On average, transport costs weigh upon the costs of the physical distribution (transports, stock, warehouse, administration of the distribution)
for about half of the total amount; obviously, significant differences compared to average can be noticed in relation to the considered sector, given that
each one is characterized by the specific physical and economic nature of products (value-density) and the market service needs.
Very often companies tackle the problem of transport cost reduction mainly acting on the competitiveness they may generate among the operators of the sector;
actually, a wider approach is needed in order to involve the organization and planning aspects of the activities, define the most interesting rates, easily
select the most convenient operators for a given delivery/destination, determine and manage a suitable set of cost and performance indicators (only measuring
we can improve).
It may often happen to neglect opportunities coming from aspects linked to transport such as the nature and type of packaging or Shipping Units and the
upstream and downstream co-operation with suppliers and customers.
Simco gives its support to improve performances and reduce transport costs taking care of:
- Analyzing traffic flows, redefining routes and delivery paths using advanced mathematical algorithms developed using specific optimization software tools;
- Determining the vehicle saturation levels and defining the best loading procedures;
- Assessing the convenience of "make or buy" choices within the transportation management, selecting the operators of the sector and giving support to the tender;
- Analyzing and evaluating existing contracts and determining the best rate structure and contractual model also according to updated law revisions;
- Designing and installing logistic instrument panels to control the transport KPIs using Business Intelligence techniques;
- Training and supporting the involved distribution Human Resources by defining their role and duties within a wider frame of streamlined organization aimed at obtaining higher levels of efficacy and efficiency
Definition of the best network
- Analysis of the present situation concerning transports. We start by analytically gathering all costs (inner and outer) linked to transports and the activities strictly related to them.
- We analyze the origin and destination of transports and calculate the reference parameter for the convenience calculations (€/kgkm, €/mckm, other specific).
- We evaluate the present service level and the expectations of both the company and the customers.
Strategical, technological and organizational options are defined to eliminate weak points and achieve excellence levels. Alternative solutions are analyzed (even using complex information tools) and widely described in terms of attainable results, budget, return on investment, operating costs, operational flexibility, completion times and risks.
The actions aimed at achieving and consolidating the improvements determined during the previous phases are developed together with the priorities and the scheduling; the Work Group is started, organized and supported.
Monitoring of results
Periodic assessment of the transport situation through auditing techniques.