Return on Logistics Webinar
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Slides for Return on Logistics webinar. How you can transform your logistics into a competitive advantage.
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Return on Logistics Webinar
- 1. How to Make Logistics Your Competitive Advantage By: Michael Rogers
- 2. BIOGRAPHY MICHAEL ROGERS Since Jimmy Carter was in office I’ve been in shipping. (Don’t remind me of the math.) Back then there were just 200 freight brokers. Today, there are 12,000+ You and I know that just buying a computer and an internet connection doesn’t make one an expert. With my help, my clients have weathered the gas lines of 1979, trucking deregulation that started in 1980, the dotcom debacle, and the $147/barrel oil spike of 2008. While these stats may help you win a round of Jeopardy, it won’t help you with your business. As a 38+ year veteran of the freight business, I’ve seen how most small to mid-size companies are underserved by the carrier and logistics community. That’s why I wrote Return on Logistics, to share the same strategies that large companies use to take their logistics to a strategic level.
- 3. WHAT’S MORE IMPORTANT THAN LOGISTICS? Webinar: Return on Logistics 3 Logistics costs equal 11% of revenue for SMB companies on average. Logistics failures put pressure on manufacturing and create bad customer experiences.
- 4. WHAT’S MORE IMPORTANT THAN LOGISTICS? Webinar: Return on Logistics 4 The push to improve a company’s logistics execution has to come from the top the down. Many of your competitors already know the importance of logistics – and the biggest have it mastered What does a lower logistics spend, more satisfied customers, and fewer disruptions mean to your company and bottom line?
- 5. WHAT’S LACKING FROM YOUR CURRENT LOGISTICS OPERATION? Webinar: Return on Logistics 5 Logistics decision making is decentralized with no accountability - carriers are being used without regard for rates or service A logistics team resistant to change, working with new carriers, or looking for ways to operate more efficiently Issues and disruptions dealt with reactively, no proactive strategy to deal with the rapidly changing trends in transportation procurement No strategy for transportation spend management, or ability to do basic cost analysis or vendor performance management No visibility to enable opportunities for load consolidation or bigger picture network optimization
- 6. FEATURES Webinar: Return on Logistics 6 * July 2015 – 3PL Perspective from Inbound Logistics
- 7. WHAT’S GOING ON IN THE MARKET THAT YOU NEED TO KNOW? Webinar: Return on Logistics 7 Experience – A shortage of qualified logistics talent is available, many logistics ‘pros’ are simply transferred shipping personnel and not formally trained in logistics Capacity – Truckload and LTL capacity is tight due to the recession, regulatory restrictions, Hours or Service, and CAARB Economy – As it improves, capacity further tightens and rates rise Competition – Ecommerce and technology are making the world a smaller place, bringing in more competition to local markets
- 8. WHAT DO SUCCESSFUL COMPANIES GET RIGHT? Webinar: Return on Logistics 8 Find ways to implement technology Focus on developing their logistics staff Don’t view logistics as a cost center Leverage their transportation spend
- 9. SO WHAT TO DO? Webinar: Return on Logistics 9 Incur costs to improve your in-house logistics team and operations Outsource to a 3PL The main options for creating a best in class logistics operation are:
- 10. WHY OUTSOURCE? Webinar: Return on Logistics 10 Cost Savings Increased Logistics Capabilities The benefits extend to many parts of your business: More Flexibility Improves SOPs and Employee Productivity
- 11. WORKING WITH A 3PL Webinar: Return on Logistics 11 * 2015 State of Logistics Report - CSCMP
- 12. BENEFITS OF OUTSOURCING Webinar: Return on Logistics 12 Business Process Improvements Additional Logistics Expertise Cost savings can be realized in multiple ways: Lower Freight Rates Updated Resources and Capabilities
- 13. BENEFITS OF OUTSOURCING Webinar: Return on Logistics 13 Carrier performance management, KPIs Carrier liability Vendor management is improved through better: Control of Inbound Freight Costs
- 14. TECHNOLOGY CAN BE USED TO IMPROVE Webinar: Return on Logistics 14 Rate Management Routing Optimization Invoice Audit Shipment Visibility Regulatory Management of Carriers Routing Guide
- 15. RESISTANCE AND COMMON OBJECTIONS Webinar: Return on Logistics 15 “It’s better to deal directly with carriers.” “I already have the best rates with my carriers.” “It costs more to outsource. By not using a 3PL I cut out the middle-man.”
