House Brokerage in North America—Trusted Advisor® experts dedicated to delivering best practices in global forwarding and trade policy

Intermodal Comprehensive, route neutral, North American solutions from a Top 5 IMC with direct programs on all Class 1 Railroads

Air Convenient domestic and global air freight services for your most time-sensitive freight

Sourcing Fifth largest produce company in North America with proprietary and national brands, and a wide range of services—P.O. management to fulfillment

Management Services Integration of a single global technology platform, supply chain expertise, and consulting services Global TMS technology + Managed Services, offered through TMC, a division of C.H. Robinson

8 Core Service Lines

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Cheap is not always Best

Low cost Negotiation - Procurement

Budget Sum of low costs or broader strategy

Time Does a plan hold firm over time

Attractive Attributes withstand pressure

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Key Trucking trends in the USA

Recession Asset contraction holds

Regulation HOS, CSA, CARB, EOBR etc.

#1 issue Driver shortage key to capacity

#2 issue “It’s the economy…”

IMDL Attractive mode shift

Supply or Demand?

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.H. R

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Winter 2013-2014

http://weatheradvance.com/

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YOU CANT MOVE THE MARKET, BUT… Shippers can approach the market most attractively and mitigate impacts with process compliance.

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Stale Rates Research: Benefits of Frequent Transportation Bids

What was found… A predictable strategy and schedule can deliver cost savings

Question: How often should shippers put their freight out to bid?

Question: What is the

effectiveness of procurement events?

Question: What can be

learned about how carriers honor

rates?

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Findings: up to $40 per shipment benefit

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Increase Lead times, Decrease Costs

Question: Could altering lead time prevent deeper route guide penetration?

What was found… Route guide depth does drive transportation costs

Question: Does the amount of lead time affect total transportation costs?

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Findings: Deeper into the route guide, greater the $/Mile

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Findings: Tender lead time effects load acceptance

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Aggregate Low Volume Lanes

Observation: 85% of loads are in lanes with 15 loads or fewer in a year.

Question: Can aggregating lanes

lower truckload costs?

Question: Do spot rates cost

more than contract rates?

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Bid lanes in multiple ways:

Point to Point

Point to region

Region to point

Region to region What was found… • Reengineering lane boundaries and

aggregating volume, lowers realized trucking costs.

• Spot rates by in large will be higher than contract rates

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.H. R

obinson Worldw

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Pending Research: Favored attributes

Question: What are the attributes of a shipper that are most attractive to the carrier community?

Initial findings… Top attribute reported by carriers is turn time at Pick &Delivery

Question: Do these attributes truly effect transportation costs?

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Why might my transportation budget fail?

Things we can influence • Shipment Size

• Lead Time

• Transit Time

• Modal Shifting

• Location Mix

• Product Mix

• Changes to Demand Consistency

• Production Shifts

• Changes in Oil Prices

• Customer or Supplier influenced charges

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.H. R

obinson Worldw

ide, Inc. All Rights R

eserved.

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Why might my transportation budget fail?

Things we can influence • Shipment Size

• Lead Time

• Transit Time

• Modal Shifting

• Location Mix

• Product Mix

• Changes to Demand Consistency

• Production Shifts

• Changes in Oil Prices

• Customer or Supplier influenced charges

Measures of value • Cost per CWT

• Depth of tender

• Average Lead time

• Modal mix/shifting

• Length of haul

• Zone/corridor pattern changes

• Benchmarking

• Accessorial charges

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.H. R

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Summary

Transportation strategy Procurement strategy TMS Adhere to Processes Measure, monitor, improve

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Summary

Question: Is it Supply or is it Demand? Strategy delivers predictable and lowest costs

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.H. R

obinson Worldw

ide, Inc. All Rights R

eserved. ©

2013 C.H

. Robinson W

orldwide, Inc. All R

ights Reserved.

Thank You

March 14, 2014