By: Frank McGuigan, Chief Executive Officer, Transplace

Yesterday, Transplace was thrilled to announce that it acquired Yusen Logistics Americas’ intermodal marketing company/over-the-road freight brokerage group. A subsidiary of Nippon Yusen Kaisha, Yusen Logistics is a global logistics and transportation provider that established a strong, successful North American intermodal business. This acquisition expands Transplace’s intermodal and freight brokerage capabilities and better positions us to meet the supply chain needs of our customers.

Expanding Our Intermodal Footprint & Capabilities

In today’s challenging marketplace, with fluctuating capacity and rising freight costs, more and more shippers are making intermodal a key component of their transportation operations. Transplace is committed to best positioning itself to provide our customers with flexible, reliable and secure intermodal solutions. And acquiring Yusen’s North American intermodal operations will allow our customers to better take advantages of this highly effective and efficient mode of transportation.

Yusen strengthens our current position in the intermodal market, drives more effective equipment utilization and increases our already deep pool of dray providers. The overall Transplace shipping community will benefit from network synergy with our current intermodal and over-the-road footprint, resulting in better opportunities for more effective execution of their intermodal shipments and mode conversion.

Another significant benefit of the acquisition is the group of experienced, talented logistics professionals that have joined the Transplace family. Yusen’s intermodal team will operate as part of our intermodal business unit – Celtic Intermodal – which is led by President Doug Punzel.

Transplace’s Strategic Approach to Acquisitions

The acquisition supports Transplace’s strategy of complementing strong organic growth with selective, strategic acquisitions. As with all of our acquisitions, it’s important to Transplace to find companies that are a great fit – both in their capabilities, geography and culture. Yusen established a strong presence in the industry along with a superb customer base, and brings a customer-centric culture that complements Transplace’s business and mission.

The addition of Yusen’s intermodal business enables us to better serve our existing customers as well as serve a new set of customers. Transplace is committed to providing exceptional transportation management services and technology, exceeding expectations and building long-term, strategic relationships with these new customers.

Do you have questions about the acquisition?

The post Letter from the CEO: Transplace’s Acquisition of Yusen Logistics’ Intermodal Operations appeared first on Uber Freight.

By: Frank McGuigan, Chief Executive Officer, Transplace

As many of you may already know, we recently announced that Tom Sanderson has transitioned to the role of executive chairman and will serve on Transplace’s board of directors, and that I have moved into the role of CEO. I am honored and excited to have the opportunity to continue as a leader of our company and build upon the rich heritage that has made Transplace a dominating player in transportation management and 3PL services.

Having had the opportunity to lead Transplace’s North American sales and operations for the last several years, along with the opportunity to work alongside Tom, this is a natural transition for us as a company. I want you to be confident that throughout this change, no matter what, our mission and core values will continue to be the standard in which we will all strive.

Over the past eight years, Transplace has experienced record growth and made significant investments in its people and technology. We’ve also expanded our geographic presence in the U.S., Mexico and Canada – allowing us to better provide exceptional logistics and trade compliance services to our growing customer base throughout North America. These investments and our ongoing commitment to supply chain excellence will enable us to deliver even greater value to our customers.

This legacy of success has as much to do with the dedicated people handling day-to-day operations, in all functions across North America, as it does the executive team. We are where we are as a company, because of our outstanding people and their commitment to providing outstanding service to our customers every single day. Our customers can rest easy knowing that the people who truly make Transplace what it is are all still in place and will continue to deliver the exceptional service that they have come to expect.

Ongoing, we will work together as one Transplace and as a cohesive, purposeful team, with an extreme focus on our customers, our people and our shareholders. We will challenge ourselves to improve in all facets of our business through metrics, measurements and our continuous improvement tools, so that we can add value each and every day to both our business and that of our customers. We will strive to anticipate and act upon problems before they happen, leveraging the collective information and expertise across the entire enterprise for a truly differentiated customer experience.

I am excited and honored to further support our mission to thrill our customers, and the entire Transplace team will continue to work toward delivering innovative logistics solutions and outstanding service today and into the future.

The post Letter from the CEO: Executive Team Changes, Future Success and Putting the Customer First appeared first on Uber Freight.

Within the last few years, less-than-truckload (LTL) rates and capacity have fluctuated. Many carriers have shifted from the traditional National Motor Freight Classification (NMFC) rate-setting formula to density-based pricing, which prices freight according to the amount of space the shipment uses in the truck. This new pricing model, along with other recent industry trends, has had a significant impact on shippers – making it important to understand the new pricing methods for LTL shipments, what’s currently happening in the LTL industry, and some of its key market challenges.

