Logistics Topics: Software, Fulfillment, and Social Media

We need more supply chain experts on executive boards

2011-10-20T10:25:00.000-04:00

Tim Cook, Apple’s new CEO, was originally hired by Steve Jobs back in in 1998 as the Senior Vice President for Worldwide Operations before he was promoted to COO in 2007. His experience in manufacturing, logistics and the supply chain prior and during his tenure at Apple has helped make Apple’s supply chain one of the industry’s best and a large part in the technology company’s meteoric rise.

Should more technology companies follow suit and place supply chain expertise on the executive board? Michael Koploy, ERP Analyst at SCM Software Advice argues that the current state of the global economy and the importance of supply chains to successful tech companies means more executive positions should be filled with supply chain graduates.

Unfortunately, a supply chain talent crisis is holding back the industry from being able to place more graduates on the executive board. Ken Cottrill discusses the lack of high-level supply chain talent in his whitepaper Are You Prepared for the Supply Chain Talent Crisis? If and when talent catches up, Koploy believes that individuals with the following characteristics will be the most capable of C-level ascension:

Global supply chain management experience
Experience managing a team that adheres to just-in-time, lean and Kanban fundamentals
Supply chain management (SCM) software experience using solutions equipped with business intelligence (BI) and forecasting/planning functionality
Ability to organize and execute both operational and strategic supply chain initiatives and improvements.

More more on the topic, check out Koploy’s blog post on the topic at: Consumer-Driven Technology Creates the Need for a C-Level Supply Chain Focus.

Selecting Shopping Cart Software

2011-10-02T15:35:00.001-04:00

Shopping Cart Software

The shopping cart software, or ecommerce platform you select for your online store is a lot more than just a way to enable customers to pay for orders on your website. The right software will provide tools and support to not only sell more products but operate many other parts of your online retail business more efficiently.

If you are looking evaluate options for selecting a shopping cart program click here.

The following is a list of ways a comprehensive shopping cart software/ ecommerce platform helps an online retail store.

Payment Processing – payment support for credit card processing, PayPal or other methods of processing payments
Webpage Design – including step by step wizards and store front design templates to get your store setup plus most will also integrate into the backend of your existing website
Inventory Control – processes to keep track of your inventory, set up low inventory alerts and generate reports
Shipping – tools that calculates shipping costs for orders with integration to small package carriers like FedEx, UPS, and the USPS
Tax Calculation – help to calculate sales taxes, which is complicated to handle on your own
Customer Management – reporting and purchase history for customers
Marketing – integrated information on affiliate programs, search engine optimization, social network marketing, site analytics, and conversion optimization
Security – protection of confidential information for your customers
System Integration – connection to the software with your ecommerce order fulfillment provider

Plus a few more ideas....

Administration and Inventory Control – Functionality to support business needs from Account and Inventory to Mobile Applications
Marketing – Support with social media connectivity, cross-selling and up-selling at checkout
Support – Features like SSL secure checkouts, fraud protection, backup, restoration, and cookies
SEO – Control over title tags and descriptions to help maximize the store for search engine optimization
PCI Compliant Hosting – A Payment Card Industry compliant hosting environment
Up-Selling and Cross-Selling Features – Offering customers products of a greater value that what they are considering plus offering complimentary products
Product Reviews – Enabling customers to post reviews of products on the site
Price Management – Flexible options for pricing enabling promotional or other pricing options
Catalog Management – Simple, set up and addition of products on store including images
Site Analytics – Monitoring of site activity and user tracking for optimization
Product Feed Support – Able to create a feed of your products to shopping comparison sites

Help for online retailers to understand what to look for when outsourcing order fulfillment

2011-09-01T16:16:00.000-04:00

If you are an online retailer and are finding it difficult to keep up with your pick pack operation and shipping customer orders, it may be time to think about finding a third party order fulfillment center. Similar to other difficult business decisions a growing company has to make, it is important to understand all the costs associated with outsourcing your fulfillment and shipping operation to an outside company.

The following is a breakdown of the general areas of cost a typical business will face when bringing on an order fulfillment service resource. Each company's needs and situation are different, but understanding these costs is vital to making the best business decision possible to position your company for maximum future growth.

Storage (a.k.a. "rent" for your products): Fulfillment centers will charge storage for the space an online retailer’s products take up in the warehouse. This is generally done on a per square foot or per pallet basis.

Inventory Inspection and Receipt: Since most online retailers are having their suppliers ship the products directly to an order fulfillment warehouse, the online retailer is not able to inspect the shipments to make sure the products are the correct quantity and in good condition. A fulfillment center becomes that extra check to make sure the supplier is sending the right products and will report any discrepancies to the client.

Order Charges: Packing orders is the main part of the whole order fulfillment service, although not necessarily the largest cost. These are the labor costs for preparing and boxing up orders. The rates are generally based on a flat per order fee, plus a cost for each additional item included in the order. The more orders a retailer ships with a fulfillment company the lower the per order cost will be for the most part. The order cost is intended to cover the systems and time to receive the order, prep the pick ticket and other paperwork, as well as the time to physically build the carton, locate and pick the items on the order.

Material Costs: Simply stated, material costs include the cost of cartons and packing materials. Most fulfillment centers are buying boxes in bulk so this is one area a 3rd party fulfillment center can help reduce costs.

Shipping Costs: These costs will make up the majority of the expense of getting products to customers. Here's a link to reference useful information on calculating costs for shipping small packages. Many fulfillment operations will allow their customers to ship on their account numbers with FedEx and UPS, thus providing better shipping rates than most customers could negotiate on their own.

Returns: As some products are inevitably returned from a retailer’s customers, the fulfillment center can help inspect items and report to the retailer details on the returns.

Initial Move: There is often an initial inventory move of products from the online retailer to the fulfillment warehouse. This means there are potential costs for the shipping and receipt of the products as they are brought into the fulfillment center.

System Integration: The process for integrating an online retailer’s ecommerce shopping cart software may require some customized programming expense. How orders get communicated to the fulfillment warehouse can happen in a variety of ways (EDI, API, Email, or even fax).

Some fulfillment centers will offer bundled pricing that includes a certain amount of storage space and a certain number of orders shipped in a period of time. Or, the fulfillment charges may be calculated as a percentage of sales. There is nothing wrong with either method of pricing, just be certain the rates accurately reflect your true activity levels.

One-Time Charges	Possible Units of Measure
Account Set Up	one time charge

Software Integration	one time charge

Monthly Charges	Possible Units of Measure
Monthly Software Charge	fixed charge per month

Account Management	fixed charge per month

Activity Based Charges	Possible Units of Measure
Order Processing	per box charge
	per order charge
	addt'l charge per piece

Packing Materials	per carton
	per envelope
	box assembly charge

Receiving	per piece
	per SKU
	per carton
	per pallet
	per hour

Storage	per cubic foot
	per shelf
	per pallet

Shipping	per order handling fee
	surcharge to use your own account

SKU Fee	per SKU

Returns	per order
	per hour

Paperwork Preperation Charge	per Interntional Order
	per Freight Order (LTL shipment)

Pallet Preparation Charge	per pallet

Rush Order Surcharge	per order

Kitting/ Assembly	per item
	per hour
	per order

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Kenneth Kowal ecommerce order fulfillment for online retailers.

Good Videos for Online Retailers from IRCE 2011

2011-08-28T10:13:00.001-04:00

http://images.internetretailer.com/IR/IRCE-2011_E-Commerce-Tech-Theater-Details.html#agilone?cid=IRT

Check out the last video from UPS for Shipping Information.
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For Online Retailers looking to outsource order fulfillment.

Strategies for Online Retailers to Deal with Free Shipping

2011-06-22T09:36:00.000-04:00

There are a number of good strategies to deal with the free shipping war going on right now in the online retail space. The bad news is there is no FedEx "Free" option that companies like Amazon know about, while you are stuck shipping FedEx Ground. The key is to manage your shipping costs while also packaging those costs in the right way to your customers so they can see the holistic value of your products and not make purchasing decisions based on just on the perception that the shipping is free.

- Free Shipping for a minimum purchase or on certain products: A key to being able to offer low cost or free shipping is to have enough margin built into your product to cover those costs. Knowing your margins and shipping costs can help you develop the right model to know the points in which your margins can support covering shipping costs.

- Flat Rate Shipping Options: For many online retailers, the shipping costs for their customer orders will be very different order to order. This is the result of weight, size, and destination being different depending on the product mix. With some analysis from your order fulfillment operation you can determine your average shipping costs and charge based on the average. Displaying shipping costs earlier in the check out process reduces cart abandonment and a flat rate shipping cost can make this easier.

- Shipping Clubs and Optional Upgrades: Many online retailers offer a service that for a one time fee you can receive free or upgraded service - see Amazon Prime or Shoprunner. Or consider on top of a flat rate price, the option to upgrade from Ground to Second Day Air for a small up charge.

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Twitter: @kennethkowal

Good Articles on Returns at an Order Fulfillment Warehouse

2011-05-25T10:12:00.001-04:00

http://www.practicalecommerce.com/articles/2793-Using-the-Return-Policy-to-Convert-Shoppers-into-Customers

Also, here is a link to another post that talks about how a 3rd party order fulfillment operation handles returns.

http://fillship.com/blog/2011/05/17/how-are-returns-handled-at-an-order-fulfillment-warehouse/

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What to talk about order fulfillment for your company? Click Here!

Half of all online orders shipped for "Free"

2011-05-21T15:47:00.000-04:00

Interesting information from comScore via TechCrunch.

http://techcrunch.com/2011/05/17/almost-half-of-all-online-orders-now-include-free-shipping/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29

How Do Online Retailers Offer "Free Shipping?"

2011-05-20T15:45:00.000-04:00

A question we get a lot from clients is "How can so many online retailers offer free shipping?", which is then followed up with "What can we do to compete with free shipping offers?"

There are a couple of reasons online retailers are able to offer free or cheap shipping, unfortunately the reality is that there are no free shipping service options with Fed Ex or UPS or the Post Office or anyone else. So whether you are a large shipper, ecommerce startup, or growing online retailer there is no such thing as free shipping.

What large companies do get, that startups and small companies typically do not, are substantial discounts on small package company's published rates. In addition, if a company is shipping a very large amount of the same size packages there is often the chance to get preferential rates in those circumstances.

Clearly if you are a startup or small online retailer you are at a significant disadvantage because you are without the leverage to negotiate better rates with FedEx or UPS. But in the end, just like your business, the big online retailers are covering the cost of shipping with the margins in their products.

What to do about it as a startup or small online retailer? Obviously it is paramount to figure out ways to minimize shipping expenses because these are costs that are not going away no matter how big you get.

Consider alternatives to FedEx or UPS by looking at the options offered by the USPS. Many companies find that Flat Rate Priority Mail boxes are a good way to reduce costs. FedEx and UPS charge hefty residential, extended delivery area and fuel surcharges that hurt the economics of shipping Business to Consumer (B2C) with them.

More distance equals more cost so your shipping location is directly correlated to your shipping costs. Most of the people in the US are located in the mid-atlantic and northeast part of the country. If you are shipping from San Francisco to customers in New York, the cost could be double or more than the cost to ship to New York from a location in Pennsylvania. Another advantage the big guys have is the ability (as in volume) to ship from multiple points within the US. They can service most of the country with cheaper ZONE 2 or 3 shipments, as opposed to expensive ZONE 8 shipments going coast to coast by having multiple warehouse locations to ship from. Similar story, but it does take volume to make it worthwhile to set up multiple shipping points around the country.

Many 3rd party order fulfillment warehouses will pass on their volume discounts with FedEx and UPS, so look into a partnership to outsource your product shipping. Your operation will potentially benefit from the collective volume of all the customers shipping from that fulfillment center.

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Ken Kowal is the Director of New Business Development for 3rd party fulfillment warehouse Landis Logistics and ecommerce order fulfillment service FillShip.com. Follow Landis on Twitter @landislogistics. If you would like to talk about way we can help save your online retail business on shipping costs get in touch at kkowal@landislogistics.com.

Want free industry advice from "experts" on shipping and fulfillment?

2011-05-13T12:18:00.000-04:00

Two websites you may want to check out if you have questions on shipping and fulfillment are Quora and Focus. Both give you the chance to post questions and get answers from industry "experts" that will hopefully be helpful. Here is a link to an example of a question from Quora.

http://www.quora.com/Whats-the-cheapest-shipping-method-for-businesses-shipping-high-volumes-of-small-boxes-within-the-U-S-where-the-box-weighs-more-than-13-ounces?__snids__=18166978#ans388442

Or, feel free to contact me at kenneth.kowal@yahoo.com to talk about order fulfillment and logistics. Visit kennethkowal.com.

New Resource to Help Online Retailers with Order Fulfillment and Shipping Questions

2011-05-11T15:12:00.000-04:00

Have, or looking to start, an online retail store? Check out www.shipstarter.com - they will offer some free advice to help you navigate the complicated process of getting your customer orders packed and shipped.

