Category: Shipper Help

Are you reading your data incorrectly?

According to a report by Forrester, studies “found that while 74% of firms say they want to be ‘data-driven,’ only 29% say they are good at connecting analytics to action […] We also found that leading firms were turning data into insight and action by building systems of insight ― the business discipline and technology to harness insights and consistently turn data into action.”

It is common for many business owners to make the mistake of using their collected data to support an idea that they already have. For example, “My savings should go up if I switch from carrier A to carrier B.” Using your data, you calculate the cost difference and break down all the areas you can save money with carrier B. You may be thinking to yourself, well, what’s the problem with that? 

The problem is that there are better ways to use all those management and analysis programs. Taking advantage of that technology can remove personal biases and be the difference in what makes or breaks your business. Here’s another example. Let’s say the summer season is here, and volume requirements are ramping up in logistics. Maybe your data tells you that loading times have been increasing by 10%. But you already knew that, so there is not much insight to be found in that piece of data. However, if you can read your data and see that a particular carrier company arrives late 35% of the time and is making you lose profit, you can think about how to approach that issue in your business model and act accordingly. 

The statistics provided by Keboola below make a strong case for businesses investing in big data:

• Data-driven organizations are 23 times more likely to acquire customers.
• Businesses that use big data increase their profit by 8 percent. 
• 62% of retailers report that the use of information and analytics is creating a competitive advantage for their organization. 
• One-third of industry professionals highlight that the right technologies for data collection and analysis are essential for a better understanding of customers.
• Insight-driven businesses are growing at an average of 30% each year; by 2021, they are predicted to take $1.8 trillion annually from their less-informed industry competitors.

If you want to try employing actionable insights, approach your data set with no questions in mind. Read the data results objectively, and then try to draw conclusions about what you should do next. Of course, actionable insights won’t come to you each time you try this, and you should remember that you won’t necessarily have an immediate solution, or even find the insight useful to you. However, it sets you onto the right track to help shape the future of your business, with specific strategies geared toward generating the outcomes you want. Your process may lead you to adapt a new approach, rethink your current plan of action, or simply leave the information in the back of your mind.

One of the best ways for a company to begin adopting the actionable insight approach to their big data resources is to have the support of the  executive team. What the CEO prioritizes will trickle down to the company’s culture and become what the  employees prioritize. Employees follow the example given by their leadership, and a leadership team that invests in big data and emphasizes the advantage of following data-driven insights is imperative if you want your data to give you the edge and agility your business needs.

Harvard Business Review shared a 2019 study surveying top C-level executives, which found that “Companies report (77.1%) that business adoption of Big Data and AI initiatives remains a major challenge. Executives cite multiple factors (organizational alignment, agility, resistance), with 95.0% stemming from cultural challenges (people and process), and only 5.0% relating to technology.” According to this information, most of the difficulty in getting to the best of this technology is culture-driven, which loops back to the culture perpetuated by management. It might seem overwhelming, but don’t worry – there are many  technologies and solutions out there to help ease the learning process. (Harvard Business Review)

Putting together education initiatives for your employees, purchasing a management/analytics product, or hiring specialized employees for analytics are all ways to begin taking advantage of the valuable data sets right at your fingertips. Looking for more information on how to apply actionable insights? Keep reading our articles here at Zuum, and find an answer to your question. 

Source:

https://go.forrester.com/blogs/16-03-09-think_you_want_to_be_data_driven_insight_is_the_new_data/ 

https://www.keboola.com/blog/5-stats-that-show-how-data-driven-organizations-outperform-their-competition

https://www.tcs.com/content/dam/tcs-bts/pdf/insights/Big-Data-Executive-Survey-2019-Findings-Updated-010219-1.pdf

A 2012 study conducted by Logica found that, “most US-based organizations overspent by an average of 13% on their annual shipping costs.” Their Director of Logistics and Supply Chain Services, Thomas Andersen, went on to say this: “What worries me more is that companies aren’t aware of the problem […] From my experience, more than 90% of shippers could make minor changes that would generate double-digit savings. If they began to analyze the details of their transportation costs, it could make a big difference in their overall shipping spend.”

