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Collaborative Freight Optimization: What You Need to Know

Today's shippers are done talking about collaborative freight solutions and are ready to allocate resources to design and implement programs that can scale, says Ben Cubitt, senior vice president for consulting and engineering of Transplace. He describes the role that 3PLs can play in such projects.

Collaborative Freight Optimization: What You Need to Know

Cubitt says a real shift has occurred in the way shippers think about collaborative transportation opportunities. "The difference is that shippers today are focusing on implementation," he says. "They don't want to do more analysis, they want to implement."

Shippers also are looking for broader opportunities than the lane matching or backhaul programs that have typified collaborative efforts in the past. "They are looking for strategic opportunities in the network and they are devoting resources and taking the time to design and implement programs and work with partners to really drive strategic change," says Cubitt.

It is not unusual for shippers today to want a pilot lane up and running in 90 days with ramp up to other lanes 60 days after that, Cubitt says. One area getting a lot of focus is heavy/light co-loading, where shippers of heavy freight find a partner with lightweight freight to use the additional cube in a trailer, he says. One example of this is Dal-Tile Corporation. "We load Dal-Tile on the floor of a railcar or trailer, which uses about 80 percent of the allowable weight, then we put refrigerators, washers, dryers or ladders on top of that, which makes a perfect load with the maximum weight and cube," Cubitt says.

A similar type of project involves consumer packaged goods companies who co-load freight at DC cluster areas like Atlanta, Chicago or Dallas and ship to clusters of retailers. "Where a CPG company might be shipping every 10 to 18 days to a retailer now, it can co-load and ship more frequently," says Cubitt. "We have a number of such initiatives with companies like Clorox, Del Monte, Colgate and Diamond Foods that have been running for a long time and are in expansion phases."

Collaborative benchmarking is another collaborative area that is getting a lot of attention, Cubitt says. He notes that Transplace just issued its third annual accessorial benchmarking study, which covers fuel surcharges, stop charges, detention charges and the like. "We looked at more than 150 companies with $17bn in spend and we can show shippers what fees are market competitive, what other shippers are doing in these areas and what are the emerging trends," he says.

Transplace also conducts collaborative benchmarking in transportation management, he says. "We can show shippers where they stand on operational KPIs, like tender acceptances from carriers, on-time pickup and delivery, asset broker mix," he says. "Shippers see value looking not just at what they are doing but at how their performance compares to peers inside and outside of their industry."

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Keywords: Supply chain, value chain, 3pl, transportation management, third party logistics, logistics management, logistics & supply chain, logistics services, supply chain solutions, logistics it solutions, supply chain planning, supply chain systems, transportation management systems, supply chain services, retail supply chain

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