Thinking of using offsite storage services?

2011-05-09T12:09:00.002-04:00

If you are a manufacturer, or any business that has a need to warehouse and storage products then you may have considered outsourcing as an alternative to keeping the product in your own building. So, what are the costs that go into using a 3rd party warehouse for this service that you should be aware of.

Storage Costs (of course), which are typically charged by the month and on a per pallet or square foot basis.

In/ Out Charges are the handling charges for physically unloading the product off the trucks and putting them away in the warehouse, and then loading them on trucks again when they leave the facility.

Paperwork Fees are the cost for preparing shipping paperwork like the Bill of Lading Form.

Pallet Preparation Fees can include the cost of adding shrink wrap, re-palletizing boxes, or other labor costs involved in getting pallets ready to ship out of the warehouse.

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Ken Kowal is Director of New Business Development for Landis Logistics and FillShip.com, serving online retailers and manufacturers with order fulfillment and warehousing services in the PA, NJ, and NY area.

Do you ship a LARGE amount of a SMALL number of products?

2011-05-05T11:38:00.000-04:00

A great way to drive efficiencies within an order fulfillment operation is to, of course, be more efficient with the packing process.

One great opportunity to do that is if you have a certain number of unique sku's that typically ship alone, and at a high volume. Instead of waiting for each customer order to come in for a product that will likely be shipping by itself, utilize some down time to pre-package the products in its shipping container so that when the customer orders do come in it is simply a matter of printing and applying the shipping label to the package.

Reasons to Consider Flat Rate Shipping from the USPS

2011-05-03T11:28:00.000-04:00

Here is an interesting article from the Practical Ecommerce website (click here).

This is a question that comes up a lot when I am talking to online retailers. I would add to the points in the article that regular priority mail can also be less expensive than the flat rate option so don't just assume flat rate is always the best option.

It should also be noted that being able to track packages is a concern for online retailers as the Post Office service does not provide as the same level of tracking capabilities as FedEx and UPS offer.

Many third party order fulfillment services will offers a greater discount off of UPS/ FedEx shipping rates so if you are working with a 3rd party, the tipping point at which the USPS is a more expensive option often happens at a lower threshold than what the analysis illustrates.

Outsourced Order Fulfillment: What to do about the cartons?

2011-05-03T11:23:00.000-04:00

Some of the questions we often receive when talking to prospective clients who are considering outsourcing their order fulfillment are in regards to the shipping cartons used to package customer orders. As in, does the online retailer supply their own boxes or do we as the 3rd party fulfillment provide the cartons.

The answer is actually that it can work either way. Most fulfillment centers will stock a variety of sizes to accommodate a range of product sizes. Because these specific sizes are being bought in bulk for several customers by the order fulfillment warehouse, they are typically available to the clients at a lower cost than if the client were to purchase the cartons themselves. If a client requires a "non-standard" size that the order fulfillment center does not stock, they'll often buy them on behalf of the client and mark them up slightly to cover administrative/ carrying costs (10-20% is not unusual).

If a client wants to supply their own cartons, or use free cartons, provided by a carrier (like USPS, FedEx, UPS) then the fulfillment center may charge an assembly fee ($.20 +/- per carton) to cover labor and dunnage costs to build the box and prepare it for shipping.

If you are shipping a food product then packaging become a bit more complicated and insulted cartons will easily run 3 to 4 times the cost of plain corrugate.

Social Media and the Supply Chain

2011-05-02T10:23:00.002-04:00

Social media is proving to be more than just a hip fad. It's a medium that will change marketing and business at an alarming rate over the next few years. Here are some statistics from a recent article on just how big social media is becoming:

Facebook has over 500 users. These users spend over 700 billion minutes every month on the website
200 million Twitter users send out about 95 million tweets every day.
Over 100 million users have created a LinkedIn account, with over 1 million users signing up each week.

Businesses are now learning to use social media to increase their brand presence, connect with their customers, and learn how to improve their offerings and operating efficiencies. How can logistics and supply chain operations use social media to ensure their operations are lean and their productivity is maximized?
This topic is discussed in a new article on WMSG by guest blogger Luciano Cunha. Cunha discusses how social media can be used to maximize supply chain demand planning, but under the caveat that context must be considered to ensure that data is accurate and useful. He discusses two paradoxes (the Real-Time Paradox and the China Paradox) that exemplify this need to consider the audience when using social media data. In the article, he also provides guidance and suggestions on how to effectively use social media and the Connected Experience for better logistics management.
You can read the article in its entirety here: http://www.warehousemanagementsystemsguide.com/blog/social-media-supply-chain-042711/.

Online Retailers: Not Sure How Much to Charge for Shipping?

2011-04-13T15:09:00.002-04:00

One thing online retailers find challenging when operating an online store is deciding how, and how much to charge for shipping. Obviously covering the cost of shipping and handling is a must, but the latest trend for many retailers is to offer reduced or free shipping. It has gotten to the point that many consumers are starting to expect free shipping, even at the expense of paying more for the product (the cost has to go somewhere!). Being smart and efficient in how a company pays for the costs of order fulfillment and shipping is paramount as these costs often make up the largest % of a company's operating budget.

I recently came across this article that nicely summarize the shipping costs and policies of many of the top retailers out there. It's a good read if you are looking to create your own shipping rates for the products you sell.

Click for an articles on Important Questions to Ask a Potential Order Fulfillment Company & Order Fulfillment Services.

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Ken Kowal is an expert in order fulfillment for online retailers. Check out more about order fulfillment on Twitter (@kennethkowal).

How Are Returns Handled at an Order Fulfillment Warehouse?

2011-04-08T10:48:00.002-04:00

A frequent question we receive when talking to prospective order fulfillment online retail clients is in regards to the returns process. How does it work - Can you handle returns - Can you inspect the product - How do you report the returns - Etc?

In most cases, the answer is that a typical fulfillment service can handle returns however you, as a customer need them to. For our clients, the returns process most often will include the following steps:

- the returned product is delivered back to our fulfillment warehouse

- it is checked in and referenced by its original sales order

- the order and product information is recorded and emailed back to the online retailer

- based on the customer's direction, the product is inspected and returned to inventory to be sent out again

- or, for some clients all returns are set aside and the client periodically comes on site to inspect the items

- or, some clients have all items (most often food fulfillment products) disposed of, or returned to the manufacturer

The returns process of course starts with the communication to the customer on how to go about returning the products they need to. This is often done with step by step instructions that may be listed on the packing list, or the website. A returns label may accompany the orders as well. FedEx and UPS offer simply ways to have a pre-paid shipping label sent with the order to facilitate the return.

When it comes to inspecting the returns, setting up specific guidelines regarding what to look for is key. Many products are commonly returned into inventory but many require a much closer examination. Setting clear expectations and procedures at the outset is very important to make sure the process runs smoothly.

The cost for managing returns is really dictated by the requirements so there is no "list" price for returns in most cases. Once the fulfillment center has a track record of the types of returns and the amount of work that goes in to inspecting the returns they can often put together a "per return" cost. Prior to that, most fulfillment centers will charge based on their warehouse hourly rate.

Ken Kowal is the Director of New Business Development at Landis Logistics, a pick and pack order fulfillment warehouse located in eastern PA, and serving clients in NY, NJ, and nationally.

Social Media and StartUp for Order Fulfillment

Receiving Product at a 3rd Party Order Fulfillment Warehouse

2011-04-04T09:41:00.001-04:00

When a company has outsourced its storage and order fulfillment warehouse operations to a 3rd party distribution center, the receiving process takes on added importance. This is because the company is relying on that warehouse to be their last check to make sure the products they have ordered are getting delivered in good shape and in the correct quantity.

Aside from simply storing and reporting on inventory levels of products being keep on site, a warehouse is the inspection and counting inbound product. Since the customer is not able to do it themselves, the 3rd party warehouse has to play that role – and do it right.

One important step to ensure the Receiving process runs efficiently and accurately is for inbound shipments follow any procedure the warehouse may have in place for an ASN (Advanced Shipping Notification). The ASN is a heads up to the warehouse that product is coming in and helps the facility be prepared to inbound the material.

This also speeds up the time it takes for the product to be entered into inventory, and of course be available for filling future orders.

The following are general steps in the Receiving Process:

Before signing the Bill of Lading:

Check for visual damages to cartons and product

Count verification against the Bill of Lading

Once the product is unloaded from the carrier:

Verification of product id’s/ SKU’s and quantities against the ASN

Further visual inspection for damages

Lot/ Serialization number recording into WMS

Product put-away

Getting the receiving process done right is the first key step to maintaining an accurate inventory within a warehouse or order fulfillment facility. Visiting logistics social media and networking sites focused on the supply chain (such as http://www.cha1n.com/, http://www.blogsinlogistics.com/, and http://www.logipi.com/) is a good way to learn about best practices for receiving.

Order Flow Process: Pick and Pack Fulfillement

2011-04-03T08:56:00.001-04:00

Order Process Flow for Pick and Pack Fullfillment @ Landis Logistics

Leveraging Technology for Your Order Fulfillment Operation

2011-03-30T08:55:00.000-04:00

Technology is the cornerstone of a well-running order fulfillment operation, whether it’s helping to manage orders, control inventory and warehouse operations, manage freight, or support real-time reporting requirements. It’s through technology that guess-work is eliminated from the order fulfillment pick and pack process, human error is reduced, and products and content go to market faster and at lower cost.

When it comes to fulfillment-related technology and systems, there are no absolute solutions. One size does not fit all or even most companies. Moreover, implementing a technology infrastructure to support your fulfillment operations is not only about hardware and software systems. Savvy companies and marketers use technology as an enabler to gain process efficiencies, access mission-critical information, and run their businesses better.

Here’s a quick litmus test. Take a quick look at your existing order fulfillment services operations: is the technology you rely on flexible, giving you room to grow and adapt to change? Does it support the flow of information seamlessly through the entire order fulfillment process - from order entry through to shipment? Can you access data and generate reports in real time to support critical decision-making? Are you making technology investments in the processes that need them most? Whether you are utilizing the expertise of a third party fulfillment provider or managing your logistics and operations internally, all of these are important considerations whether you are a startup order fulfillment operation or large multi-location operation.

As you assess your technology strategy to support new business initiatives or enhance your existing infrastructure, here are some insights that will put you on the right path:

Start With Strong People

The foundation of a strong fulfillment infrastructure is having expert, knowledgeable information technology (IT) professionals supporting your program - either in-house or through your outsourced fulfillment partner. IT professionals who understand technology and are experienced in the business side of fulfillment can provide your company with important, big-picture expertise. Additionally, in the outsourcing model, if your fulfillment provider does not offer value-added technology related services as a core competency (i.e., e-commerce site development) they should have partnerships in place to provide the support you need in a seamless manner.

Ensure Flexibility on the Front End

A flexible fulfillment technology infrastructure starts on the front end with the intake of order data. Your fulfillment partner should have the capability in their order management system to accept orders from various ordering mechanisms: e-commerce, call center, electronic data interchange, file transfer protocol (flat file, text file, XML, etc), and others. Order management systems built on flexible technologies such as enterprise resource planning (ERP) can be easily adapted to support your changing requirements.

Keep Data Flowing Through the System

Customer order information should move seamlessly from the front end to the warehouse/inventory management platform and ultimately through to final shipping. By automating the flow of information through the fulfillment environment, technology can facilitate faster, high quality order processing and shipment. Moreover, your fulfillment provider should offer you the ability to view critical customer order data at all points in the process. Real time data access will help you make more informed decisions related to production requirements, inventory levels, and customer buying patterns, while providing visibility into areas where costs could be reduced.

Use Technology to Improve Process Control and Fulfillment Accuracy

In the picking and packing of orders, technology can be an important enabler to further speed up the order fulfillment process and maximize quality. Technologies such as radio frequency identification (RFID) and bar coding can facilitate “system directed picking” helping the fulfillment provider’s employees to pick and pack high volume, complex orders where there is little margin for error.

Invest in the Processes that Need it Most

Simply put, some fulfillment processes don’t require technologies like RFID or bar coding to get the job done. The critical determining factors are speed and quality. For example, some fulfillment programs, like literature distribution, are less technology-dependent. Here, a manually driven pick and pack process can still meet time to market goals.

Lower Costs in Transportation Management

In the transportation management area, technology can be a further enabler to reduce the costs of your fulfillment program. Leveraging rate shopping programs, your order fulfillment pick and pack partner can work to compare carriers and select the most effective options for each shipment. This can help reduce overall freights costs while continuing to ensure prompt customer delivery.

