How to Manage Global Transportation Spend with a System that Increases Agility, Control, and Ability to Measure Performance

1. © GT Nexus, Inc.
A STRATEGIC IMPERATIVE FOR RETAILERS
Reduce Freight Spend
How to Manage Global Transportation Spend with a System that
Increases Agility, Control, and Ability to Measure Performance

2. The Challenge
Today, it’s diffi cult to decide on the best allocation of freight
funds. It’s also a challenge to manage data from each partner
once they have been chosen. With so many carriers and
logistics providers involved in a global supply chain, retail-ers
struggle to form a single, high-defi nition view of rates
and other transportation data. They must attempt to gather
information from each partner’s proprietary system or ERP
software.
Traditional transportation management systems are not up to
the task of managing freight spend in global supply chains.
They come with a high cost of ownership and long implemen-tation
times, with persistent visibility gaps along the way. In
an increasingly complex global trade environment, retailers are
having trouble lowering transportation costs while still provid-ing
quality service.
Plant
Impact of Poor Freight Management
Without a system to bring transportation spending and
management to a single control layer, retailers have limited
ability to make sure the money they spend is going to the
right carriers and partners. They also have little insight into
how contracted rates and estimated costs compare to the real
thing. They experience:
High costs due to expedited air freight
Money wasted due to limited agility
Poor ability to rate carriers and measure compliance
Inability to measure KPIs — actual vs. plan
The Root of the Problem
Transportation providers charge varied rates in varied sce-narios,
managing their operations on proprietary systems. This,
coupled with the need for many modes of transportation in
regions worldwide, makes it hard for retailers to optimize their
spending.
1. Rapidly changing global transportation market
Today, a major challenge in managing freight spend is deal-ing
with changes in the market. When capacities, fuel costs,
and new processes quickly shift, costs must be allocated to
refl ect new carrier abilities. These rapid changes cause:
Increasing number of small shipments with tight delivery
timelines
Disparity between processes of different carriers; some
manual processes, some in-house software, some ERP
2. Growing number of carriers and service providers in a
single supply chain
As supply chains grow, so does the number of parties
involved in shipping a product from one place to another.
Each participant has its own way of operating, and each
stores data in its own system. This causes:
Higher chance of miscommunication
Greater landed cost accrual
More data needed to compare rates and choose the best
allocation
© GT Nexus, Inc.
2
Retailers must keep transportation costs as low as possible without sacrifi cing service
levels.
With a complex transportation plan, retailers need a way to see data from all
of the parties involved.
Plant
Network
Connectivity
Agility
Customers
Customer
DC / Warehouse
Plan
Actual At-Risk Delay
Dynamic ETA
B
A
Sense more accurately
Operate more efficiently
Respond faster
Make better decisions

3. Plant
Plant
Network
Connectivity
Agility
When information on rates and
service is isolated into separate
silos, there’s no clear picture of
where the money is going.
Customers
Customer
DC / Warehouse
Plan
Actual At-Risk Delay
Dynamic ETA
B
A
Sense more accurately
Operate more efficiently
Respond faster
Make better decisions
3
The Solution
Retailers can reduce freight spend by adopting a system that
provides both a platform and functional modules to gain agility,
control, and the ability to measure performance. This solution
provides a control layer that connects to all of the separate TMS
systems a retailer might be using with their logistics providers,
bringing the isolated data into a single system. They can use
this data to compare rates and monitor performance, adjusting
freight spend accordingly and lowering costs.
TMS Control Layer
Extended Enterprise Visibility and Control Infrastructure
Supply Enterprise Demand
TMS-3 TMS-4 TMS-1 TMS-2 TMS-5
Deploy a global transportation management system
that brings all data to a central location.
Integrated transportation sourcing, planning, execution and
FP&A
Control layer that includes native capabilities of sourcing,
rating, planning, tendering and freight payment and audit
Rapid implementation and fl exible confi guration
Series of performance analytics to measure compliance
to plan
How to use it to reduce freight spend:
1. Reduce freight costs through improved sourcing and execu-tion
process
2. Identify “at risk” orders and minimize modal/service shifts
3. Use milestones to measure performance on specifi ed busi-ness
rules
4. Run unlimited what-if scenarios to optimize spend
Value Propositions
By handling transportation in
the cloud, retailers can manage
freight rates and spend on a
single platform. Benefi ts include:
1. Reduce transportation costs
Lower rates through improved sourcing
Reduce cost with optimal mode and carrier selection
Eliminate overpayment via pre-audit of freight bills
2. Set consistent processes for all partners
Eliminate inconsistencies by 3PLs
Measure and report across all providers
3. Gain deployment fl exibility
Roll out functionality as desired, by business unit or
region or both
4. Collaborate for more effective planning
Prioritize or postpone shipments based on demand
Use multi-vendor/multi-port consolidation
Increase equipment use
Reduced Freight Spend and the Networked
Company
To reduce and optimize freight spend, companies must
transform themselves from silo-based, inward-facing corporate
operators to interconnected, highly agile business network
orchestrators.
In the cloud, all transportation data is brought to a single control layer.