SHIPPING COST REDUCTION & OPTIMIZATION

In the quest to squeeze time and cost
out of the supply chain,
transportation logistics need to be assessed every year.

There's gold there.

Information on NPI's shipping cost reduction, shipping audit services

NPI helps clients achieve continuous improvement in supply chain transportation efficiency day-to-day, and year after year; reducing costs while maintaining or improving customer service.

We provide oversight for billions of dollars in supply chain transportation spend, and each client has unique shipping cost reduction opportunities. Following are some of the most common NPI advisory services that produce savings and increase efficiency:

    • Mode Optimization Studies: NPI assesses options for transporting goods from Point A to Point B – small parcel, Less-than-Truckload (LTL), truckload (TL) and domestic and international air freight – in the context of a client’s specific capacity, demand, price and service requirements; including unique business needs such as pharmaceutical, medical services and cold chain. If clients use multiple carriers for a mode, we validate whether perceived differences in carrier performance are true (we find them to be inaccurate more than 50% of the time).
    • Zone Skipping Impact Analysis: For clients that do a lot of long-zone small parcel shipping, it can be less expensive to build FTL or LTL loads. NPI can model relevant scenarios and provide objective analysis that help clients select the ideal approach for their business.
    • Fuel-Surcharge Impact Analysis and Management: Fuel surcharges are a wildcard. Especially in today’s economy, they are a volatile element of transportation spend. In addition to helping clients predict their impact, NPI can help clients improve the fuel surcharge terms of carrier agreements to mitigate that impact.
    • Time-in-Transit Analysis: For some clients, longer time-in-transit is a non-issue and can reduce costs. Others become more competitive by reducing time-in-transit, leading to increased revenue. It pays to periodically revisit this key performance measure, which is closely related to Small Parcel Service-Selection Optimization.
    • Small Parcel Service-Selection Optimization: In a surprising number of cases, NPI’s models identify unnecessary use of expedited services when standard services would yield identical delivery results – and big savings. NPI helps clients determine whether the right services levels are being selected at all distribution points (front office, warehouse, etc.), implement trade-downs wherever possible and measure sustained savings.
    • Returns Program Optimization: Returns programs can be a real differentiator – especially for industries such as retail, parts supply, distribution and fulfillment. NPI can help you reduce the transportation cost of returns and capitalize on potential competitive advantage opportunities.
    • Inbound Cost Optimization Analysis: For some clients, it makes sense to switch from inbound Freight Prepaid-and-Add to Freight Collect. NPI gives them facts to help make that decision.
    • Packaging Tuning: Packaging changes are not trivial for clients or for their suppliers from an operations perspective, but sometimes a simple packaging change can have too big an impact to ignore – especially with today’s DIM factor penalties. NPI analysts are always inspecting client data for packaging-driven expense that may signal important cost reduction opportunities.
    • Post M&A Transportation and Distribution Integration: NPI helps clients quantify and plan for the transportation cost impact of mergers and acquisitions; and then get carrier relationships integrated in accordance with the plan.
  • Cold Chain Transportation Optimization: The food, pharmaceutical and chemical industries have special requirements for cold chain transportation. NPI assesses clients’ networks for savings opportunities in this costly special-handling facet of supply chain transportation.

As we work with our clients over time, NPI discovers other pockets of savings – for example, unnecessary or excessive insurance; service charges for unused parcel carrier accounts; and ideal situations for smart pick-ups to cut weekly service charges.

NPI is also a resource for ad hoc reports that provide business insight to help them make better logistics decisions and promote shipping cost reduction – clients ask us for information such as shipment distribution by zone for the marketing team; year-over-year trends for managers; and correlation of shipments to specific products or business units for marketing or accounting purposes.

Customer testimonial for NPI's shipping cost reduction and shipping audit services

 

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