Maintaining Your Lifeline to the Customer

Since information is the lifeblood of your decision making process, you need data on all facets of your fulfillment program. including inventory, orders and more and you need it in a real time manner. Leveraging technology, your partner should offer you the capability to extract data from the fulfillment infrastructure and generate real time reports in the format you require. Access should be easy and at your convenience online 24 hours a day giving you an instant, on-demand snapshot of your critical business activity.
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Ken Kowal is Director of Sales and Marketing for Landis Logistics, which specializes in ecommerce order fulfillment for startup and online retailers.

Order Fulfillment Services Outsourcing: Why it’s Right for Your Business

2011-03-30T08:52:00.001-04:00

Justifying the outsourcing decision: 10 reasons to take to your management team

1. Access Best-in-Class Capabilities
Third party order fulfillment service companies provide you access to expertise that is typically not readily available internally.
2. Enhance Core Business Focus
Outsourcing Pick and Pack lets you spend more time marketing and growing your business and enhancing your products and services. Supply chain operations are taken off your plate and put in the hands of a proven expert.
3. Achieve Operational Excellence
Your fulfillment partner will seamlessly add operational expertise to your organization, enhancing your overall efficiency.
4. Enhance Customer Satisfaction
Fulfillment is a critical connection to the marketplace and your customers. A smooth running supply chain will improve your reputation for quality and reliability, while building long term customer loyalty.
5. Preserve Capital
Why invest in warehouse space, technology, and additional operations staff if you don’t have to. Outsourcing lets you redirect your capital to growing your business.
6. Reduce Operating Costs
Outsourcing helps lower or eliminate costs that would be necessary to manage an internal fulfillment program: staff, training, facilities, freight, and on-going administration. Further, fulfillment outsourcers have the resources and relationships to achieve critical economies in areas such as freight consolidation and pass on the savings to their customers.
7. Speed Time to Market
Outsourcers are equipped to get your products into the hands of your customer quicker and cheaper. This is particularly for those order fulfillment companies who are strategically located near the highly populated Eastern United States.
8. Leverage Technology
Leading fulfillment companies understand the critical role of technology in the order fulfillment process and have invested in systems and infrastructure to support their service delivery. Through outsourcing, your business gains access to the benefits of this technology without having to make the investment yourself.
9. Support Multiple Channels
Many ecommerce order fulfillment providers have diverse services to support product distribution across multiple channels’ B2B, B2C, Direct-to-Store shipments, and more.
10. Adapt to Change
Similarly, as market forces and buyer behavior drives changes in your product lines and service offerings, your outsourcer is well positioned to grow right with you, leveraging its investment in people, facilities, and technology.
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Kenneth Kowal is Director of New Business Development at Landis Logistics and can be found talking about ecommerce order fulfillment for startups on LinkedIn and Twitter.

Selling online and thinking of outsourcing your shipping and order fulfillment?

2011-03-30T08:49:00.001-04:00

If you have an online store and are finding it tough to keep up with packing and shipping your customer orders, it may be time to think about working with a 3rd party order fulfillment center. But like all the other difficult business decisions a growing company has to make, it is important to understand all the costs associated with outsourcing your shipping operation to an outside company. The following is a breakdown of the general areas of cost a typical business will face when bringing on an order fulfillment service resource. Each company's needs and situation are different, but understanding these costs is vital to making the best business decision possible to position your company for maximum future growth.

Storage Costs: Fulfillment centers will charge storage or "rent" for the space a retailer’s products take up in the warehouse. This is generally done on a per square foot basis or by the pallet.

Inventory Inspection and Receipt: Since most online retailers are having their suppliers ship the products directly to an order fulfillment warehouse, the online retailer is not able to inspect the shipments to make sure the products are the correct quantity and in good condition. A fulfillment center becomes that extra check to make sure the supplier is sending the right products and will report any discrepancies to the client.

Order Charges: Packing orders is the main part of the whole order fulfillment service, although not necessarily the largest cost. These are the labor costs for preparing and boxing up orders. The rates are generally based on a flat per order fee, plus a cost for each additional item included in the order. The more orders a retailer ships with a fulfillment company the lower the per order cost will be for the most part. The order cost is intended to cover the systems and time to receive the order, prep the pick ticket and other paperwork, as well as the time to physically build the carton, locate and pick the items on the order.

Material Costs: Simply stated, material costs include the cost of cartons and packing materials. Most fulfillment centers are buying boxes in bulk so this is one area a 3rd party fulfillment center can help reduce costs.

Shipping Costs: These costs will make up the majority of the expense of getting products to customers. Here's a link to reference useful information on calculating costs for shipping small packages. Many fulfillment operations will allow their customers to ship on their account numbers with FedEx and UPS, thus providing better shipping rates than most customers could negotiate on their own.

Returns: As some products are inevitably returned from a retailer’s customers, the fulfillment center can help inspect items and report to the retailer details on the returns.

Initial Move: There is often an initial inventory move of products from the online retailer to the fulfillment warehouse. This means there are potential costs for the shipping and receipt of the products as they are brought into the fulfillment center.

System Integration: The process for integrating an online retailer’s ecommerce shopping cart software may require some customized programming expense. How orders get communicated to the fulfillment warehouse can happen in a variety of ways (EDI, API, Email, or even fax).

Some fulfillment centers will offer bundled pricing that includes a certain amount of storage space and a certain number of orders shipped in a period of time. Or, the fulfillment charges may be calculated as a percentage of sales. There is nothing wrong with either method of pricing, just be certain the rates accurately reflect your true activity levels.

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Kenneth Kowal ecommerce order fulfillment.

Ecommerce Order Fulfillment Services for Startups and Online Retailers

2011-03-14T22:00:00.001-04:00

Whether you are a startup looking to launch a new website, or a small online retailer just starting to grow, ShipStarter has the expertise to drive results with the most cost-effective product fulfillment services. We understand the unique challenges you face to ensure products get to your end-customer on time and at the lowest cost, and we work to deliver fast, accurate and money-saving services through strategic logistics solutions.

We have complete turnkey capabilities for an array of startup and small online retailer’s order fulfillment needs, including:

• Straightforward Shopping Cart Integration
• Ecommerce Order Fulfillment Service for Startups Packaging and Shipping
• Small Parcel Shipping Expertise and Volume Discounts
• Direct-to-Consumer and Business-to-Business Order Fulfillment Services
• Expertise in a Range of Consumer Products including; Nurtriceuticals, Cosmeceuticals, and Food Fulfillment
• Logistics for New Product Line Introductions: from supplier to final delivery

When you partner with ShipStarter, you gain a team dedicated to helping you drive growth for your ecommerce startup or online retailing endeavors, providing full logistics solutions that positively impact your bottom line.

Order Fulfillment Service in the New York and New Jersey Area

2011-03-14T21:54:00.001-04:00

Are you looking for warehousing and fulfillment services in the New York or New Jersey area? Make sure you evaluate Landis Logistics as a cost effective partner. Located only 2 hours drive from New York City in eastern PA, Landis provides order fulfillment service to many NY and NJ based retail and manufacturing businesses. Many of whom find the lower storage and labor costs can reduce their warehousing and fulfillment cost by 30% to 50% or more. Whether you are an online retailing looking to outsource product fulfillment, a startup looking to launch a new website, or large manufacturer needing outside warehousing, Landis has the expertise to drive results with the most cost-effective product fulfillment solutions. We understand the unique challenges you face to ensure products get to your end-customer on time and at the lowest cost, and we work to deliver fast, accurate and money-saving services through strategic logistics solutions.

We have complete turnkey capabilities for an array of retailer and manufacturer’s order fulfillment needs, including:

• Location in eastern Pennsylvania (Reading), about an hour NW of Philadelphia

• Lower Storage and Labor Costs Compared to the NY Metro Area

• Lower Overall Shipping Costs Across the US

• Client list which include several Fortune 100 companies, as well as smaller sized ecommerce online retailers and startups

• Ecommerce Order Fulfillment Best Practices for Packaging and Shipping

• FDA Approved – Warehousing and Food Fulfillment Operation

• Small Parcel Shipping Expertise and Volume Discounts

• Next Day Guaranteed Ground Delivery to New York City Metro Area With FedEx

• Direct-to-Consumer and Business-to-Business Order Fulfillment

• Logistics for New Product Line Introductions: from supplier to final delivery

When you partner with Landis, you gain a team dedicated to helping you drive growth for your ecommerce startup or online retailing endeavors, providing full logistics solutions that positively impact your bottom line.

6 Sites to Bookmark: Shipping Information for Online Retailers

2011-03-06T14:47:00.000-05:00

Here are links for comparing rates from the 3 main options for shipping small packages:

FedEx:
https://www.fedex.com/ratefinder/home?cc=US&language=en&locId=express

UPS:
https://wwwapps.ups.com/ctc/request?loc=en_US&WT.svl=PNRO_L1

US Postal Service:
http://postcalc.usps.gov/

Carton and Packing Material Costs:
A quick and easy method for getting costs for a variety of packing materials: http://www.uline.com/. If you plan to buy in bulk (>100 units) it may be worth talking to a local supplier for better rates.

Shipping something larger than 100 or so lbs.? Check out http://www.freightquote.com/ to get a shipping rate and http://www.eroutingguide.com/ to help with the shipping paperwork.

ShipStart: Ecommerce Order Fulfillment for Start Ups

2011-02-13T09:12:00.001-05:00

FillShip is proud to annouce it has been brought into the Landis Logistics family and will now operate as a division of Landis.

FillShip will continue to provide turnkey ecommerce order fulfillment services for small and medium size online retailers, including consumer goods and food products.

Landis Logistics provides pick pack services for medium and large manufacturers and ecommerce companies.
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DIM charges - Big Changes with FedEx and UPS

2011-02-05T15:12:00.001-05:00

If you ship with FedEx or UPS, there was a big with rates you should be aware of – and this is not just the usual annual rate increase.

The DIM factor FedEx and UPS use is changing, from 194 to 166 for U.S. Domestic air and ground packages (applies to ground packages 3 cubic feet or larger) and from 166 to 139 for many international services.

THIS IS A SIGNIFIGANT INCREASE THAT WILL AFFECT MANY SHIPPERS.

The concept of Dimensional Weight is widely used as a uniform way to establish a minimum charge for the cubic space a package occupies.

Dimensional weight, also called “DIM” weight, is used because the space a package takes up on a delivery vehicle may cost more than the shipping charges for the package’s actual weight. You should calculate dimensional weight for every shipment, compare that to its actual weight, and use the greater of the two to determine your shipping cost. Using the carrier’s free packaging is one way to make sure DIM charges are kept in check.

For domestic air services, the package’s billable weight is either the actual or dimensional weight of the package—whichever is greater. For ground packages, the greater of actual or dimensional weight applies to packages measuring 5,184 cubic inches (three cubic feet) or greater.

If you ship larger packages, near the DIM threshold it is likely your overall shipping costs will increase. The amount of the cost increase will depend on the number and weight of your shipments.

Here’s a note we received from a local “small package expert” that explains the change in more detail.

The DIM calculation did change this year.

It went from 194 down to 166.

Here is how it works… Express packages are always affected by Dimensions. If the size (dimensions) are greater than actual weight you will be affected by DIM and will be charged the higher of the 2 rates, actual vs. DIMed rate.

Ground shipments are only affected by DIM if they are over 3 cubic feet in size or 5,184 cu inches. Then the same thing happens, you are charged the higher of the 2 rates.

Here’s the calculation:

Length x Height x width = x

Then take x and divide by the DIM divisor of 166 = equals the DIM weight

If the Dim weight is higher than the actual you get rated on the higher of the 2 rates.

Here’s an example: 15lb actual weight, zone 4 shipment with measurements of 25x22x20

If billed at 15lb rate is $8.52list rates

When you factor the dims, it comes out to 11,000/166 = 67lbs and the rate is $23.36

With the old 194 factor it would have been lighter therefore cheaper at 57lbs for $21.22

The DIM change really affects you if you have lightweight large items… plastic parts, lightweight parts with a lot of overpackaging…etc

What to do about it? Talk to you local Fed Ex or UPS sales reps – they may be willing to discuss developing a customized DIM calculation formula that may ease the pain of the change.

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Provider of ecommerce order fulfillment and pick pack distribution services for startups.

Quick Primer: What is SEO and Why It Matters to Logistics Companies

2010-12-10T14:35:00.008-05:00

Frankly stated, SEO, or Search Engine Optimization is the process of getting your companies website found when people search for certain terms on Google (or any other search engine like Bing or Yahoo).

As an example, if you are a third party logistics company that specializes in frozen food service distribution, then you want your name to appear in Google's Search Engine Results Page (SERP) when customers are looking for the type of services your company offers. SEO is the process of creating and positioning your site to rank well on Google's search pages - organically. If someone goes to Google and searches on "frozen food logistics" you want to be the first company that potential customer sees on the page.

You will notice there are other listings at the very top and right margin of the Google results pages. Those are ads that company's pay for to be located in those areas. Each time someone clicks on one of those links it is costing the company $.50 to several dollars for the privilege of a user clicking on their link. Organic search like we are talking about here is the process of getting your site to rank high on the page without paying any of Google's pay per click fees.

