Food and Beverage Transportation: 5 Tips for Sourcing Excellence


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Food & Beverage Transportation: 5 Tips for Sourcing Excellence

Food and beverage industry shippers face unique challenges across the supply chain. From inbound raw materials and specialty ingredients, to outbound finished products, food and beverage products require temperature control, traceability and special handling. Ensuring that the carriers and logistics providers you partner with to manage your freight can provide adequate services levels while keeping costs competitive adds significant complexity to your transportation sourcing activities.

View this Webinar presentation to Get 5 Tips that Will Improve Your Logistics Operations in 2013

CombineNet has worked extensively with many of the world's largest food and beverage companies to improve their transportation sourcing strategies and deliver excellent results. This presentation will share 5 tips that we have gleaned over the course of 12 years and billions of dollars of transportation spends sourced, to help you achieve exceptional results that balance cost, service and network efficiency for your transportation operations.

We will share specific examples and case studies to help you understand how next-generation e-sourcing technology has helped CombineNet's food and beverage industry customers find excellence in transportation sourcing.

Or view the webcast on demand at:

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Food and Beverage Transportation: 5 Tips for Sourcing Excellence

  1. 1. Welcome! Copyright © 2013. CombineNet, Inc.
  2. 2. Agenda Greg Holt, Director of Product Marketing, CombineNet – Introduction – CombineNet’s Role in Transportation Sourcing Jessica Fenlon, Manager, Professional Services, CombineNet – 5 Tips for Transportation Sourcing in Food and Beverage CompaniesCopyright © 2013. CombineNet, Inc.
  3. 3. CombineNet Company Overview The Company The Technology Customer Value Established in 2000. Best of Breed Solutions that Capture >2X spend under E- improve Strategic Sourcing – Sourcing management. Global: Offices in holding 21 U.S. patents. Pittsburgh, PA; London, UK; Address complex spends Hamburg, Germany. Software-as-a-Service (SaaS) with advanced functionality. Partners for Latin America, delivery model for ease of Middle East, APAC. adoption and scale Fast implementation and broad adoption for any type Customers: Global 2000 Easy integration into your of user. spanning CPG, Food & Bev, environment to complement Retail, Manufacturing, existing applications. Nearly 100% see full payback Transportation, and more. after 1st sourcing event.Copyright © 2013. CombineNet, Inc.
  4. 4. Some of CombineNet’s Customers Includes 16 of the Largest Food & Beverage Manufacturing CompaniesCopyright © 2013. CombineNet, Inc.
  5. 5. Best of Breed E-Sourcing Solutions E- Supporting End-to-End E-Sourcing for All Spend Categories with Advanced Technology SolutionsCopyright © 2013. CombineNet, Inc.
  6. 6. CombineNet ASAP in Transportation Sourcing We will help you reduce costs in logistics sourcing! ~600 transportation sourcing events per year – more than $15 billion in annual transportation spend Average savings of 10% on spend size – and 100% ROI after your first event All Modes: Truckload/IM, LTL, Ocean, Airfreight, Parcel, Multi-mode Shippers, 3PLs, Freight Forwarders and Logistics Consultants of all sizes, across all industries, use CombineNet ASAPCopyright © 2013. CombineNet, Inc.
  7. 7. How can CombineNet help you? Carrier Measurement • Flexible RFI • Assessing Carrier Capabilities, Equipment, Drivers, Carbon Footprint, Insurance, DOT Ratings Expressive Bidding • Expressive, Creative & Alternative Bids • Equipment type, transit time, mode, capacity, service, volume offers/discounts • Total Cost of Ownership Models • Rates, assessorials, fuel… Scenario Analysis & Optimization • “What If?” Scenario Models • Regional preferences, network-wide contracts, corporate business goals • Robust Reporting on Impact of Decisions CombineNet ASAPCopyright © 2013. CombineNet, Inc.