Current LTL Pricing Methods

According to The National Freight Traffic Association, the NMFC is a “standard that provides a comparison of commodities moving in interstate, intrastate and foreign commerce, similar in concept to the groupings or grading systems that serve many other industries.” Using this model, commodities are grouped into 18 freight classes—from a low of class 50 to a high of class 500—based on an evaluation of these characteristics:

• Density
• Handling
• Stowability
• Liability

More recently, the LTL industry has incorporated density-based pricing, which considers the actual weight of a particular item, classifies it and determines how much volume it will take up in a trailer. The first step many carriers have taken is introducing “Dimensioners” into their network to efficiently capture the density of each shipment as it travels through their network. This helps the carrier better understand the actual cost incurred for each shipment in order to more accurately price each account.  This method is comparable to how large parcel shipping companies such as UPS and FedEx determine their costs to ship products.

Challenges within the LTL Market

So, what does this mean for shippers? With more and more carriers adopting density-based pricing, new challenges have appeared for shippers who have lightweight shipments or bulky items that take up a lot of trailer space. And with the new pricing model, LTL carriers are requiring shippers to pay additional fees and are increasing the pressure to accurately measure shipments.

Some other challenges currently being faced by shippers in the LTL market include:

• The LTL industry is trending overall toward more frequent, smaller volume shipments. This is exacerbated by the “Amazon Effect”, as there is a greater number of smaller volume packages—instead of fewer bulkier packages—that are expected to be shipped within one or two days.
• Capacity has tightened significantly since May of 2017 across all equipment types. And with more frequent deliveries with more volume, many LTL carriers are having trouble covering all of these shipments.
• Recent natural disasters have made these LTL market challenges all the more difficult for shippers to overcome. Hurricanes Harvey and Irma as well as earthquakes in Mexico have caused additional delays in shipments and pulled further capacity out of the network.

One industry that is seeing the brunt of many of these LTL shipping challenges is the chemical space. During the winter months (November to May)—especially in the Midwest—many customers ship water-based products that freeze at 32 degrees. And as it currently stands, the LTL reefer market is very saturated, and with capacity already more limited, these chemical shipments have had trouble being filled.

LTL Shipping Solutions

One potential solution for LTL shipments is to co-load with other shippers, as consolidating in a multi-shipment environment can truly bring a number of benefits in this particular market. Uber Freight’s OptiPro program provides an optimization opportunity for shippers with under-utilized capacity through a multi-faceted collaboration network. Through this collaborative approach, multiple customers who are shipping products to the same region can build dynamic multi-stop truckloads. And a great shipper match results in:

• Transportation cost savings
• Reduced working capital
• Inventory improvement
• Greater order fill rates
• More frequent deliveries
• Increased flexibility to support customers

Collaboration has long been a focus in the transportation industry, but its realization has been a challenge because of the manual processes and lack of scalability. Uber Freight continues to strive toward creating an environment in which we are looking load by load across our whole customer network to see exactly where and how we can save our customers time, capacity time and money.

To learn more about Uber Freight’s OptiPro program with Managed Transportation, connect with an expert.  To learn more about Uber Freight’s Shipper Platform LTL freight shipping services capabilities, connect with a LTL sale team at ltl-sales@uber.com or sign up today for an instant LTL quote.

Check out Uber Freight’s density calculator to calculate freight density, estimate NMFC freight class, and optimize LTL shipping costs.

The post LTL Trends and Challenges: Density-Based Pricing appeared first on Uber Freight.

However, data management does not come without challenges.  In the realm of supply chain data management, there are a few common issues that seem to transcend industries, business models, or network scopes. These include:

1. Lack of necessary resources allocated to technology and people
2. Lack of appropriate and adequate systems
3. Lack of coordination between varied network technology systems

Lack of Necessary Technology and People

Many organizations lack the technology and people that good data management requires. Organizations that internalize the technology they use tend to be environments that are restrictive on an organization’s ability to adapt to evolving data management capabilities, or to ensure the sustainability of their systems as their organization grows.

Organizations can often come to rely on a scenario in which a handful of people within the organization have the continued functionality of their organization’s systems resting on their shoulders. Their responsibilities could range from data input, coding, and problem-solving to an almost exclusive understanding of the legacy system and how it operates. This can become a real obstacle for any growth or optimization efforts, and it is also a huge risk for the organization.

Lack of Appropriate and Adequate Systems

Software and systems deficiencies that hinder an organization’s ability to correctly understand its supply chain activity usually fall into one of two categories.

1. Legacy systems, usually on premises, that are designed around a specific network/operating model that has since changed
2. Manual processes for functions that have yet to be automated (freight tendering, FA&P)

Lack of Coordination Between Network Technology Systems

Whether it is due to acquisition or the inconsistent deployment of technologies across an enterprise, it is not uncommon for an organization to have disparate systems managing similar functions in different parts of the organization. Unfortunately, this disparity is a significant obstacle to leveraging scale and planning supply chain activity, while considering the broader organization. Lack of resources and technology know-how exacerbate this problem.

