New Freight Cost Analysis Technology for the 21st Century Freight Controller

New Freight Cost Analysis Technology for the 21st Century

What if you felt comfortable saying to the Director “I guarantee that I can lower our freight costs by 15%”? Can you imagine yourself doing that? Let me help you get there.

Most seasoned veterans of the freight industry would not make such a blanket guarantee. They realise how difficult it would be to live up to such a declaration. If anything went wrong, they would face the displeasure of the Director, but if they pulled it off they will face the admiration and gratitude of the Director. Wouldn’t that be nice?

If you’ve been in freight for a while then you would have a pretty good idea of what would be a good quote for a 1.2m high pallet from Melbourne to Sydney. You’re good at glancing at rates that carriers provide when you decide that you can’t put off your mandate to review your freight rates any longer.  You can see that 24 cents per kilo is better than 26 cents, and you double check the impact of the different cubic conversions and basic charges, etc.

Sure, you can’t go line by line through every rate and compare post code files of different carriers to see if your customer in a small country town in South Australia is in Zone 1 for this carrier and Zone 2 for the next, but you can guesstimate the result. Knowing this you might add some margin for error and promise 10% reduction in freight costs to the Director for making the swap instead of the 15% you hope it will be.

But what happens if, you’re like one of our clients who turned to us after they independently made the swap and found to their horror that, the price had gone up instead of down? In this instance it was because the new carrier had placed their postcode sender location in QLD Zone 1, whereas the incumbent carrier placed them in Brisbane. It made no difference that the ex-Brisbane rate was lower with the new carrier since they hadn’t realised they would be paying an extra 4c per kilo from their location on top of that.

If you have experienced something like this, then you would never see yourself making guarantees. And yet, this is just one story of where a client missed a critical component of the cost of the change in carriers. I’m betting that you have probably heard of similar cautionary tales.

So, how can you guarantee yourself, your staff, and your Director, that you won’t ever make that type of error again? How can you be sure,

  • before you tell your old carrier with the friendly driver who comes in and helps with the loading every day at 3pm,
  • before you change the layout of the sorting in the warehouse to suit the new carriers process for transportation,
  • before you add their labels & con note range into your system (or worse still, install their software and re-train your staff),
  • before you fill in the Credit Application forms and so on,

that you aren’t going to end up with egg on your face and a very unhappy group of colleagues?

It’s enough to keep you in the status quo, and justifying to anyone who questions, (the CFO and Director for starters), why you’re best off staying put with the incumbent, even though their service levels have recently been slipping.

You are ‘between a rock and a hard place.’ And so, the carriers end up with all the control.

The problems, as you suspect, are with the systems (or pardon the bluntness – the lack thereof), that you have in place for analysing the impact a new carrier and their rates will produce. Sure, you’ve probably also tried to use outside help, a consultant brought in for a six month project, or a freight broker.

They have years’ experience to match yours. They tell you all about their superior service capabilities for matching freight need to a range of carriers, perhaps some you wouldn’t have considered, or been aware of. They probably use some spreadsheets of rates with their list of carriers that they can compare against your rates (if you are willing to provide them), that a staff member at their office is manually adding and formatting to compare.

But in the end the rates did not appear any better than what you can command on your own and were a waste of time. That’s because freight brokers can no longer demand lower rates from ‘bulk buying’, as carriers push back against this incentive due to the logistics of still needing to pick up from a variety of different, stretched out locations.

Therefore, if you are familiar with the scenario that I have painted, you end up back where you started, but in effect worse than where you started, because the time and effort you and your people have put in to the change has not come to fruition.

I stated at the start that I could show you how you can guarantee the result, and that’s because at Freight Controller we guarantee the result. Our model is not the traditional Freight Broker model; instead we provide a new model that provides improved results for our customers and we guarantee it.

Freight Controller’s improved processes, technology and automation that are enabled by the evolution occurring within the supply chain – as a result of the quintessential need for accuracy required for our customers’ continuous improvement commitments, have led to a new model for measuring and forecasting a myriad of potential options a specific client  can undertake. Using your historical freight data we can precisely forecast on a line by line and bottom line basis the result of a hypothetical switch before it happens.

Coupling this with our 30 years’ experience in the Australian freight industry, and our independent, (not supplier list), method of carrier selection that matches issues with solutions, we can tell you precisely the outcome across all of your carriers with a multiple of new possible carriers based upon your current freight profile.

This is all done in the timeliest manner using our powerful in-house technology. So there’s no danger of waiting around for weeks and weeks for a less than stellar result from a prospective carrier.

We’re in the business of providing you with peace of mind. You can relax and get on with your day, growing your business and satisfying your customers, while we put the pieces of the puzzle together in a comprehensive, confidential review with transparent report & analysis on results, so that you can pass on our guarantee to your Director without even a twinge of doubt.

Make the change to the new freight partnership model of the 21st Century and we guarantee you and your company will not look back.

Share this blog with your network:

Share on facebook
Share on twitter
Share on linkedin