Since the study was conducted in 2012, costs have only continued to increase. In 2017, the Wall Street Journal shared the findings of a logistics study from the Council of Supply Chain Management Professionals, which stated “that total spending on shipping costs rose to a record of $1.5 trillion in 2017, upping 6.2 percent from the year before.” They expected “rising interest rates, higher costs of fuel and impending tariffs [to add to] business expenses.”

Most recently, e-commerce has skyrocketed due to the emergence of COVID-19, which has forced  businesses to be more agile and begin implementing change much faster than they previously did before. In regards to the effect left by the pandemic, CNBC has published this recent report statement from Jefferies analyst Janine Stitcher: “The recent growth in shipping costs has been fueled by the surge in e-commerce penetration, which has created a significant supply/demand imbalance and left carriers capacity constrained.”

Clearly this is a widespread issue. Business owners may realize that they can save costs in certain areas, but may have trouble pinpointing exactly where they can increase their benefits. What can you do to lower your costs as a shipper during these times? Go down this list with us and find out. 

Automate Manual Processes

Are you still using spreadsheets? Do you still do your paperwork by hand? If the answer to those questions is yes, one of the first ways you can begin saving money is by automating these manual processes. Switching to a document management system will cut down on labor costs and shrink your margins of error, as well as save you from hours of writing, filing, and organizing. Find a good management system to help you with your record and bill keeping, and reap the profits of more time and higher accuracy. 

Use a Third-Party Logistics Company

The world of supply chain and logistics is fast moving and competitive. When you have a hundred other things to think about, it would be prudent to consider the services of a third party logistics company. They have years of experience in streamlining the processes giving you trouble, and they also have access to technology that can truly optimize your freight experience. What would be most helpful is a logistics product or service where they can help you analyze and combat your pain points. This can range from alerting you of upcoming market trends to which lanes are the cheapest and most consistent. 

Minimize Shipping & Packaging Costs

Spend some time looking at your minimal expenses. Can you switch from a heavy packaging option to something light and inexpensive, like bubble mailers or envelopes? If not, start buying your shipping supplies in bulk and save on packaging expenses. Buy a scale and pallet if you don’t own one already, and make sure to weigh your shipments before they leave the warehouse so you can avoid reweigh and reclassification costs.

The actual cost to wrap and ship your packages have a plethora of tiny costs associated with it, which are based on parameters such as packaging type, shipment weight, tariffs, etc. These costs are relatively tiny, but tiny costs add up, and that is extra money that could be spent elsewhere in your business. You should also consider reusing and recycling where you can, which is cost-friendly and sustainable. 

Reduce Returns

Another way to reduce your costs as a shipper is to start identifying when your product is not returning profit. Whenever your product is damaged in transit, or is returned by the customer for related reasons, the costs of having shipped the product still chips away at your profits. You can reduce your returns by investing in tracking tools for your shipments. Both you and the customer can have access to a real-time, reliable stream of information about the status of the shipment. Having visibility and being able to see each step of the delivery process will provide a definitive improvement in satisfaction levels. 

Optimize Your Transportation Selection

With a reactive market and shifting prices, it is in your best interest to periodically assess your transportation costs. If the conditions are right, renegotiate prices for transportation mode or routes so that you are not being overcharged. This is even something you can do in advance. Make sure to distinguish between your transport costs and landed costs in order to give you the best overview of your actual transport spending. Avoid lock-in by checking if other reliable carriers that fit your needs have lower costs, and switch over. 

Thanks for visiting ZUUM! We love making useful content for the supply chain industry. Check out our other tools and articles if you found this helpful.