  8. 8. How Customers Use CombineNet Today Consolidating Freight Spend for Mode Switching Negotiation Leverage Explore options for moving from LTL to Truck • Network-wide bids vs. regional bids to Intermodal to Rail; • Outbound + Inbound shipments Review mode-mix for Ocean and Air • Balancing common carriers, dedicated, LSPs • Combining Dry, Refrigerated, Bulk, Container, Intermodal Carrier Collaboration: Understanding Business Strategies & Needs Review Carrier/Network Options For lane efficiencies, service & equipment Look for mutual value/win-win opportunities alternatives, carrier scalability to volume that match your shipments with their assets changes and existing business • Continuous loops/ backhauls/ multi-stop • Carrier business/expansion plans Sustainability • Utilize imbalance between Evaluating carrier/fleet fuel efficiency, network inbound/outbound & import/export in certain regions carbon footprint, mileage reduction optionsCopyright © 2013. CombineNet, Inc.
  9. 9. 5 Tips for Sourcing Excellence in Food & Bev Transportation Copyright © 2013. CombineNet, Inc.
  10. 10. 5 Tips to help Food & Beverage Transportation Buyers 1) Evaluate Carrier Support for Seasonality 2) Review Dry and Temperature Controlled Equipment Options 3) Use a Carrier Scorecard as Part of Carrier Evaluation 4) Consider Load Weight per Lane 5) Ensure Carrier Capacity CommitmentsCopyright © 2013. CombineNet, Inc.
  11. 11. Tip #1: Evaluate Carrier Support for Seasonality Your Challenge: In sourcing events, seasonality changes can have big impacts on monthly demand and capacity Consumer Demand: – “We want whole turkeys at Thanksgiving” Growing Seasons: – “It’s difficult to find some fresh vegetables during the winter in the North” Solution: Display Seasonality changes as Lane Information and collect carrier capabilitiesCopyright © 2013. CombineNet, Inc.
  12. 12. Sourcing with Seasonality in CombineNet Display Monthly Demand Patterns Collect Monthly and Peak Capacity in your CombineNet sourcing event:Copyright © 2013. CombineNet, Inc.
  13. 13. Tip #2: Review Dry and Temperature Controlled Equipment Options Your Challenge: Buyers with Dry and Temp controlled truckload often source separately – Data collection, bidding process, and analysis is time consuming – Separate internal teams but similar corporate sourcing requirements Solution: Combine Dry and Temp into one bidding event – Similar contract expiration dates – Attractive bidding opportunity for carriers – Significant internal time savings – Brokers and 3PL’s should be invited to the eventCopyright © 2013. CombineNet, Inc.
  14. 14. Sourcing Dry and Temperature Truckload in CombineNet Collect the right bids for the right lanesCopyright © 2013. CombineNet, Inc.
  15. 15. Tip #3: Use a Carrier Scorecard Your Challenge: Quantifying RFI responses for unbiased comparisons Maintaining a record of carrier capabilities and preferences throughout analysis Solution: Prioritize most important internal factors through weights for question and answer Set the weights before any carrier responses are receivedCopyright © 2013. CombineNet, Inc.
  16. 16. Carrier Scorecard – RFI Questions Add scoring weights to your RFI ConfigurationCopyright © 2013. CombineNet, Inc.
  17. 17. Carrier Scorecard – Using Scores in your CombineNet Scenario Analysis We’ll help you set up Carrier Scorecard calculations for analysis:Copyright © 2013. CombineNet, Inc.
  18. 18. Tip #4: Consider Load Weight per Lane Your Challenge: Shipping heavy items that weigh-out before the truck cubes- out Carrier equipment weight varies, especially when using a refrigeration unit Solution: Display current Average Load Weight as Lane Information Collect carrier’s Load Weight in your CombineNet eRFPCopyright © 2013. CombineNet, Inc.
  19. 19. Load Weight per Lane in the RFP Lane information and bid collection in CombineNet Transform carrier capacity to account for higher or lower weights Avg Load Carrier Load Carrier Transformed Weight Weight Capacity Capacity 46,000 46,000 50 50 46,000 45,000 50 48.9 46,000 47,000 50 51.1Copyright © 2013. CombineNet, Inc.
