Transport cost optimisation &
freight cost management

Transport concepts describe the strategy, the nature and the means with which transports are carried out. Often they have emerged out of practical necessity or have been defined in the course of the newly defined supply chains as part of the supply chain solution without deeper systematic planning. A lot of money can be saved with the right transport concepts. The transport concepts must be regularly adapted to the changing framework conditions and at least checked for efficiency and transport quality. Experience has shown that many questions arise here, which can also offer many optimisation options at the same time, such as:

• Regional forwarding transports versus round-trip traffic (milk runs)
• CEP versus general cargo
• Use of appropriate modes of transport (plane, container, appropriate lorry trailer, etc.)
• Optimisation of the cargo hold or the degree of transport capacity utilisation
• Optimisation of transport networks (direct transport versus transshipment in logistics hubs, minimising transport distances, use of trimodal transport concepts, etc.)
• Transport and freight cost benchmarks provide a position statement
• Regular tactical route planning to reduce the cost framework conditions for operational transport planning

ebp-consulting deals with these aspects in the course of optimising transport concepts and combines the consultants’ freight forwarding expertise with the methodological know-how of intelligent planning and evaluation tools. Based on real data, the need for action can be analysed and the use of alternative concepts can be evaluated.

Paying for exactly those transport and freight services that have been commissioned and contractually agreed should actually be standard in every company. The basis for state-of-the-art freight cost management is an overview and transparency of all freight costs, in a level of detail that allows monetary evaluations to be carried out and any potential for optimisation to be identified. All consignments and transport orders must be checked continuously and comprehensively. Certain systems and standards have to be implemented that incorporate accounting elements as well as legal and tax aspects. The digitalisation of all freight invoices is a significant step towards systematisation and checking for typical deviations and faults This is even more important when large volumes of freight invoices are involved. Identifying deviations is an initial step towards improving accounting quality with freight forwarders/transport service providers, but these must then also be communicated and clarified. Experience shows that on average between 2 and 4 per cent of freight costs can be optimised once. A compelling business case which often enables the topic of standardised freight cost auditing in the company to also be permanently established. ebp-consulting and its partner supply chain factory provide support with this and rely on proven methods, such as the ‘Freight Invoice Audit & Payment Service’. Freight service purchasing as a strategic element

Experience has shown that regularly checking freight services and using benchmarks as a comparison is highly recommended. If a new tender on the transport market appears to make sense, cost savings of up to 10% can be achieved – in normal times. However, sustainability is more important here compared to the fast euro, which could possibly be saved to an even greater extent in the short term. The bases for goal-oriented tender management are, on the one hand, the improvement of the tender framework conditions, such as by optimising transport concepts/processes, and, on the other hand, the standardisation of freight conditions to ensure the comparability of the tender results as well as the transparency of the accounting modalities. Freight service purchasing makes strategic sense, particularly when attractive volume discounts can be obtained from the service providers in the future through bundling and consolidation effects instead of the previously very decentralised commissioning of transport service providers. From a historically grown variety of transport service providers that were previously active for a company, the transports can be consolidated at more favourable freight conditions to considerably fewer, mostly regionally strong service providers. ebp-consulting helps companies to recognise the potentials of freight service purchasing and subsequently to implement them in the framework conditions to be defined.