- 16. COMMON MISTAKES WHEN OUTSOURCING Webinar: Return on Logistics 16 Failure to establish KPIs in advance with a clear understanding of expected outcomes Poor alignment of goals and expectations, because they are not clearly defined and discussed Not really knowing who you are dealing with Picking the cheapest option, without finding the best overall fit Not having an exit strategy (in case things go wrong)
- 17. FINDING THE RIGHT PARTNER Webinar: Return on Logistics 17 According to Gartner’s Magic Quadrant for 3PLs in North America:
- 18. FINDING THE RIGHT PARTNER Webinar: Return on Logistics 18 Research their capabilities Establish expected outcomes Collaboration is the key to ensure a successful partnership: Create a process for measuring results
- 19. WHAT DOES OUTSOURCING TO A 3PL LOOK LIKE? Webinar: Return on Logistics 19 Handle all the logistics functions non-core to your business, allowing you to focus more resources on manufacturing, marketing, and improving customer service Act as an extension of your management team, providing expertise and both hard and soft cost savings Provide processes, technology, and buying power that will make you more competitive in the market place, especially with bigger competitors Help develop new markets, such as international markets and strategic planning of new product launches Here’s what a 3PL partner can do for you:
- 20. Would a no obligation, 2nd opinion of your current logistics strategy be of value?
- 21. NEXT STEP www.4way.com (800) 282 4990 mike@4way.com Would You Like A No Cost, No Obligation 30 Minute Strategy Call To Discuss Your Current Logistics Issues? (925) 263 3190 Direct Line
Editor's Notes
- The goal of the slide is to set the stage on the importance of logistics relative to all the other things CEOs and Sr. Management need to worry about. Of course, they know logistics “happens” but are they really thinking about how important it is? The answer is not much. Logistics costs are important, making up an average of 11% of revenue for manufacturers and retailers. But logistics is more than just freight rates. Inbound logistics has a direct impact on manufacturing performance – late shipments of raw materials and components delay production and put pressure on downstream events. Outbound logistics touches the customer directly and shapes their perception of your products and service more than anything else. The risk of failure is bigger shippers spending $200k to $2M a year on transportation – we’ll explain why during the rest of this discussion. The good news is we will also talk about solutions.
- The purpose of the slide is: 1 - To get the audience to picture the tangible value of better logistics – in hard savings, better customer satisfaction, and more efficient operations. 2 – Convince them taking action is something they need to do to keep up with their competition – the ‘bus is leaving the station’ so to speak. 3 - Reinforce idea that ownership over making logistics work better must come from Sr. leadership.
- The purpose of the slide is to highlight potential problems within their own logistics operations that their company is not managing well enough – or even know they should be managing. The bullets are intended to catch their attention and make them question what is going on and feel they do not have enough control over it. Examples to support this could include: Carriers being awarded loads because they provide pizza or game tickets, and not because they are lowest cost. A company not being able to measure how often the best choice carrier is used. Many logistics operations are little fiefdoms and are often run based on inertia or egos, but seldom in the best interest of the company.
- Supporting data from the July 2015 Inbound Logistics 3PL Perspectives article to touch on high level issues.
- The purpose of the slide is to highlight additional market conditions that exist outside of their company to further create urgency. It is important to note to the audience that all of these issues can be mitigated by a better logistics strategy.
- The purpose of the slide is to highlight – in very simple terms – the exact things they can focus on to start having a positive impact. Whereas on earlier slides we were trying to make things seem overwhelming and complicated, now we want them to feel the solutions are clear attainable, with the right help.
- The goal at this point is to transition this to a discussion of what options a company has to improve their logistics operations and sell the 3PL concept. Option 1 – Do it In-house. You can speak briefly to the pros and cons to this approach, mostly focusing on the difficulty and expense of going this route. I am intentionally not using up any slide space on these concepts. Option 2 – Outsource to a 3PL. The next few slides provide the supporting points.
- A high level review of the benefits of outsourcing, with additional points to support the benefits on the following 3 slides.
- Discuss a few of the interesting data points on the slide relative to users experience and trends for companies working with 3PLs.
- These are details to support WHY OUTSOURCE slide
- These are details to support WHY OUTSOURCE slide.
- These are details to support WHY OUTSOURCE slide.
- Discuss possible talking points to refute these common objections they’ll hear from employees once they start pushing for change.
- Discuss specific things that companies commonly overlook or do pay enough attention to when setting up a 3PL partnership.
- This matrix explains that 3PL leaders (ie. the best 3PL partners) provide these 4 specific benefits, as framed by Gartners ‘well-know’ Magic Quadrant methodology.
- Discuss steps and concepts for finding the best 3PL partner.
- Discuss the great, new reality for a CEO and their company once they have started working with a 3PL.
- Inspire action and get them to take the next step. Or, at least show them where to find more information.