  20. 20. Tip #5: Ensure Carrier Capacity Your Challenge: Carriers quote across the network, not knowing what might be awarded Carriers have capacity limits that cannot be expressed lane-by- lane Solution: Collect lane level capacity, including seasonality limits Collect summary capacity to model overarching limitsCopyright © 2013. CombineNet, Inc.
  21. 21. Modeling One Level of Carrier Capacity Lane-level Capacity Origin Origin Dest City Dest Annual Capacity City State State Volume Atlanta GA Wichita KS 156 150 Total: 446 Atlanta GA Overland Park KS 175 296 Atlanta GA Norfolk VA 468 400 Total: 1,244 Atlanta GA Richmond VA 451 844 Carriers have capacity limitations for each lane – Wichita Volume: 156 loads – Carrier Capacity: 150 loads But by only considering lane-level capacity, buyers cannot determine realistic limits for carrier awards across the networkCopyright © 2013. CombineNet, Inc.
  22. 22. You can Ensure Carrier Capacity! Using Multiple Levels of Carrier Capacity ensures that Carriers can handle all of the awarded loads Origin to Destination State Capacity Capacity Bid by the Carrier Confirming Capacity at Overall Capacity across the Network Multiple LevelsCopyright © 2013. CombineNet, Inc.
  23. 23. Solutions for Food & Beverage Manufacturers Copyright © 2013. CombineNet, Inc.
  24. 24. CombineNet’s Strategic Sourcing Solution for Food & Beverage Manufacturers Advanced E-Sourcing Technology + Content & Services You Need to Achieve World-Class Success! CombineNet ASAP® – Our industry- Food & Bev Best Practices Center –access to leading best-in-class e-sourcing platform a wide range of best practices solutions, for creating and managing online RFIs, content and services tailored to the Food & RFPs, and e-auction events. Key features Beverage Manufacturing industry, including: include: • E-Sourcing Template Library • RFxpress • Premium E-Sourcing Knowledge Content • Expressive Bidding® • Premium Training • Expressive Feedback • Event Start-Up Service • Scenario BuilderSM • Unlimited RFP Readiness Reviews • Bid Analysis and Optimization • Event Coaching Services • Reporting and Dashboards • 15% Discount on Other ServicesCopyright © 2013. CombineNet, Inc.
  25. 25. Case Study: European Truckload World’s 2nd Largest Brewing Company - Consolidated European Freight Key Facts Using CombineNet ASAP enabled 2,500 lanes. 8% + savings. consolidation across all regions, Mostly Full Truckload Retained 80% of creating a better overall picture of (FTL) incumbent carriers what was available for suppliers/carriers: Inbound/Outbound Single sourcing – Encouraged carriers to pick and between breweries, event for all of choose which transportation lanes warehouses, customers Europe to bid on – Enabled carriers to leverage their “With more data under one tender event, there was the assets to best meet SABMiller’s need to support the process with a strong e-sourcing needs with Packaged Bids and solution. We chose CombineNet based on its intuitive Conditional Offers handling of large data sets, the flexibility in defining tender variables, and the strong analytical engine to Using CombineNet’s Expressive assess and visualize different implementation Feedback provided carriers with scenarios.” guidance on their competitiveness Flavio Gall, Global Category Director for Freight and Fleet, Trinity during bidding ProcurementCopyright © 2013. CombineNet, Inc.
  26. 26. Case Study: Ocean Transportation Event Metrics – # of Lanes: 800 – # of Carriers: 45 – Spend Size: $15M Key Benefits: – Able to conduct a Global event while ensuring regional requirements and preferences Temperature controlled containers for 20% of lanes Bids collected were based on a lane-defined container type Some regions required All-in Rate, others required separate Fuel Surcharge – Carrier total-value evaluated through Non-price data Carrier preferred Origin and Destination ports Number of transshipments Total transit time Annual Capacity commitments Result: Regional preferences achieved 18% savingsCopyright © 2013. CombineNet, Inc.
  27. 27. What Next? Learn more about CombineNet’s solution for Food & Beverage companies – Download our Strategic Sourcing Information Kit Found under the Resources tab on the Webinar consoleCopyright © 2013. CombineNet, Inc.
  28. 28. Thank You.Questions & Discussion Phone: 412-471-8200 Copyright © 2013. CombineNet, Inc.