So what is Google looking for to rank your company highly as a logistics software company, or as an ecommerce order fulfillment provider? There are two main things: relevant content on the site related to the search terms and site credibility, which means there are other sites with "backlinks" to your site. Backlinks are a type of "social proof" that other website are linking to your website because it is credible and worthy.

So what to do? Figure out what "keywords" your customers are typing into Google that relate to what services you are selling and add related content to your site in the form of blog posts or new pages that will show Google you have authority on those topics. Then, work to get backlinks to your website from other credible websites. This can be done by responding to blog and forum posts and getting your website address out there. Both these strategies are complimented by a well executed social media strategy.

These two ideas are just barely scratching the surface of ways to improve SEO for your site. The benefits of ranking well with Google are almost priceless, yet easy to achieve when executed properly.

Cost Components of Order Fulfillment

2010-12-02T19:38:00.002-05:00

One of the largest expenses for any business that sells products online is the cost for order fulfillment. In total, the order fulfillment process includes the storage, packing, and shipment of customer orders that come through an online store. These costs are beyond the expense of sourcing and purchasing the products being sold (regardless of what the business might be selling) plus all the marketing and other various cost of sales type expenses. Taken all together, this long list of different cost items have to be managed effectively for a business to maintain an acceptable profit margin. It goes without saying, a positive profit margin is vital to the viability and success of an ecommerce retailer. Fortunately, making the right decisions regarding the storing, packaging, and shipping costs are likely the easiest on the list to impact for the better.

Below is a list of the three primary cost considerations for ecommerce retailers when it comes to packing and shipping customer orders.

Packing Supplies. These costs include the dunnage (or packing material) to fill in and around to protect the product, as well as the cost for the cardboard carton the goods are placed into. Basic shipping supplies and cartons from UPS, FedEx, and USPS are free, as is the logistics software they will provide - so that is one thing to take advantage of when you can. Of course shipping a lot of empty space in a bad fitting carton is a poor choice for a number of reasons. Your business may also prefer to brand packaging with a company logo and not a big UPS label! The additional cost of customized packaging has to be considered.
Direct Shipment Costs. The choice of who ships the order (whether it is USPS, UPS, Fed Ex) and at what service level (Ground, Next Day Air, etc.) impact costs often more than any other single item. Shipping Ground Service instead of Next Day Air can often save over 2/3 off the shipping cost. Of course it can also add 4 or more days on to the delivery time. Volume means a lot when it comes to shipping with FedEx and UPS, so make sure your contract stipulates that discounts on shipping will kick in once you hit certain volume thresholds. There is a "hybrid" option in which a shipping company (such as FedEx or DHL Globalmail, or various others) acts as a mail integration partner. These companies will pick the packages up on their own trucks but then move the parcels to the USPS who make the final delivery to the consumer. This set up works only in a business to consumer model and generally requires a minimum daily amount of parcels (typically 250 per day).
TIME. Is packing up customer orders in cartons, maintaining space for storage, and printing shipping labels the best use of your time? As a small business owner you should be asking yourself constantly throughout the day - Is what I am doing right now helping to make my business more successful? Managing your social media logistics presence, marketing, or selling are all important priorities. Chances are you could make better use of your time than doing your own order fulfillment.

New LinkedIn Group: Social Media for Logistics

2010-12-02T12:38:00.003-05:00

We have created a new group on LinkedIn called Social Media for Logistics.

The Social Media for Logistics Group is a forum for individuals to share and discuss their experiences with Social Media as it relates to supply chain logistics.

Our goal is to build the group forum into a reference resource with examples and advice on how to use Twitter, LinkedIn, Facebook, blogs, and other social media platforms.

Members include thought leaders from 3rd Party Logistics Companies, Supply Chain Professionals, Carriers, Shippers, Manufacturers, Marketing, Logistics/ Transportation Management Software providers, and Order Fulfillment, as well as Supply Chain Industry Researchers and Publications.

Please visit LinkedIn and join in on the conversation.
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Social Media for Logistics Blog

Logistics and Social Media

2010-11-26T07:30:00.000-05:00

Whether you recognize it or not, your logistics company has, and is a brand and social media is a key marketing platform for growing and protecting that identity.

So what are the various social media platforms available out there? Here is a partial list of the most popular and likely relevant that businesses need to be aware of:

•Twitter: A micro blogging site in which short notes can be broadcast to a list of "followers" in 140 character bites. Twitter is gaining popularity and has over 170 MM registered users. An under-appreciated fact is that Twitter is a great search tool and more effective than Google in a lot of ways.

•Facebook: A social networking site with over 500 MM registered users, Facebook is the largest social media platform on the internet. Facebook users are highly engaged and active so the right presence in that space is a powerful thing.It cannot be avoided anymore - it is vital for every business to understand and actively manage the tremendous upside that social media offers for companies today. As a logistics services provider social media is every bit as crucial to your company as it is for the large international consumer brands we all see in the media every day.

•Blogging: Yes, even you should have a blog... There are countless free services for hosting a blog (Tumblr, Blogger, Wordpress) and blogging gives you the chance to establish credibility in an industry, educate, and communicate with customers.

•LinkedIn: LinkedIn is a business focused social network in the way Facebook is a personal social network. LinkedIn is built to facilitate conversations and networking amongst its users.

You should be asking yourself if there really is any legitimate value to all of this to my organization. As an example, every logistics companyneeds to understand that Twitter is NOT just a way for some celebrity to tell the world what they ate for lunch today. It is a way to connect and interact with their community of fans. Think about what the person is really doing - they are actually furthering their personal brand among their core audience, and if they do it right they are attracting new followers who will get in line when their next movie comes out. These are the results any business that uses Twitter is also looking to achieve in its own way.

The opportunity and the challenge of social media for logistics services providers is to find where your core audience is online. It is certainly not worthwhile to Tweet or spend time creating a Facebook account online if there will be no one there to see it. Using social media is an investment of cost and time - the community and following does not happen quickly but the rewards can be significant if done right. Whether you are a logistics software provider or a truckload carrier, your customers are somewhere in an online community.

The key to building this following is to create interest in your presence through content or services that inspire people to engage. This can be educational content or tools that help people do their jobs better in some way, or it can just be funny or engaging activities that people develop an interest in (see Farmville on Facebook!). Marketing 101 states that engaged customers are loyal customers and getting customers to interact with you because they want to is winning the hardest part of that battle.

Social Media for Logistics Services Companies

2010-11-08T16:09:00.002-05:00

It cannot be denied any longer - it is important for every company to understand and actively manage the role that social media plays for businesses today. As a logistics services company social media is every bit as important to you as it is for the large consumer brands we all read about every day. Recognize it or not, your company is a brand and social media is a vital tool for developing and protecting that brand.

Twitter is NOT just a way for famous people to broadcast what they had for breakfast, it is a way to listen and engage customers. The opportunities in the world of social media for logistics companies are limitless. Using Twitter, Facebook, LinkedIn and some of the other social media services will support your efforts in the areas of sales, customer service, and marketing.

I am barely scratching the surface with this list, but here are some examples of how a logistics company can use social media:

• Read industry blogs (like EasyLogisticsManagement) and search on Twitter for what people in the Supply Chain and Logistics markets are talking about. Watch how people are being creative with their approach to using social media which will help inspire new ideas for yourself.
• Use Twitter and Facebook to engage customers and keep your name in front of them. Answer questions and make suggestions without an in your face sales pitch. Be helpful and the customers will think of you when they need you.
• People “tweet” and use social media outlets when they are not happy with service so if people are talking about your company, you want to know about it and be able to react.
• Participate in Social Networking Sites (like http://www.logipi.com/ or LinkedIn) and Supply Chain Forums to establish yourself as an expert in the space. These sites allow you to showcase yourself as a subject matter expert.

Shipping Something Next Day Air With FedEx Or UPS? READ THIS FIRST!

2010-10-25T21:40:00.002-04:00

If you are looking for a way to save money on shipping small packages here is a tip. FedEx and UPS service many points next day guaranteed with their low cost Ground Service. So, why pay for next day air service on a package you need to be delivered tomorrow at double or triple the cost? For example, from our food fulfillment warehouse in eastern PA, FedEx will service anywhere from New York City down to Washington DC next day with their ground service. There is no need for us to EVER pay for next day air to any of those points. Similarly, FedEx Ground is just a 2 day service to Chicago and most of the Midwest. Again, as a more cost effective option compared to Second Day Air, Ground is a better choice.

Check out the FedEx site to calculate transit time from your location to where your package is going.

To illustrate, startup online ecommerce business and artisanal sausage retailer Sausage Obsession reduced their shipping costs by over 50% when they began shipping products Ground instead of Next Day Air. The handmade sausage products Sausage Obsession sells are all shipped fresh or frozen. Obviously getting the customer orders shipped from their order fulfillment service operation has to be done quickly and reliably. With the same type of packaging and amount of dry ice they were using before, Sausage Obsession is now able to service all their customers half way across the country without paying for expensive Next Day Air delivery.

Ecommerce Order Fulfillment Explained

2010-10-06T17:32:00.002-04:00

What are the different service and cost components of packing and shipping with a 3rd party fulfillment operation?

If you are an online retailer thinking about partnering with a 3rd party ecommerce order fulfillment warehouse to handle your pack and ship operation you should understand the different categories of service a typical fulfillment house will provide.

Receiving and Storing Product: This includes the process of receiving your goods into their warehouse. It begins with a thorough inspection of the product as it arrives to ensure there is no damage and the exact products and quantities match what is expected based on your direction and the Bill of Lading. On an ongoing basis it is important for the provider to maintain and report accurate inventory numbers. Storage requirements depend on the product but can include the facility maintaining a temperature controlled environment, custom racking, or on-shelf storage. Receiving and Storage rates are generally billed as either a per pallet cost, or a per package cost depending on the product.

Order Pick Charges: An integral part of the fulfillment process is how orders get transmitted from you to the facility. This can happen as part of an integration with your shopping cart software, EDI, flat file, or even a fax. As the orders are received, they are assembled or “picked”. Order Pick charges are generally based on a flat per order fee that includes the first item, and then a small additional charge for each additional item in the order. So, as an example, if your typical order is for three items, you could expect to pay $4.50 per order plus an additional $.50 for each additional item, making the total $5.50 to have the order packed.

Administrative Support: Fulfillment providers will often charge a monthly service fee for things like reporting or fielding customer calls. These charges can varying by a large extent and depend on the requirements you put in place.

Packing Materials: This would include the cost of the carton the order is shipped in, any dunnage (packing material to protect the product in the box), as well as the labor to assemble the box. These costs may or may not be included in the Order Charges detailed above. Remember, the majority of costs for a fulfillment operation are labor, so each small action (assembling a box, printing a label, placing an item in a box, etc.) each take time. It may feel like you are being “nickeled and dimed” but it is really about charging for the exact time spent for your specific needs. Fulfillment is not a one size fits all service in any sense.

Shipping Costs: The handling costs associated preparing an order to be shipped (printing the shipping label, palletizing boxes, etc.) are generally covered by the Order Charges. But obviously one big remaining cost is for shipping (FedEx, UPS, USPS, etc. assuming you are shipping boxes, not pallets at a time). If you have one, it is often best to use your company’s own account number and most fulfillment providers will allow you to do that. They may, however have a better contract with one of those carriers and be able to pass on some of that savings.

More info on Ecommerce Order Fulfillment and Frozen Food Fulfillment.

Selling a Food Product Online? Things to consider with your fulfillment operation

2010-10-06T17:28:00.003-04:00

What are the special considerations for an online retailer selling food products online?

The whole order fulfillment process is made up of many steps, but there are two factors that apply to dealing with food products. First, the location you choose to store and pack your shipments needs to be food grade, which means it meets certain standards for cleanliness and pest control. The facility is periodically inspected to make sure those standards are upheld. Second, you need to consider if there are there any requirements related to the temperature in the facility that need to be considered while the products are stored and also when they are shipped.

From a storage and handling perspective, non-frozen or “dry” food products can be handled similar to any non-food product. The main exception is of course that the requirements for maintaining a food grade facility need to be adhered to. Food products, whether dry or not will likely have expiration or best used by dates so it is important to manage the inventory to make sure product is still fresh and usable. The FIFO (first in first out) method of managing inventory generally makes the most sense for food products. Frozen products obviously need more care and temperature control during storage. Keeping frozen food frozen is clearly important, but more subtle requirements such as controlling humidity and ambient temperature are also important.