Sources:

https://www.businesswire.com/news/home/20120501005093/en/New-Study-Companies-Overspent-on-Shipping-an-Average-of-13-in-2011

https://www.wsj.com/articles/companies-are-spending-more-on-shipping-and-thats-not-changing-soon-1529413500

https://www.cnbc.com/2021/02/18/online-shipping-costs-expected-to-increase-further-into-the-pandemic.html

https://www.mixmove.io/blog/5-signs-that-you-are-spending-too-much-on-delivery-costs

https://www.simplfulfillment.com/blog/youre-probably-overspending-on-shipping-lets-change-that

Disruption in the supply chain and logistics is not a new phenomena. Disruption can come from any source, and can happen on a global or local scale. Those who have been in the industry for some time may have seen a variety of events that cause disruption. In the past, these may have included natural disasters, such as hurricanes or fires. Price fluctuations in the market, issues with product, and overall transportation failures and delays typically contribute as major sources of disruption. Recently however, due to the pandemic, we have seen the biggest disruption in the supply chain industry to date, and it has greatly highlighted the industry’s need to build resilience and flexibility.

Disruptions often result in supply shortages, demand instability, and inventory difficulties. Your customers are likely just as frustrated as you, but they understand that some things are simply out of our control. Be transparent and communicative with them about what is going on with delays, and facilitate regular interaction with others who can provide information about your shipment. In addition, do what you can to help your workforce overcome the disruptions. Strong business leaders make themselves flexible and innovative in the face of difficulties. Support new ways of working and adjust your strategies as necessary. 

According to Accenture, “94% of Fortune 1000 companies are seeing supply chain disruptions from COVID-19 [and] 75% of companies have had negative or strongly negative impacts on their businesses.” To minimize your losses and continue operating efficiently, supply chain leaders have a few options at their disposal. If you want some tools and strategies to help you react to and protect your business from disruption, this article is the one for you.  

1. Plan Ahead

Because of the unpredictable nature of disruptions, the best defense comes in the form of preventative measures. Once an actual disruption affects your business, you likely won’t have too much time to organize your response, and external market factors from the disruption may limit your resources. Update your risk management strategies as needed and create an emergency plan for the future. Consider setting aside an emergency budget, and be aware of potential risks or threats. You can get a better idea of what to plan for by using predictive analytics technology. 

2. Diversify Your Supply Base

Furthermore, it is strongly encouraged to diversify your supply base and have supplier options in different areas in the event that your usual supplier is unable to provide due to the disruption. When searching out multiple supplier options, it is important to consider the consistency of quality, as well as the associated costs (e.g. fiscal). Additionally, it is recommended to plan ahead with backup suppliers – this is a less expensive option and can be achieved by entering into agreements with vetted suppliers that will come into effect in case a disruption or emergency does occur. 

3. Secure Inventory

The next thing to consider is building up inventory. A great tactic to help deal with uncertainty, begin increasing your inventory stock by buying ahead, whether the inventory are essential components or finished products. The amount of emergency inventory should be balanced with the costs of procuring and storing these items for a length of time. Whenever you tap into this extra inventory storage, create a plan to continue replenishing it so that you are not left in a vulnerable position if something else unexpected occurs. 

4. Manage Demand

This is another option to help you deal with disruption issues. Do what you can to best position your business with the resources you have. For example, a company that offers multiple products or services can temporarily “replace” the product experiencing disruption issues by offering a different product in its place. Companies can incentivize their customers during this time by introducing factors such as discounts. If that strategy is not applicable, another way to manage demand is by prioritizing your customers. Distribute your available inventory supply carefully and by identifying your most important customers. 

5. Improve Visibility

Improving visibility with a logistics control tower is one of the most helpful technologies available when dealing with disruption. Having access to end-to-end visibility for example will give you a higher degree of control over the logistics process. Using AI, data intelligence, and analysis can provide you with visibility even before a disruption impacts you. Identify trends and alerts with actionable insights generated by the technology. Other types of control towers, such as for inventory or supply assurance, are also useful tools against supply chain disruption.

We hope you enjoyed this article! Follow ZUUM’s blog and learn more about the industry every week.