As supply chains become more complex and the role of data becomes more important than ever, proper data management is no longer a “nice-to-have” — it’s a requirement. Building data management skills begins with an honest assessment of where your organization’s strengths and weaknesses lie, and where the gaps exist that prevent you from thinking about your supply chain strategically.

Where does your organization need to focus its attention to take your data management to the next level?

The post Data Management Challenges and Solutions for the Modern Organization appeared first on Uber Freight.

The “3-legged stool” of transportation network optimization considers all three core elements of a successful transportation network: price, capacity and service. Pulling out one or more legs of the stool makes the network unstable. During this year’s Shipper Symposium, our Transportation Network Optimization session showcased how Transplace’s Supply Chain Consulting Practice (TSCC) helped a global producer of wood products strategically overhaul and optimize its North American network of transportation capacity, service and spend. Below is a look at that case study and the great results that the process yielded.

Manufacturer Takes Transportation Management to the Next Level

The wood product manufacturer recently partnered with Transplace, with the objective of building a more strategic approach to sourcing transportation capacity and managing their core carrier base. The joint project team executed a Strategic Transportation Optimization (STO) project, which included:

• Creating a freight spend baseline
• Developing a comprehensive capacity sourcing RFP
• Executing a multi-round sourcing event
• Building a set of business rules and constraints
• Designing and producing a comprehensive set of alternative scenarios to test for optimal outcome
• Producing an optimized routing strategy that could be operationalized
• Generating more than $5M in annual savings

With a more centralized methodology for its transportation management as the desired outcome, the manufacturer wanted to take a more strategic approach to centralized and standardized sourcing.

Executing a Network-Wide RFP and Building a Baseline

Prior to this project, the manufacturer’s operations had been localized, using minimally structured routing guides or auto-tendering. Restructuring and optimizing its operations required planning and executing the company’s first-ever network-wide RFP – with a carrier base made up largely of regional owner-operators having little experience with technology-enabled sourcing systems.

It was also critical to build a strategic plan and establish the first company-wide freight spend baseline, which would allow for the optimization of the manufacturer’s routing strategy to achieve its internal goal of $5M in freight cost reduction. And because shipment transaction data was stored across three legacy systems, more than 75,000 shipment records needed to be consolidated, cleansed and validated to ensure the data was accurate and usable.

In addition to establishing this freight spend baseline, TSCC needed to understand how the manufacturer operated. This was achieved by conducting on-site discovery with the company’s regional transportation managers and dispatching staff to get a firsthand look at its transportation operations.

Because most of the manufacturer’s carrier base had limited experience with technology-enabled sourcing or RFPs, this process was extended to the incumbent carrier base as well. Several extensive, hands-on training and briefing sessions with carrier stakeholders helped communicate how this new approach would enable optimization of the manufacturer’s network as well as theirs – and guaranteed carrier compliance with RFP requirements. This not only helped carriers navigate the process, but ensured that the manufacturer would be partnered with the right carriers, the right service and the right capacity – all at the right price.

After evaluating RFP responses and conducting negotiations, Transplace worked with the manufacturer to create an optimized network strategy, covering high-level planning, as well as carrier routing at the lane-level. Transplace also managed the communications and implementation of the awarding strategy as well as the assembly of a routing guide.

The 3-Legged Stool Yields Impressive Results

Establishing a strategic, technology-based approach to sourcing has led to significant operational improvements, as well as cost savings for the manufacturer. As a result of this project, the manufacturer:

• Gained greater visibility into freight flows and spend – By consolidating and validating shipment level data from across its three ERP systems, the manufacturer – and its carrier partners – gained visibility into their transportation network by facility, lane, region and mode. This not only enabled the manufacturer to achieve centralization, it also provided the incumbent carriers with the ability to shift their capacities and offer improved service going forward.
• Developed an optimized routing strategy – Executing a technology-enabled, network-wide RFP and iterative scenario analysis, enabled the manufacturer to create a centralized optimal routing strategy.
• Reduced carrier base by 61% – By optimizing its carrier selection, the manufacturer reduced is carrier base from 270 to 105 carriers. The manufacturer benefitted from strengthening their incumbent carrier relationships by empowering the network sustainability of all parties involved.

Large-scale, complex, network-based projects, such as this case, will identify value in the network. They will present the opportunity to both save money and improve service to customers. But identifying value is only the first chapter of the story. The next chapter, implementation, is where the rubber meets the road and the value identified is turned into the value realized.

Far too often implementation is not well-planned or well-executed, with benefits and compliance not being tracked and performance KPIs and metrics not being monitored or measured. The inevitable result is a shortfall in benefits versus what could have been achieved with proper planning, tools and execution.

Through this project, the manufacturer also gained access to network data and a blueprint for the optimized sourcing process that will be the foundation for the next time a similar project is undertaken. This, then, becomes the launch-point for a continuous improvement process that will continue driving benefits well into the future.

How is the “3-legged stool” impacting your business operations?

The post Transportation Network Optimization: The 3-Legged Stool appeared first on Uber Freight.