From a shipping perspective, the needs are very similar. Dry food products can ship similar to most any item, although some non-frozen products may need to avoid being frozen at the risk of damaging the product or its packaging. Shipping frozen products is an additional, but manageable challenge. There are many options for stock, or custom packaging to be used when shipping frozen food (or any cold item for that matter). Kits that contain a styro-foam “cooler” and tight fitting carton are likely the best option and can be designed for most applications. Items packed in the box, along with dry ice can be kept safely frozen for 24 to 48 hours during shipping under normal conditions (think hot summer and cold winter). Needless to say, some level of expedited delivery, preferably overnight needs to be used to make sure product gets delivered on time. However, keep in mind, UPS and FedEx offer Ground service that provides next day delivery to locations within a pretty good size radius. There’s no need to pay for expedited delivery when ground will suffice –the cost savings could be >50%.

Small Parcel Shipping Explained: Comparison of UPS and FedEx Services

2010-09-28T16:28:00.004-04:00

Despite how UPS and FedEx brand their services, they are basically similar. Below is an explanation of how the services correspond between the two providers.

Overnight Services:

FedEx First Overnight = UPS Next Day Air Early AM

FedEx Priority Overnight = UPS Next Day Air

FedEx Standard Overnight = UPS Next Day Air Saver

2-Day Services:

FedEx 2 Day = UPS 2nd Day Air AM & UPS 2nd Day Air

3-Day Services

FedEx Express Saver = UPS 3 Day Select

Ground Services:

FedEx Ground = UPS Ground

FedEx Home Delivery = UPS Ground

FedEx SmartPost = UPS Basic

For more information to help your online retail business work better, visit www.fillship.com.

More information for online retailers: ecommerce order fulfillment

What is the purpose of a Bill of Lading?

2010-09-20T21:21:00.003-04:00

A Bill of Lading is a document issued by a consignor (or shipper, such as an order fulfillment center) and signed by a carrier at the time of pick up, acknowledging that specified products have been received on board as cargo for delivery to a named consignee, or destination. It serves as a contract between the shipper and/ or owners of the goods and the carrier for a number of purposes:

• It is evidence of a valid contract of carriage, and may incorporate the complete terms of the contract between the shipper (such as a startup ecommerce order fulfillment servce) and the carrier which may include payment terms, rates, description of product classification, as well as other duties and obligations.

• It is a receipt signed by the carrier confirming whether goods matching the contract description have been received in good condition (see SLC below). The information could include pallet and/ or piece count, weight, product description and classification.

• Once signed by the consignee, it is a receipt of goods received providing final confirmation of the quantity and condition of the product received. A signature by the consignee is acknowledgement the goods are received as described on the BOL unless discrepancies are otherwise noted at the time the BOL is signed.

• The signed BOL may also often serve as a Proof of Delivery (POD) document as well as back up for the Freight Invoice.

The Bill of Lading will typically at minimum contain the following information: Shipper’s Name and Address, Consignee’s Name and Address, Description of Goods including pieces and weight, NMFC Classification, Bill to Party (or Payment Terms), relevant load ID numbers, and Carrier’s Name.

As a matter of process, the driver from the carrier will sign the BOL at the time of pick up when the goods are loaded onto the carrier’s equipment. At this point the carrier is responsible for inspecting the goods to ensure the quantity and condition of the product is as noted on the BOL. Depending on the shipper’s rules, the BOL can be signed “Shipper Load and Count”, or “SLC”, which means the carrier has not been given the opportunity to inspect the goods prior to loading when it is not practical or permissible. A copy of the signed BOL will often be kept be the consignor.

The original copy of the BOL will physically accompany the shipment from pick up through delivery.

Upon delivery of the shipment to the consignee, the receiving location will inspect the product as it is unloaded – prior to signing the BOL acknowledging receipt. Any damages or shortages will be noted by the consignee on the BOL at that time. Generally speaking, if a consignee notices damages at a later time and nothing was noted on the BOL at the time of delivery the shipper and carrier will not be held accountable for the issues. An executed, final signed copy of the BOL will be retained by the consignee as a receipt of the shipment delivered. The carrier will retain a final copy of the Bill of Lading as well.

Visit http://www.eroutinguide.com/ for a complimentary Bill of Lading generator tool.
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Ken Kowal is Director of New Business Development for order fulfillment service company Landis Logistics.

6 Reasons why a Routing Guide is crucial for effective Transportation Management

2010-08-25T08:22:00.002-04:00

What is a Routing Guide?

A Routing Guide is a document whose purpose is to outline the rules that govern how a company’s shipments should be handled. This could include any shipment ranging from small package, airfreight, import/export, to full truckloads of product. The goal is provide a document with straight forward instructions detailing what carrier and account numbers are to be used for any given shipment when the cost will be paid for by that company.

To illustrate, a Routing Guide would specify the correct way to send a shipment in the following sample situations:

• What company to use for sending office correspondence (Fed Ex or UPS?) and what account number to use: the best answer may be different depending on service required such as over-night or ground.
• The correct Less-than- Truckload carrier to use when a buyer has purchased product from a supplier and the order needs to be delivered to one of your locations: LTL tariffs are complicated and certain carries may be cheaper depending on the origin and destination for a given shipment.

Any time a shipment is being routed on behalf of your company, and the cost is hitting your bottom line, it is important to make sure the correct routing decision gets made. A good Routing Guide ensures that happens.

What happens without an effective Routing Guide?

Having a clear, concise Routing Guide is of particular importance when a company is decentralized geographically, has multiple locations, or a large supplier/ vendor base.
When the correct routing is not followed several negative things can happen.

• Product is routed with the wrong carrier resulting in potentially bad service and higher cost
• Product arrives at the wrong location
• Packaging may be incorrect or sub-standard
• Bill of Lading, filled out incorrectly or shipments will have incomplete documentation , interrupting the receiving process at your facility
• Freight Invoices are incorrectly rated or sent to the wrong address for payment, delaying payment
• Shipping volume will not be recognized when volume discounts are part of a contract

As part of a Routing Guide, specific packaging and paperwork requirements you need suppliers and vendors to be mindful of can be spelled out. For instance – do you need pallets to be stacked less than a certain height to fit in your facility’s racks? Do you require an Advanced Shipping Notification or Purchase Order number noted on the Bill of Lading for the product to be received properly? There are many low cost and free Transportation Software solutions offering tools for helping to create and distribute your Routing Guide.

Routing Guides are intended to be dynamic documents. Make sure you have a process to update and distribute the Routing Guide to your entire vendor base and across internal departments as updates are made. If the updates are not disseminated effectively then the instructions will become quickly outdated and miss-routed and/ or miss-rated shipments will occur.

Not having an up to date Routing Guide creates extra cost and hassles for a company, so make sure your Routing Guide document is current and widely distributed.

Transportation Management Software - Beta Testers Needed! (part #2)

2010-08-24T21:19:00.008-04:00

Not one to let good content go to waste - the following is a portion of the instructions we are working on for the Routing Guide functionality.

Feedback is always appreciated.

We are looking for companies to beta test the new parts of our new transportation management software so get in touch if you are interested.

Thanks.

eRoutingGuide is built to allow flexibility with how you create your company’s Routing Guide. You are able to include as much information as you feel is necessary, and in any format. Remember, the idea is to firmly set the ground rules up front for all vendors, suppliers or anyone shipping product on your company’s behalf – so include any information you feel is important. Think how easy it will be to get your up to date Routing Guide into the people’s hands that need it. You’ll save time, energy and cost when your freight is routed right the first time.

eRoutingGuide allows you to upload an existing .pdf file to your personalized Routing Guide website that can be accessed by whomever you choose. There is also a large free-form area to add text with additional information for users to be aware of. Click Here for an example of a completed profile.

You’ll want to include basic information such as key logistics contacts with Names, Phone Numbers, Company Locations, etc.

Most importantly, make sure you spell out the specific routing instructions for any supplier, vendor or person within your own company shipping to you, or on your company’s behalf. Below are a few ideas to get you started or click here to see a sample eRouting Guide.

- Who are your preferred carriers? As an example, if there is a supplier routing an LTL shipment moving from Georgia to a location in New Jersey – the supplier needs to know the best carrier to use is X, and it needs to be billed to your correct account number which is XXXX.
- Do you have a national account with Fed Ex or UPS? People within your company need to know what account numbers to use to make sure the correct discount is applied.
- Do you utilize a 3rd Party Logistics company to handle all your truckload routing – make sure their contact information is easily accessible.
- Are appointments required at your facilities? Who do they contact for an appointment?
- Do you require an Advanced Shipping Notification (ASN) number? Make sure vendors and suppliers know that is a requirement and the procedures to follow.

All these points should help give you the idea. Once updated, eRoutingGuide allows you to easily send companies a link to your personalized webpage.

Click Here for an example of a completed profile. We welcome your questions and feedback: questions@eroutingguide.com

Thank you for choosing eRoutingGuide. Supply Chain Software made easy.

http://knol.google.com/k/anonymous/transportation-management-software-what/4ilw4vkwik1x/1#

Transportation Management Software - Part # 1 for ShipAssist - Beta Testers Needed

2010-08-23T21:14:00.006-04:00

Not one to let good content go to waste - the following is a portion of the instructions we are working on for the ShipAssist functionality. Routing Guide to follow in part #2.

Feedback is always appreciated.

We are looking for companies to beta test the new parts of our new transportation management software so get in touch if you are interested.

Thanks.

ShipAssist is built to allow flexibility with how your facility’s Shipping Dock information is displayed on your personalized ShipAssist website. You are able to include as much information as you feel is necessary, and in any format. Remember, the idea is to firmly set the ground rules up front for any trucking company coming into your shipping dock – so include any and all information you feel is important. Think of the phone calls and hassles you can avoid by the carriers getting this information in advance!

Click Here for an example of a completed profile.

Here are some recommendations:
You’ll want to include basic information such as Phone, Address, Directions, and Hours.
Most importantly, make sure you include the specific Rules and Regulations at your shipping dock. Here are a few ideas to get you started or click here for an example.
- Are appointments required? Who do they contact for an appointment?
- Upon arrival, drivers must Auto- Check In by texting their load number to xxx-xxxx (*if your facility has eRoutingGuide Auto-Check-In service)
- Is a lumper service required? What is the rate?
- Is a lift-gate required?
- How many hours of wait time should a driver expect before you will approve detention?
- Will a delivery be refused without an Advanced Shipping Notification number?
- Is a pick up or some type of load number required?
- Are drivers allowed on the dock? Are you a shipper load and count (SLC) facility?
- How are OS&D issues handled?

Those points should give you the idea. Once updated, ShipAssist allows you to easily send companies a link to your personalized webpage and require that all carriers and vendors confirm their understanding of the rules and regulations on your ShipAssist website. Your Shipping Department will thank you.

Click Here for an example of a completed profile.

We welcome your questions and feedback: questions@eroutingguide.com

Thank you for choosing ShipAssist. Transportation Management Software can be simple!

New Interview About Transportation Management Software Startup - eRoutingGuide.com

2010-08-16T12:00:00.001-04:00

I had a blast last Friday talking to Justin from http://www.asable.com/ talking about startup Transportation Management Software company, eRoutingGuide and ecommerce order fulfillment company, Fillship.com. Check out the interview on the AsAble.com site.

Also, check out a conversation with Dustin Mattison of Logipi.com.

Ship products? eRoutingGuide is looking for companies to beta test a new product, no cost or obligation

2010-08-16T08:12:00.001-04:00

If you ship anything, you should check out http://www.eroutingguide.com/ - any new user who signs up by 9/1/10 will be given free access to the new ShipAssist and Routing Guide products. All that is asked is feedback on how the system is working and ideas for improvements.

Here is an overview of the system:

Executive Summary:
eROUTINGguide.com is easyTMS. The eROUTINGguide vision is to offer on-line tools that give small and medium size companies access to transportation management technology that was previously only affordable to large companies. Each module within the system is designed to save time, protect information, and improve decision making for the logistics professionals in that organization.

• ShipAssist - Provides tools that help companies by preventing accessorial charges and improving communication with carriers.
• Online Routing Guide - Improves inbound and outbound routing guide compliance, reducing costly errors and service issues.
• easy TMS - Helps businesses reduce freight costs through ensuring better carrier rate management, shipment routing decisions, and carrier communication.

Each tool is simple to implement and has an ROI of days, not months or years.

ShipAssist:
ShipAssist provides easy access to an online location for shipping department to post facility rules and regulations, maps/directions to their facility, or any other information a shipper wants to communicate to carriers. As a standard procedure, the shipper directs carriers to their personalized site to review the facility’s regulations and provide a documented acknowledgment of acceptance of the rules. The main benefits of the service are to set clear guidelines and expectations for carriers to prevent disagreements over detention or other accessorial charges, as well as eliminate calls to the shipping department asking for directions or other requests for basic information. There is ASN (Advanced Shipment Notification) functionality available as well.

The target market for the service is a manufacturer with one location, or a national retail chain with multiple locations, each having unique receiving requirements.

