Monday, February 6, 2017

4 Ways How Companies Benefit From A Transportation Optimization Software

By Douglas Wright

Food and beverage companies, and as well as those that are providing other types of goods have been using the transportation services. And since the technologies are now being developed, a new software is being produced for helping these businesses make easier and faster transactions. But with all of these advantages, there are still some businesses who are hard to be convinced in using these new tools.

A cloud computing model is one of the most common ways being used nowadays. This offers a big advantage of removing all the obstacles that companies are commonly facing with the traditional models. But now, they already have an access to high performance transportation optimization software which is an integral part for the execution and planning processes. The following areas in companies are made with improvements.

Private fleet and carrier selection. The logistics providers and the shippers have been using 2 different process and these are used with acquired assets. First is to maximize on using private fleets and also fuel costs and total distance. And second is choosing those common carriers by identifying the lowest rates in each of the lane.

The companies now can simultaneously optimize the networks for both the common carrier capacity and private fleet. The optimization is not just a one time event. Selecting between carriers and private fleet maybe done basing dynamically on fuel, capacity, and other costs. Some what if thoughts cannot be avoided and simulating these can be done anytime for determining how the network is affected by some changes.

Consolidating inbound and outbound processes. To optimize both of these processes simultaneously with additional opportunities in order to minimize the deadhead and to leverage the back hauls will make the return of investment or ROI more attractive. A tremendous value may also be added with the direct to store type of delivery model. To plan and to execute shipments and as well as to maintain a higher service level can make some differences with the medium and small sized businesses.

One to many connection. Optimizing a transportation is not only for single enterprises. Inherent advantages have been arising due to the use of cloud based platforms in letting trading partners exchange their information. There are a lot of shippers and also logistics are using this platform, thus, there is also an increase of carriers having an interaction with shippers and providers.

And for this reason, the on boarding new partners including suppliers, 3PLs, carriers, freight forwarders, banks, etc. Become more efficient and faster. It is because the connections exist already through the one to many approach. For sectors which involve the need for carriers to have specialized refrigeration equipment, leveraging carrier communities having industry specific expertise can add value.

Sustainability. Food and beverage industries considered sustainability as major point for selling. Through this, reducing the carbon print is possible. To document the results is an advantage as well with using optimization tools.

The most common approach being used is a carbon tax as the accessorial charge. Optimization engines are considering this with some other variables to minimize transportation costs. Distinct factors is another approach through modes of transit like air, ocean, rail, LTL, etc.

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