This document discusses collaborative transportation and its benefits. It notes that technological advances have enabled new forms of collaboration without boundaries. Benefits of collaboration include cost savings, improved asset utilization, better service levels and visibility. However, challenges include issues of trust, system integration and data quality. Examples are given of consumer goods manufacturers and tire companies collaborating on distribution to achieve efficiencies and reduce environmental impact.

1. 17 June 2015
COLLABORATIVE
TRANSPORTATION:
IMPROVING COMPETITIVENESS

2. Confidential | © 2015 Chainalytics LLC
WHO IS CHAINALYTICS?
2
%
66WORLD
POPULATION
REPRESENTED BY
SPOKEN LANGUAGES
EXPERIENCE
17SUPPLY
CHAIN
average
YEARS
AMSTERDAM
ATLANTA
BANGALORE
MILAN
MINNEAPOLIS
HELSINKI
SINGAPORE
STOCKHOLM
SYDNEY
9offices
GLOBAL
18TOP 25
supply chains
of Gartner’s
11YEARS
GREAT SUPPLY
CHAIN PARTNERSupplyChainBrain
25BILLION
$
FMIC
FREIGHT SPEND
CAPTURED IN
COOLVENDORin supply chain services
Gartner2013
10 PROS
Supply & Demand Chain
Executive
TO KNOW
8 RETAILTOP 10
7 FOOD & BEVERAGETOP 10
6 CPGTOP 10
91 of the
FORTUNE 500

3. Confidential | © 2015 Chainalytics LLC
– THOMAS FRIEDMAN
Several technological and political forces have
converged, and that has produced a global,
web-enabled playing field that allows for
multiple forms of collaboration without regard to
geography or distance – or soon, even language.
3

4. Confidential | © 2015 Chainalytics LLC
WHAT’S IN THE FUTURE?
4

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WHAT’S IN THE FUTURE?
.
22
Homeplus
virtual
stores in
South Korea
#1
Top online
retailer in the
country
900
Mobile app
downloads
in less than
one year
THOUSAND
130
Increase in
online sales
PERCENT
5

6. Confidential | © 2015 Chainalytics LLC
COLLABORATIVE
TRANSPORTATION
DEFINED
Mutually beneficial cooperative problem solving and
opportunity exploitation – beyond traditional,
predefined trading partners, to foster new, different
and innovative ways to solve business problems and
capture new business.
Source: Gartner 6

7. Confidential | © 2015 Chainalytics LLC
WHY COLLABORATE?
ENHANCE
CORPORATE
RESPONSIBILITY
7
GENERATE
COST SAVINGS
IMPROVE
SERVICE
INCREASE
FLEXIBILITY
BETTER
INVENTORY
MANAGEMENT
REDUCE
MOTORWAY
CONGESTION
LOWER CARBON
EMISSIONS

8. Confidential | © 2015 Chainalytics LLC
CONSOLIDATED
LOADS
CONSOLIDATED
LOADS TO STORE
HIGH-VELOCITY
ITEMS GO DSD
WHAT IS AT STAKE?
8
MANUFACTURER WAREHOUSE RETAIL DC

9. Confidential | © 2015 Chainalytics LLC
BENEFITS OF
COLLABORATION
Making it happen is the
challenge
3PLs will adopt a new
role as warehousing and
freight matchmakers
CARRIER
BUYER
3PL
SUPPLIER
9

10. Confidential | © 2015 Chainalytics LLC
BENEFITS OF
COLLABORATION
10
3% to 20%+ reduction
Empty backhaul reduction 3% to 16%; 25% improved
private fleet utilization
98%+ on-time performance
Increased “perfect orders” (i.e., complete order, correct
items, damage free, delivered on-time, and billed correctly)
50% inventory reduction; working capital freed up for
business growth
100% visibility by SKU from load tender to delivery
Reduce
transportation costs
Increase asset
utilisation
Improve
service levels
Improve
visibility
Improve customer
satisfaction
Increase ability
to grow business