Online Routing Guide:
eRouting Guide provides an online location for companies to post their corporate routing guide in an open or password protected environment. The routing guide information is posted on a personalized site for the business and can be customized with any relevant content. Instead of sending out hard copies of routing guides, potential users can reference the information online. Updates can be made instantly and notification of any changes are sent immediately. Routing compliance is improved, therefore reducing time and expenses incurred to the business resulting from misrouted shipments. The goal is to make sure each shipment is routed the right way every time. There is ASN (Advanced Shipment Notification) functionality available as well.

The target markets for the service are any manufacturer with vendors or suppliers sending inbound product or companies with de-centralized shipping origin point.

Negotiating Tips Part #2 - Logistics Services

2010-08-08T13:51:00.003-04:00

Here is part #2 on some tips for negotiation with logistics providers. Missed part #1?

Never be the first person to name a figure...
This is an expensive lesson to have to learn, but a good one. I do a lot of contract work, and one of the first questions I'm usually asked is "What's your hourly rate?". This is a high pressure question, and I often found myself blurting out a figure that was lower than what I really wanted.

These days, I've learned the importance of getting the other person to say a number first. Now, I respond to that question by asking "What's the budget for this contract?". Often, I'm surprised to discover they're offering me a better deal than I thought they were.

Ask for more than you expect to get...
Once the other person's given their figure, even if it's much better than you expected, say something like "I think you'll have to do better than that". Don't be arrogant or aggressive. Just say it calmly.

When they enquire about your expectations, ask for more than you expect to get. Few people will walk away from a deal once it's commenced, and you can let the other person feel as if they're winning by lowering your "unrealistic expectations" a bit at a time.

Let them believe the final decision doesn't rest with you...
Once a negotiation starts, most people want to get it over with as quickly as possible. Let their impatience beat them. One great way of doing this is to let them believe the person they're negotiating with isn't actually you, but some other "authority figure".

Say something like "Well, I'll have to talk it over with my boss before I can give you a definite yes".

A skilled negotiator will always want to talk to the person who has the final decision, but don't let them do it. Say the person with the authority over the deal wants you to sort things out but still needs to have the final say. Tell them you'll discuss it and get back with an answer tomorrow. Ask them to make sure that's their best offer you can take to your "authority figure".

Don't act too interested...
Just giving the impression that you're willing to walk away can do wonders for getting a better deal. Always play the reluctant buyer or seller.

Don't leave the other person feeling as if they've been cheated...
Many people try to screw every last drop of blood from any negotiation. This is a mistake. If the other person feels they've been cheated, it can come back to bite you. They may not fulfill their part of the deal, or refuse to deal with you in the future.

Most negotiations should leave both parties feeling satisfied with the outcome. Be willing to give up things that don't really matter to you in order to create a feeling of goodwill. For example, if I'm renegotiating my order fulfillment per pick charge, or pack and ship rates downwards, I'll often offer to sign a longer legnth contract. That way, the provider has a commitment for my business for a longer time.

Ken is a 15 year veteran of supply chain logistics and has founded companies in the ecommerce fulfillment and transportation management software markets.

Negotiation Tips Part #1 - Logistics Services

2010-08-01T13:36:00.009-04:00

As a logistic professional, negotiation is crucial part of managing relationships with your supply chain vendors - whether it is negotiating carriers rates and contracts, pick and ship rates for fulfillment, or an implementation of a new logistics software to support your operation's Routing Guide.

Don't take it personally...
A mistake that people often make when negotiating is to become too emotionally attached to winning. They shout, threaten and demand to get their way. This is counter-productive.

Most deals are only possible if both people feel they're getting something out of it. If the person across the table feels attacked, or doesn't like you, they probably won't back down. Many people hate bullies, and will be more willing to walk away from a transaction if it involves one.

Keep calm, patient and friendly, even if the other person starts losing their cool. Make sure you leave any pride or ego at the door. You're much more likely to do well that way.

When you are reviewing a proposal from a vendor, don't get suckered by the "rules" trick...
When someone sends me a contract to sign, if there's something on there I don't like, I'll cross it out. I'm also happy to write things I want added in if I think they should be there. Sometimes, the other party will come back to me and say "You're not allowed to make changes to our contracts like that".

This highlights a common tactic used by experienced negotiators. They know many people are sticklers about following rules. So they'll make up official sounding pronouncements and insist that "this is the way it's done" or "you're not allowed to do that". If someone starts trying to box you in by adding rules to the deal, ask them to provide proof that such rules really exist.

Look for Part #2 of this post next week.

Ken is a 15 year veteran of supply chain logistics and has founded companies in the ecommerce fulfillment and transportation management software markets.

Discussing the start up of eRoutingGuide on This Week in Startups

2010-07-26T21:17:00.008-04:00

We went live with our new transportation management software site, eRoutingGuide this week. Coinciding with that, I made an appearance on the popular live web show, This Week in Startups (http://www.thisweekin.com/). I was part of the "Ask Jason" segment - looking for some ideas for finding an online community of logistics professionals. Here is a link to the show you can view on YouTube:

http://www.youtube.com/watch?v=SqSaek5yB1s

On August 13th I will be on another start up program http://www.asable.com/ talking about eRoutingGuide. Check out their site as well.

I have a few more appearances lined up in the next few weeks to talk about entrepreneurship with a focus on order fulfillment and other logistics services.

Fuel Surcharges make up 40% of your logistics management costs - know how they work

2010-07-06T10:07:00.003-04:00

Fuel Surcharges make up 40% of your logistics costs – you need to know how they work

Around 10 years ago is when fuel surcharges became ubiquitous. Prior to that time, the cost of fuel was always there of course, but in those days shippers essentially paid for fuel as a part of their linehaul rates. The market changes in fuel costs were for the trucking companies to worry about. The impact of fuel was something left to maybe negotiate at year’s end, or perhaps as part of a contract renewal. The shipper’s perspective was that managing fuel costs were a trucking company’s problem to understand and account for. Since that time, the burden of dealing with market changes in fuel costs has shifted from the trucking companies to shippers.

With fuel surcharge making up 30-40% of a typical company’s logistics costs it important for managers in both operations and finance to know how fuel surcharges are calculated and how the diesel market affects their freight spend. These days shippers are directly exposed to the potentially budget crushing fluctuations in fuel costs and the curiously structured surcharge matrices. Theoretically the fuel surcharge tables that most carriers use are a direct representation of actual fuel costs to calculate the fuel surcharge but I have yet to be given an explanation that makes me feel comfortable that the matrices are more than just an extension of a carrier’s line haul costs. This is not to say that fuel costs are not a major cost factor for carriers, I just disagree that the tables represent the impact of fuel accurately for a carrier from an operating perspective. There is too great of a difference from carrier to carrier for it to be a true representation. This tells me there is a “fudge” factor built into the numbers allowing carriers to hide operating costs beyond just fuel in the fuel surcharge matrix.

An ecommerce company shipping from a order fulfillment operation? For small package shipping, companies are at the mercy of UPS and Fed Ex for not just air and ground services and pricing, but to both company’s own fuel surcharge tables. There is not a lot to understand about small package fuel surcharge other than to know you have to think of the cost as an extension of their pricing and pay attention as the fuel prices change – for better or worse.

For truckload and LTL shipping, you’ll see fuel surcharge matrices calculated as both a per mile and a percentage of line haul cost basis. In both cases – the fuel surcharge table will be based on the US Governments Diesel Fuel Index (posted on the DOE website). It is updated weekly and is also calculated on a regional and national basis. Depending on the footprint of your trucking company either type of fuel index could apply. The “per mile” basis is simply calculated by adding the per mile charge on top of your line haul rate, then multiplied by the number of miles shipped. The “percentage” type surcharge takes the cost of the shipment (for LTL, the discounted tariff rate and for TL, the linehaul portion) and adds the percentage of cost derived from the table on to that. Just like you audit line haul costs on freight invoices, it is also important to audit fuel surcharges.

Fuel matrices are generally built to adjust with every $.05 increase or decrease in the DOE diesel fuel index and are effective for any shipments tendered in a given week’s period of time.

Ken is a 15 year veteran of logistics and supply chain operations. He has founded companies in the ecommerce order fulfillment and transportation management system markets.

Startup Order Fulfillment and Social Media for Logistics

Eco-Friendly Packing Materials For Ecommerce Order Fulfillment

2010-06-29T10:08:00.002-04:00

The most ubiquitous packaging materials at ecommerce order fulfillment operations are of course bubble wrap and peanuts. The pros and cons of both are well documented, but the most important thing to know is they are typically made from plastics (as in oil) and are not bio-degradable. With the amount of bubble wrap and peanuts used around the world each day the problem is pretty self evident.

These products are made from some pretty nasty stuff Polyethylene, Polystyrene and Polyurethane (which consists of all sorts of harsh chemicals including acetone, methylene chloride and fluorocarbons).

Aside from the toxic chemicals used with most plastic based packing materials and the huge energy resources that going into creating them; the amount of landfill taken up after they are discarded is significant.

Here are some ideas for alternative packaging options to consider using when preparing your customer orders for shipment.

Soy based expandable foam products are a more eco-friendly option. Derived from soy, and therefore renewable and biodegradable, this product conforms precisely to the shape of your products. This maximizes protection by minimizing movement on the inside of the carton. The product is also very light weight, reducing the additional shipping expense of heavier materials. Realistically expandable foam is best for larger operations due to the space the specialized equipment and process will require.

Consider using old newspapers as they can also be a good option as well. Shredded or balled up newspaper has decent cushioning ability. My opinion is that shredded paper has a neat look in the box and adds some “eco-cred” to your products. Aaesthetically the balled up news print leave a little to be desired, and there is no efficient way to “ball up” enough paper to keep up with a high volume fulfillment operation. Shredded paper, although requiring an extra step (to shred) does led itself to a higher volume set up.

Again, it’s not as pretty, but old cardboard boxes can be cut into strips and then rolled tightly. Place the rolls vertically into the packing box around the item in the box, the rolls will then expand providing a cushion. Similar to newsprint, if some care is taken up front to cut or prepare the boxes neatly the end product could work in a way that looks good to your customers.
Reusing something like paper or cardboard for packaging is always preferable to recycling, and of course, MUCH better than throwing those items away. Cushion packaging is sold that is made from one hundred percent post consumer waste paper – give that a try if you don’t like the look of used newspapers.

Biodegradable packing peanuts are available, made from grain sorghum and corn starch. For environmentally friendly soft foam in rolls, starch-based products such as GreenCell have the added bonus of being anti-static which is great for cushioning computer parts and electronic equipment.

For wrapping and packaging inside the box, use or reuse something. And the same goes for the cartons you are using - go for boxes made from recycled cardboard. The options these days for recycled corrugated boxes are very diverse and any place selling boxes will likely provide these product options as well .

Ken is a 15 year veteran of logistics and supply chain operations. He has founded companies in the ecommerce order fulfillment and transportation management system markets.

Three benefits to automating your freight invoice audit process

2010-06-28T09:37:00.001-04:00

Reduce Freight Costs:

First off - the reality is a lot of freight invoices are incorrect, so they all should be checked. Mileage calculation errors are common and the complexity of fuel surcharge matrices mean that the applicable surcharge changes week to week. Do a spot check of some invoices and I can promise the wrong surcharge is getting applied on some shipments. Partnering with a resource to help automate this auditing process will make it simple for you. Most freight invoice auditors will claim a freight savings of 2-6% off your logistics spend. I can’t verify that either way, but I do agree an opportunity for savings exists. On the high end, you should expect to pay $.80-.85 per invoice, but much less with higher volumes of invoices or using EDI to facilitate the process. This would involve getting each of your carriers to interface electronically with the freight payment company. This is a bit complicated to get started with but will become relatively simple to maintain once the whole process is in place.

Reduced Shipping Administrative Expenses:

Companies conducting their freight invoice audit in-house are using expensive employee resources to ensure carrier invoices are correct - and probably not very effectively. Realistically, a manual freight audit is not able to uncover the same number of carrier audit billing errors and shipping service failures that an automated freight invoice audit process is able to identify. Automating the invoice audit process will eliminate the excessive time currently allocated to these tasks and as a result generate additional cost reduction in time saved. Think about it – how are your carrier rates sheets organized right now? Hardcopy print outs in a drawer? Maybe a spreadsheet attached to an email in someone’s inbox? How efficient or accurate is it for someone to be auditing each carrier’s invoice by referencing one of those sheets, running the miles, adding stop charges, and accesorials – and doing it correctly? Plus – they need to check this week’s fuel surcharge from the DOE website, reference yet another table provided by the carrier, and add that amount to the carrier charge. You do all this for one truckload, when you can automate the process in a way that eliminates the work and the potential errors.