Sources:

https://www.forbes.com/sites/pikeresearch/2019/08/07/advanced-technologies-are-disrupting-transport-and-logistics-business-models/?sh=7e2266463695

https://www.accenture.com/us-en/insights/consulting/coronavirus-supply-chain-disruption

https://www.pwc.com/us/en/library/covid-19/supply-chain.html

https://www.accenture.com/us-en/insights/consulting/coronavirus-supply-chain-disruption

https://www.joc.com/technology/visibility-tools-key-combating-supply-chain-disruption_20171124.html

https://www.ibm.com/topics/control-towers

For those in the logistics industry that are wanting to improve their business performance, a TMS (transportation management system) is essential to increasing your efficiency standards. Keep in mind that anyone working in supply chain management, from shippers to distributors, wholesalers, and more will find this sort of software is significantly useful in their dealings.

Making use of TMS technology may understandably seem daunting at first for those who have not yet begun digitization efforts, but the good news is that implementing a TMS into your current structure will prove to be beneficial in the long run. In the current market, the right TMS platform can assist you with streamlining decision-making and ultimately helping you make the most out of your hard work. Luckily, here at ZUUM, our experts can help you figure that out! Read on to find out what features we recommend looking for in a TMS that best addresses your management needs. 

If you want additional truckload capacity and don’t think a transportation management system is right for you, check out ZUUM’s Capacity Pro tool – get an instant freight quote with zero set up fees and receive access to ZUUM’s over 100,000 carefully vetted carriers. For shippers not in the market for a TMS, this product is all you need to increase your access to capacity.

Integrations

Firstly, it will likely be very important to you to choose a TMS that easily integrates with your current systems. You want to pick a software that can seamlessly meld with whichever internal or third-party systems that already exist within your management structure. This includes accounting and tracking software as well integrations with external load board subscriptions. By doing this,  your experience should be prompt, secure, and have an accessible user interface. 

Document Management & Billing

Secondly, you want to make sure any TMS you choose is able to handle your documentation and freight billing needs. Think about that pile of paperwork in the office, and imagine that it could all be smoothly uploaded, with software that helps you handle all the auditing and invoices you are typically processing. A good TMS will automate your back-office handlings and provide you with a majorly improved sense of organization by centralizing your document management for you and giving you notifications regarding the status of your shipment and contracts. Advanced TMS will automatically generate invoices during the trip of each shipment and updates as any unexpected costs appear.This function reduces paper waste, error probability, and unnecessary costs. 

Real-Time Visibility

Third, you should pick a TMS that offers real-time visibility features for your shipments. TMS technology has the capability of tracking your shipments down to the item level, with real-time updates and notification to alert you on item status, bid changes, and exceptions. Visibility in supply chain management is only growing more necessary with time, to both customers waiting to receive their shipments, and those in the logistics industry working to make it happen. Being able to track your shipments and receive updates from end-to-end results in higher levels of customer satisfaction, higher profits, and peace of mind towards your shipment’s expedition. 

Predictive Analytics

Fourth, you will find a lot of opportunity for utilization with a TMS that offers capable predictive analytics and business reports as a feature. you can benefit from speedy overviews of your typical freight costs and see where there is room for more profit. Data analysis can also be applied to view your load costs, truck types, and even your carbon footprint. When it comes to reducing shipment times, developing accurate KPIs, and allowing greater insight into your business, this facet of your TMS will be indispensable to you. With this technology at your disposal, you can optimize your supply chain management and create reports that reflect what your company finds of necessary interest. 

Additional Features

Lastly, while not an essential feature, customization is a key ability of a flexible TMS that can meet all of your needs. Of course, not every business requires a customized TMS platform in order to thrive with their new software. However, as your company continues to grow and your supply chain increases in complexity you may need more specific capabilities or you are interested in adding even more abilities to this multi-functional tool, this is another option to consider. 

Still not convinced that a TMS will do much for you and your business? ZUUM’s TMS products, ZUUM Enterprise and ZUUM Business report service levels consistently over 95%, with average time saving between 35-45%, and average cost savings of up to 15%. Upgrading your management system with our TMS will bring productivity gains up to 70%, and our forecast technology reaches up to 95% accuracy in its readings. Don’t believe us? Click here and find out more today.