11. Confidential | © 2015 Chainalytics LLC
TECHNOLOGY-DRIVEN
TRANSPORTATION TRENDS
11
Retail outlets serving as eCommerce fulfilment centres with
customer pickup options
Buyers have a range of shopping and delivery options
Omni-channel distribution

12. Confidential | © 2015 Chainalytics LLC
TECHNOLOGY-DRIVEN
TRANSPORTATION TRENDS
12
Driving major changes in retail shopping
Primary means of internet access around the world is through
mobile devices
e.g., Amazon, Walmart
Smartphones, eCommerce and mass
fulfilment centres

13. Confidential | © 2015 Chainalytics LLC
TECHNOLOGY-DRIVEN
TRANSPORTATION TRENDS
13
Omni channel marketing, same day deliveries creating
opportunities for asset-light transport companies
Last mile deliveries

14. Confidential | © 2015 Chainalytics LLC
TECHNOLOGY-DRIVEN
TRANSPORTATION TRENDS
14
Results in smaller products, manufactured and distributed closer
to the end consumer
Improved packaging, better cube utilisation and fewer trucks
Digitization, miniaturization and packaging
improvements

15. Confidential | © 2015 Chainalytics LLC
TECHNOLOGY-DRIVEN
TRANSPORTATION TRENDS
15
Enables shippers to manage their freight much more effectively
Data quality is key to cost saving opportunities, maximising cubic
capacity and of optimising modes and carriers
Transportation management systems

16. Confidential | © 2015 Chainalytics LLC
ENABLING TECHNOLOGY
Cloud computing applications and platforms are improving supply chain
performance
Hosted SaaS
Shipper Shipper/Customer Shipper
TMS
v1.0
TMS
v4.15
TMS
v2.0
Shipper Carrier Shipper
TMS
Shipper Shipper/Customer Shipper
Shipper Carrier Shipper
Increased supply chain
visibility
Improved inventory
tracking
Real-time supply
collaboration
Better transportation
management strategies

17. Confidential | © 2015 Chainalytics LLC
CHALLENGES & OBSTACLES OF
COLLABORATION
SYSTEM
INTERFACES
TRUST
COST & PROFIT
ALLOCATION
SYSTEM
INTEGRATION
DATA
QUALITY
CONFIDENTIALITY

18. Confidential | © 2015 Chainalytics LLC
COLLABORATION
SUCCESS STORIES
All parties must benefit for
true collaboration to exist

19. Confidential | © 2015 Chainalytics LLC
To reduce costs and
provide more frequent
replenishment to
retailers without adding
transportation costs
Built shared distribution
facility; invested jointly in
layer picking automation
for DC; and coordinated
customer orders
Decreased inventory
levels by 30%
Reduced out-of-stocks
by 30%
Lowered DC handling
costs by 16%
TWO CONSUMER GOODS
MANUFACTURERS
19
OBJECTIVE SOLUTION RESULTS

20. Confidential | © 2015 Chainalytics LLC
OBJECTIVE
To address decreased
volumes and increased
delivery constraints
caused by market trends
and regulatory actions
SOLUTION RESULTS
Shared transportation;
eliminated empty trucks
movements; and
collaborated with
customers on pallet
collections, deliveries,
and return flows
Improved transportation
efficiency for all parties
including reduced carbon
emissions and lower
transportation costs
MANY CONSUMER GOODS
MANUFACTURERS
20

21. Confidential | © 2015 Chainalytics LLC
OBJECTIVE
To enable both
companies to service
their customers in a
more efficient and
sustainable way
SOLUTION RESULTS
Collaborated on
outbound deliveries via
3PL
Managed outbound
distribution operations
jointly with single RDC
Removed almost 600
trucks from the road
Reduced carbon
emissions by 6.5MM
pounds in first two years
TWO EUROPEAN TYRE
MANUFACTURERS
21

22. Confidential | © 2015 Chainalytics LLC
– CHARLES DARWIN
In the long history of mankind...those who
have learned to collaborate and improvise
most effectively have prevailed.
22

23. Confidential | © 2015 Chainalytics LLC 23
?
@CHAIN_APAC
bit.ly/ChainLI Richard Koch
rkoch@chainalytics.com
+65 9062 5318
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