Freight Management & Carrier Reporting:

From a business management standpoint, this is the possibly the most valuable benefit of automating freight invoice audit. Information. The importance of knowing all your freight data is accurate and accessible allows for effective business reporting and use of that data. Understanding your logistics and supply chain costs in detail is vital to effectively running a business. Attempting to manually audit and collect freight data is too time consuming and very error prone. Think about the valuable components of freight spend data. The better you understand the cost components that make up your freight spend, the better you manage your business. If you keep getting hit with detention a particular consignee you what to know about… if freight costs are going up because of fuel, you want to know about that too. Good information is vital to making your business run better.

Ken is a 15 year veteran of logistics and supply chain operations. He has founded companies in the ecommerce order fulfillment and transportation management system markets.

The Benefits of Saas for Logistics Management

2010-06-25T12:52:00.002-04:00

Benefits of SaaS (Software as a Service) for Transportation Management
In the old way of thinking, companies were used to buying, building, and maintaining their IT infrastructures despite exponential costs. SaaS gives companies an alternative to those headaches. Now, a company can plug in and subscribe to services built on shared infrastructure via the Internet. The SaaS model has gained popularity in recent years because of the many benefits it offers to businesses of all sizes and types, but it also begs several questions and considerations to be thought of as well.

The main benefits that are attracting businesses customers to take advantage of SaaS solutions for Transportation Management:

Higher Adoption Rates: SaaS applications are easily accessible from any computer or any device—anytime, anywhere. Because most people are familiar with using the Internet to find what they need, SaaS apps tend to have high adoption rates, with a lower learning curve.

Lower Initial Costs and Easier IT Implementation: SaaS applications are typically subscription based. No license fees mean lower initial costs. Having the SaaS provider manage the IT infrastructure means lower IT costs for hardware, software, and the people needed to manage it all.

Automatic Upgrades: Because the SaaS provider manages all updates and upgrades, there are no patches for customers to download or install. The SaaS provider also manages availability, so there’s no need for customers to add hardware, software, or bandwidth as the user base grows.

Seamless Integration: SaaS vendors with true multitenant architectures can scale indefinitely to meet customer demand. Many SaaS providers also offer customization capabilities to meet specific needs. Plus, many provide APIs that let you integrate with existing ERP systems or other business productivity systems.

Items to think about when considering a SaaS solution:

Data Security is more than just user privileges and password policies. It’s a multidimensional business imperative, especially for vendors responsible for customer data. Make sure any provider you’re considering has solid policies and procedures in place to guarantee the highest possible levels of security. Carrier and order fulfillment services contracts need to be kept safe.

With on-demand applications, customers rely on their providers to keep systems and data available. You need to trust your SaaS provider to meet your business requirements, so expect them to communicate with you as a partner in your business. You need to have access to your transportation data and systems from anywhere.

Scalability is important. With any utility, customers benefit from the scale of the supplier. Scale provides a larger customer community that can deliver more and higher-quality feedback to the vendor to drive future innovation. And a larger customer community provides rich opportunities for collaboration between customers. Make sure the vendors you’re evaluating provide:

Any vendor providing on-demand services should be professionally paranoid, considering every potential disaster, and being prepared for anything.

Data backup procedures should create multiple backup copies of customers’ data in near real time at the disk level. The strategy should include a multilevel backup strategy that includes disk-to-disk-to-tape data backup where tape backups serve as a secondary level of backup, not as their primary disaster recovery data source. Failover should cascade from server to server and from data center to data center in the event of a regional disaster, such as a hurricane or flood.

Any provider offering SaaS applications needs to be able to deliver very high availability. A detailed history should be available. Vendors should provide availability data on the entire service, not just on individual servers.

Kenneth Kowal is a logistics professional with over 15 years supply chain management experience. He has founded two companies: TMS logistics solution provider and startup ecommerce order fulfillment company FillShip.com.

Top 5 Benefits of Business Process Outsourcing to your Supply Chain

2010-06-07T21:27:00.004-04:00

What supply chain functions are currently outsourced within your organization?
Today, the current economy has presented a variety of opportunities for businesses to outsource many supply chain functions and responsibilities traditionally done in-house.

Business process outsourcing (BPO) is a method of outsourcing that involves the contracting of operations and responsibilities of a specific business functions or processes to a specialized service provider. An example would be an ecommerce company outsourcing its startup order fulfillment operation.

Within the context of a company’s supply chain, these business functions could include carrier contract negotiation, freight audit and payment, fulfillment, and many others. A Logistics Service Integrator (LSI), sometimes call a 4PL (4th Party Logistics Provider) takes the role of independently managing a company’s outsourced functions, utilizing their expertise to bring the most value to the organization.
Below is a list of 5 benefits companies are able to realize through outsourcing.

TOP 5 Benefits of Business Process Outsourcing

1. Best in Class Capabilities

Best in class service providers make significant investments in technology, methodologies, and people – because what you outsource to them is their business. Their expertise lies in the experience gained by working with many clients in similar industries and having faced similar challenges. The combination of specialization and expertise gives businesses the benefits of both while avoiding the cost of investing in technology and infrastructure to support the function. With the right partnership in place, businesses can quickly realize the benefits of a new or reengineered process through dramatic improvements in critical performance measures such as cost, quality, service, and speed. The areas best suited for outsourcing are often those that are not core to the company’s business as these will be the areas not prioritized for needed attention and improvements from a company’s already limited available resources. By outsourcing the non core function to a Best in Class provider, the company can begin to see the benefits much sooner and at a lower cost.

2. Better Use of Company Resources

Outsourcing enables an organization to redirect its resources, most often in the form of people and IT resources, toward activities which are closer related their core business. Outsourcing lets a company focus on its core business by having operational functions assumed by an outside expert. Freed from devoting energy to areas that are not its area of expertise, the company can focus its resources on what it does best and as a result better meet its customers' expectations.

3. Reduce Operating Costs

Organizations that try to do everything themselves may incur significantly higher research, development, marketing, training, and deployment expenses, all of which hurt profitability or are passed on to the customer. An outside provider's lower cost structure, which may be the result of a greater economy of scale or other advantage based on specialization, reduces a company's operating costs and increases its competitive advantage. Costs are reduced through smoothing out demand variability since the outsource company bears the majority of fixed costs. Outsourcing reduces the need to invest capital in non core business functions. Instead of acquiring the resources through capital expenditures, they are contracted for on an "as used" operational expense basis. Taking advantage of new on-demand system such as a Transportation Management System is better than creating an in-house TMS.

4. Reduce Business Risk

Significant risks are associated with any capital investments a business organization makes. Dynamic markets, aggressive competition, complicated government regulations, changing financial conditions and technologies all change extremely quickly. Keeping up with these changes, especially those in which the next generation requires a serious investment, is a very risky proposition. Outsourcing providers make investments on behalf of many clients, not just one, so the shared investment spreads risk, and reduces the risk a single company has to bear.

5. Company Lacks Necessary Resources

Businesses outsource because they do not have access to the required resources within the company. This can be in the form of a lack of intellectual capabilities or more tangible assets such as sufficient systems or staffing. Outsourcing is often the most viable option for building or improving a needed capability. It is critical to remember that outsourcing doesn't mean abdication of management responsibility nor does it work well as a knee jerk reaction by a company in trouble. When a function is viewed as difficult to manage or out of control, the organization needs to examine the underlying causes. If the requirements expectations or needed resources are not clearly understood, then outsourcing won't improve the situation; it may in fact exacerbate it. If the organization doesn't understand its own requirements, it won't be able to communicate them to an outside provider.

Ken is a 15 year veteran of logistics and supply chain operations. He has founded companies in the ecommerce order fulfillment and transportation management system markets.

New website for ecommerce retailers is Live! Fillship.com

2010-06-07T10:17:00.005-04:00

We are proud to announce that the new FillShip.com website is live.

FillShip operates its ecommerce order fulfillment operation from a state of the art 600,000 sq ft food grade storage facility in eastern PA. The fulfillment customer portfolio ranges across a variety of customers, from frozen food to consumer electronics.

The FillShip value proposition:

Fillship.com is your shipping assistant. Focus on growing your business, and Fillship will take care of storing and shipping your product. Simply send us your merchandise to store – and when a customer places an order we take care of packing and shipping the order. Our east coast location promises you the quickest delivery and lowest shipping costs to the majority of the US population. Simple set up with professional program management.

Inquiries: customerservice@fillship.com or call 717.889.8509 or http://www.fillship.com/.

Thanks to Rob Tompkins at Landis Logistics for his support.

Fillship is an affiliate of TMS provider, eRoutingGuide.

Options for Business Process Outsourcing in the Logistics Industry – 3PL vs. Logistics Services Integrators (a.k.a. 4PL)

2010-06-02T20:54:00.001-04:00

Business Process Outsourcing can be a practical and beneficial option for most companies. Organizations outsource for many reasons, with the desired outcome being reduced costs, improved operations, overcoming a lack of internal capabilities, gaining competitive advantage, and other benefits that are both tangible and intangible.

Outsourcing can be used in many parts of a business, but most often for what a company defines as non core functions; accounting, legal, human resources, information technology, manufacturing, sales, sourcing and logistics /supply chain management. Of course “non core” and “core” differ by company and industry. Non core can be important and critical to a company, but does not define the company and set it apart from competitors.

When it comes to logistics and supply chain management, there are two primary methods to take advantage of business process outsourcing – 3PL and Logistics Service Integrators (also known as 4PL or 4th Party Logistics).
3PL (3rd Party Logistics provider).

For about the last 20 years, 3PL’s have led the way in logistics outsourcing. Drawing on its core business, whether it be trucking, order fulfillment, warehousing, etc. - 3PL’s have expanded their offering with new or additional services. It presents a way for essentially a commodity type service logistics provider to move into higher margin, bundled services and further develop and leverage their customer relationships.
Customers, seeing value in the concept of the 3PL and always looking to reduce costs, have recognized value in the concept. The result is the market opportunity for outsourced logistics service providers, whether domestic or international became and remains sizable.

Unfortunately the reality has not lived up to the promise. The reasons are varied, but the bottom line is many 3PL’s have failed at their own business transformation beyond adding the “Logistics” moniker to their company name. Often 3PLs have not successfully moved past their core commodity service to become true multi-service providers – the trucking company is still just providing trucking services, not providing value or improving the customer’s logistics network. Others have failed to differentiate themselves against the competition. Many 3PL’s have done a poor job positioning and defining themselves in the marketplace while others have commoditized their 3PL service, as a result undoing the very purpose of their 3PL.

The complicated and varied methods for how 3PL’s look to be paid for services has added to the challenge. Shared savings, contingency and transaction based fee structures are among the many ways 3PL’s are compensated. The very method for how a 3PL is paid can be in direct conflict with the best interests of the customer whether it be a consideration of cost or service. Customers can still find they have no understanding of their true costs and service performance with all the shipping data and information moving through a 3PL.

These setbacks have prevented the growth of some 3PLs in terms of both retention and new customers. Broad fragmentation of the sector reflects both the uncertainty of how 3PLs view themselves and the diversity of customer needs. With the involvement of multiple 3PL’s customers are often forced to deal with proposals or solutions that cannot be measured against one another.

Business Process Outsourcing and the Logistics Service Integrator (LSI).

First, note that Business Process Outsourcing (BPO) is not traditional outsourcing. Traditional outsourcing is typically taking a set of tasks or functions and simply moving them to an outside service provider. A BPO provider, or in the case of the supply chain/ logistics industry, a Logistics Service Integrator (LSI), brings an expert perspective, specific knowledge and experience as well as technology to an organization. The LSI works with the company to develop a solution to improve an existing or new process through independent and unbiased analysis and recommendations.

From the service vacuum created by 3PLs, the LSI has emerged. Using a Logistics Service Integrator is much different than the traditional 3PL. The LSI is a BPO provider, is neutral, and will manage the logistics process correctly, regardless of what resources need to be used. This includes carriers, fulfillment vendors, freight payment providers, 3PL’s, or any other logistics service providers that are part of the company’s network.

The goal of the LSI is to represent the interests of the customer by bringing their specific expertise into the qualification and management of the logistics service providers. An LSI wants to position itself as an extension of and as part of its customer.

Conclusion. Although born out of good intentions, in general 3PL’s have not fully served the purpose for which they were conceived. The reality is 3PL’s have remained too focused on managing tasks and transactions in a very short sited way, and not on the important broad focus and processes of their customers. The results are missed opportunities to present real value to the organization being serviced. Logistics Services Integrators have become a good alternative for business process outsourcing. The value lies in the LSI being positioned as an extension of the organization itself. Processes are analyzed, logistics technology evaluated, and vendors qualified independently based on the unique needs of the business, with no preconceived ideas or over-riding commitment to a 3PL’s own interests. LSI’s are compensated based on the value they add, with complete transparency of costs for the business they have partnered with.

Ken is founder of two logistics supply chain management companies in the ecommerce order fulfillment and transportation management system markets.

Freight Costs are more than just the state to state rate...

2010-06-02T09:38:00.006-04:00

Okay - so you've negotiated some great state to state rates with your truckload carriers. With fuel accounting for 30%+ of transportation costs these days, and the potential for big accessorial charges being occurred at any time from pick up through to delivery, there are a lot of factors to be paying attention to when it comes to managing your logistics costs.

The bottom line is a lot goes into your company's transportation spend beyond just the per mile rate. The following are some important factors to think about that are likely making up 50% or more of your logistics management budget.

Fuel Surcharges - The aforementioned cost of fuel is likely making up over 30% of your transportation spend. Fuel surcharge are a factor largely out of a shipper's control (aside from finding ways to be more efficient with how your trucks are routed - because less miles shipped equals less fuel costs) but paying attention to movements in the price of diesel fuel is vital to budgeting and anticipating the cost impact on your business. Truckload carriers will typically use a company's own standard fuel surcharge matrix, so if you have not already done so get your carriers on the same fuel table. It will provide more consistency on your costs and make invoice audit easier.

Avoiding detention – Make sure your dock scheduling process is working. For many shippers detention charges make up the next largest piece of cost beyond linehaul and fuel charges. Detention happens when a truck shows up at your facility to pick up a load and it is not ready. The cost impact to the shipper can run from $50 to $200+ per hour. Make sure your production planning and logistics group are communicating and product is shipping on time. Obviously getting products to your customers on time and in good shape is often the priority but there could be significant costs being incurred by your business as well.

Product damage and returns – A lot of time and cost is spent dealing with and resolving issues with product damage and returns. The following is a list of best practices for shipping to help manage the issues.

Best Shipping Practices:

- Know what a carrier's liability limits are before shipping.

- Use only new packing material, use of used cartons or packing may limit your ability to receive full value for any loss or damage.

- When necessary, verify the identity of the driver before loading his truck.

- Properly complete the bill of lading using correct classification descriptions.

- Clearly mark any special delivery requirements on the bill of lading.

- Make sure the driver clearly signs the bill of lading noting the total number of "outside" pieces received.

- Never permit a driver to sign "shippers load and count (SLC)" unless he is signing for a sealed load.

- Make sure all trailer loads are sealed by your personnel.

- Record seal numbers on the bill of lading before it is signed.

- When shipping hazardous materials make sure the individual preparing and offering the shipment to the carrier is properly trained and certified to handle hazmat shipments.

Ken Kowal has 15 years experience in logistics supply chain management and is founder of companies in the ecommerce order fulfillment and the transportation management system markets.

Visit out other blog - Truckload Pricing Trends

Press Release - ShipStarter.com: Turnkey Order Fulfillment Services for Online Retailers

2010-06-02T08:49:00.006-04:00

Press Release:

May 24, 2010 - Lancaster, Penn.

ShipStarter.com announces new turnkey order fulfillment services catering to small and medium size ecommerce businesses.

ShipStarter operates its ecommerce order fulfillment operation from a state of the art 200,000 sq ft food grade storage facility in eastern PA (serving New York and New Jersey and clients nationally). The fulfillment customer portfolio ranges across a variety of customers, from frozen food to consumer electronics.

The Order Fulfillment value proposition:

ShipStarter.com is your shipping assistant. Focus on growing your business, and Fillship will take care of storing and shipping your product. Simply send us your merchandise to store – and when a customer places an order we take care of packing and shipping the order. Our east coast location promises you the quickest delivery and lowest shipping costs to the majority of the US population. Simple set up with professional program management.

Fillship is an affiliate of eRoutingGuide, Transportation Management System.

Logistics Fuel Surcharges

A new type of TMS (Transportation Management System)

2010-05-27T10:59:00.001-04:00

May 21, 2010 – eROUTINGguide.com announces plans for the July 2010 launch of its innovative new online transportation management system (TMS). Its TMS 2.0 – an easyTMS solution in the cloud.

The simple application represents a new way for companies to manage and control their logistics process from start to finish. Each module within the system is designed to save time, protect information, control costs and improve decision making for the logistics professionals in that organization.

easyTMS – Organized, secure carrier contract management with Tools for Carrier Selection, Route Optimization, Load Tendering, and Invoice Audit is what is does. Just as importantly, easyTMS provides services in a SaaS, or on-demand environment making implementation and upkeep simpler for users and per user costs a fractional of traditional TMS systems.

Ship Assist – Resolve disputes over Detention and other accessorials before they happen. With Ship Assist, all carriers delivering or picking up shipments from your facility sign off on the procedures at your shipping dock via a customized online webpage – creating a clear understanding of the rules and preventing future disputes.

Routing Guide – Reduce your headaches and transportation costs at the same time by improving compliance to your company’s Routing Guide. This on-line tool provides a simple, clean process for updating and distributing your Routing Guide.

Inquiries: kkowal@eroutingguide.com or call 717.889.8509 or visit: www.eroutingguide.com

eROUTINGguide provides order fulfillment services for e-commerce businesses.

Supply Chain Technology and TMS

2010-05-26T18:00:00.001-04:00

I found this interesting article by Logistics Management Magazine containing and interview with Adrian Gonzalez from ARC Group. It touches on Supply Chain Technology and TMS (Transportation Management Systems).

http://ow.ly/1Q62d

Adrian also has a blog that is very much worth following.

Shipping Considerations for Online Ecommerce Retailers

2010-05-21T09:00:00.005-04:00

A significant expense for any online retailer is the order fulfillment process which includes the storing, packaging, and shipping of a customer’s orders. This is beyond the cost of sourcing the merchandise, regardless of what the business sells, plus marketing and other cost of sales expenses. Taken in total, all these costs have to be managed effectively for a business to maintain profit margins. A positive margin is obviously vital to the success for any online retailer. The good news is making the right decisions regarding the storing, packaging, and shipping components could possibly be the easiest to influence on that list with the most substantial impact for the betterment of your business.

The following are three main cost considerations for start up online retailers when it comes to shipping.
1 – Supplies. These include the packaging material (or dunnage) to fill around and protect the merchandise as well as the carton itself.
2 – Direct Shipping Costs. Your selection of who ships the order (USPS, UPS, Fed Ex?) and at what service level (Ground, Next Day Air, etc.) impact costs tremendously.
3 – Your Time. Is packing boxes, dealing with storage, and printing shipping labels the best use of your time? As a small business owner you should be asking yourself constantly throughout the day – Is what I am doing right now helping to make my business more successful?

Supplies – Basic shipping cartons in a limited range of sizes are free from the USPS, Fed Ex, and UPS. That’s a good option if what you are shipping fits and is not either too big or too small. Shipping a lot of empty space in every box with your merchandise is not efficient and many businesses prefer to exert more control over the customer experience with custom or specialized packaging for shipping orders. The packing material used to protect the merchandise comes in a lot of options – with some even being eco-friendly (such as styrofoam “popcorn” and expandable foam made from soy). The additional expense of customized packing materials and cartons has to be considered.

Direct Shipping Costs – The 3 main options for shipping small packages in the US are the USPS, UPS, and Fed Ex. All three offer a form of Ground (slowest and cheapest service) as well as several expedited (overnight, 2 day, etc.) delivery services. Volume speaks when you ship with UPS and Fed Ex so talk to your rep about volume discounts that will kick in once you hit certain volume thresholds. Watch out for residential delivery charges with UPS and Fed Ex. USPS pricing is generally lower – but service time are also generally slower and there are less shipment tracking options for the order as well. There is a hybrid solution in which a company (could be UPS, or DHL Globalmail, or several others) acts as a “mail integrator”. These companies pick up on their own trucks but then take the packages to the USPS who takes care of the final delivery. This set up works best in a business to consumer model and requires a minimum daily quantity of packages (usually about 250 per day).

Your Time – Again, is printing shipping labels the best use of your time? The excitement and desire to grow a business is what motivates most online business owners. Focus on helping customers fill their shopping carts.

eROUTINGguide - a new "easy TMS" SaaS Offering for Logistics

2010-05-19T08:39:00.001-04:00

Here is an overview of a new system we have in development that can perform many Transportation Management System functions at lower price points that tradition TMS Systems, and with easier implementation.

Our targeted go live date is July 1, 2010 and are looking for shippers interested in beta testing any of the functionality.

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Executive Summary:

eROUTINGguide.com is easyTMS. The eROUTINGguide vision is to offer on-line tools that give small and medium size companies access to transportation management technology that was previously only affordable to large companies. Each module within the system is designed to save time, protect information, and improve decision making for the logistics professionals in that organization.

• ShipAssist - Provides tools that help companies by preventing accessorial charges and improving communication with carriers.
• Online Routing Guide - Improves inbound and outbound routing guide compliance, reducing costly errors and service issues.
• easy TMS - Helps businesses reduce freight costs through ensuring better carrier rate management, shipment routing decisions, and carrier communication.

Each tool is simple to implement and has an ROI of days, not months or years.

ShipAssist:
ShipAssist provides easy access to an online location for shippers to post facility rules and regulations, maps/directions to their facility, or any other information a shipper wants to communicate to carriers. As a standard procedure, the shipper directs carriers to their personalized site to review the facility’s regulations and provide a documented acknowledgment of acceptance of the rules. The main benefits of the service are to set clear guidelines and expectations for carriers to prevent disagreements over detention or other accessorial charges, as well as eliminate calls to the shipping department asking for directions or other requests for basic information. There is ASN (Advanced Shipment Notification) functionality available as well.

The target market for the service is a manufacturer with one location, or a national retail chain with multiple locations, each having unique receiving requirements.

Online Routing Guide:
eRouting Guide provides an online location for companies to post their corporate routing guide in an open or password protected environment. The routing guide information is posted on a personalized site for the business and can be customized with any relevant content. Instead of sending out hard copies of routing guides, potential users can reference the information online. Updates can be made instantly and notification of any changes are sent immediately. Routing compliance is improved, therefore reducing time and expenses incurred to the business resulting from misrouted shipments. The goal is to make sure each shipment is routed the right way every time. There is ASN (Advanced Shipment Notification) functionality available as well.

The target markets for the service are any manufacturer with vendors or suppliers sending inbound product or companies with de-centralized shipping origin point.
easy TMS:
easy TMS provides simple, easy to implement Transportation Management System functionality for truckload volume shipments at a low monthly rate. The system is web-based, or a SaaS.

eTMS Functionality:

• Tool for organizing and securely storing carrier rate contracts in a central location, allowing companies to make sure the correct routing decisions are made on every truckload shipment. Rate sheets that in the past were buried in a drawer or non-existent are now in one location so in the event of employee turnover or a need cross train additional employees the information is accessible to the right people.
• The Rate Quote tool identifies the top 3 low cost carriers for a given shipment, calculating and presenting the mileage, line haul and fuel surcharge costs.
• The system eliminates time consuming phone calls and manual processes by facilitating communication with carriers through automatic load tendering functionality, appointment confirmations, and Bill of Lading generation.
• Freight invoice pre-audit is integrated into the tool, automating the audit process for shippers – saving time or the need for a costly third party invoice audit company.
• The Sales Quote tool allows parties outside logistics to calculate costs for sales or budgeting in a controlled environment, taking this burden off the shoulders of the logistics group.

The target market for the service are small to medium size shippers currently reliant on manual processes for managing their carrier rate contracts and carrier communication processes.

Order Management, Shopping Cart Software, Ecommerce Platform, Order Fulfillment for Startup

What is a TMS?

2010-04-29T14:51:00.003-04:00

Transportation Management System or Logistics Management (TMS) – What is it?

A Transportation Management System is software that helps businesses manage the execution of its logistics supply chain, in particular coordinating and optimizing the movement of products and materials.

The general functions and benefits of a Transportation Management System (Logistics Software) include the following:

Shipment Load Planning and Shipment Routing Optimization – This functionality helps in areas such as determining the most cost effective mode to ship an order (truckload, ltl, air freight, intermodal, etc.), or the optimal way to combine multiple orders together into larger shipments. Carrier rate agreements and contracts are often housed within this area as well.

Routing Guide – Helping to ensuring vendor compliance to inbound routing guides is crucial to cost management.

Execution Management and Carrier Communication – This includes tools for assisting with carrier selection, calculating shipments costs (including line-haul, fuel surcharges, and accessorial charges), tendering loads and facilitating carrier communication (bills of lading and proof of delivery).

Visibility/ Shipment Tracking – Providing delivery status updates and alerts, this tool allows proactive program management and notice of potential delivery problems in advance.

Freight Bill Audit & Payment – Automating the freight audit and payment process, saving time and improving accuracy, or ending reliance on an outside third party.

Other functions:
Business Intelligence/ Reporting
Claims Management
Order Fulfillment Returns Management
Appointment Scheduling

Transportation Management Systems can be deployed on client’s systems or on-demand SaaS (Software as a Service).

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visit our other blog: Truckload Pricing Trends and for more information on ecommerce order fulfillment services for ecommerce retailers and fulfillment for startup online retailers.