Aardvark Supply Chain Solutions - Carrier Cost Management and Optimization Services for Freight and...

8/6/2019 Aardvark Supply Chain Solutions - Carrier Cost Management and Optimization Services for Freight and Parcel Shipp…

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Carrier Cost Management and Optimization Services for Parcel and Freight Shippers

Executive Summary Managers across all industries share a unique responsibility to maximize efficiency andreduce cost for their organizations. While increasing labor, material, administrative andtransportation costs are making corporate goals and objectives exceedingly moredifficult to achieve, companies continue to look for creative solutions that will benefittheir bottom lines without sacrificing service to their customers.

According to Armstrong and Associates, the outsourced transportation market is a 127billion dollar industry growing at 12% CAGR annually. As more companies continue torealize the benefits of transportation management, from LTL and truckload tocomprehensive small parcel spend, they will be able to focus on their corecompetencies and achieving their goals.

Aardvark understands these challenges and continues to develop new and innovativesupply chain solutions for our customers.

About Aardvark

Founded in 2009, Aardvark is a transportation management and consulting firmheadquartered in Chicago, Illinois specializing in global carrier network optimizationand supply chain management.

Offering an extensive carrier network and using current customer processes,Aardvark’s team of industry experts can design and implement a customized solutionthat meets the specific organizational needs and industry requirements of each

individual customer.

Providing both the framework and support necessary to implement sustainable carriermanagement and cost reduction initiatives, companies of any size can now realize thesignificant savings and benefits associated with continuous process improvement andsupply chain optimization.

1For more information visit www.ardvk.com



he Common Challenges

1. Sourcing – Large customers drive market pricing. Most companies lack visibility into current industrybenchmarks, carrier capacity and competitive rates.

2. Line Item Shipment Data – Shippers have limited access to carrier data and it is typically in a marginallyusable format.

3. Invoice Audit and Contract Compliance – Customers with few available resources cannot effectivelyperform shipment level audits on carrier invoices to insure contract compliance and billing accuracy.

4. Reporting – Limited data and resources lead to reduced reporting capability on KPI’s and importantmetrics.

5. Analysis – Compiling incomplete data through manual processes gives organizations little insight or value.

ur Value Proposition

Negotiation o Annual review of hundreds of

carrier agreementso Access to current market pricing

data for significant cost savingso Benchmarking provides an

accurate baseline assessment fordetermining strategy and savings

Shipment Level Audit o Revenue recovery for service

failures on guaranteed shipmentso Minimizes accessorial risko Discount validation, contract

compliance, accurate invoicingo KPI scorecard items include

Detailed Summary, Lane and CostAnalysis, Shipment Accessorialand Surcharge Cost Reporting

Technologyo EDI shipment line item integrationo Centralization of data and

enhanced shipment visibilityo Standard reports providedo Network optimization, expert

analysis and recommendations

rogram Benefits and Cost Savings

Sourcing – Sustainable double digit annual savings for customers, averaging more than 12.5% in 2010 Contract Compliance, Shipment Level Audit and Revenue Recovery – Customers historically save an

additional 2-4% from a combination of rate improvement (1-2%) and contract compliance (1-3%) Data Analysis and Lane Optimization – Long-term collaboration with customers on process enhancement

and operational implementations that will continue to drive significant, long-term savings




Continuous Process Improvement The Aardvark continuous improvement concept is a closed-loop process model. Thissimple, effective template allows our customers to create efficiencies around theirtransportation management function through process improvements and enhancedsupply chain visibility.

Our model is also flexible and designed to support any sized organization and mode oftransportation. Using the template above, our team will develop a complete andcustomizable solution that is specific to individual business needs and/or industryrequirements.

Common inefficiencies often lead to significant limitations and costly manual business

processes. Understanding the current challenges faced by most shippers, our team hastaken a systemic approach to identify specific customer needs and has developed acustomizable process improvement concept that is unique to our industry.




Benchmarking Lack of visibility into carrier pricing structures is one of many problems customers faceduring any carrier negotiation. Without a baseline of general market pricing data, mostcustomers are at a huge disadvantage when negotiating directly with companies likeUPS and FedEx.

Benchmarking current customer agreements against different companies sharing similarsize, common industry, geography and shipment profile is the first critical step in thisprocess. Historical data gives our team insight into current market conditions and allowsour customers the best opportunity to maximize their carrier discounts and increase theiroverall savings.

We maintain a very large working database of carrier pricing information that is indexedaccording to the numerous common variables associated with cost and profitability.Items such as customer size, industry and average shipment characteristics are all majorcomponents of our analysis as are many other, more complex variables used in everycarrier costing model and included in most agreements.

Every customer solution requires creating a complete and accurate baseline assessmentof all relevant customer data and enough market intelligence to execute a successfulcarrier management strategy and negotiation.

Negotiation Pricing agreements are robust and complex. Carriers take special care craftingagreements that appear advantageous to customers, but often include elements that canbe punitive. The complexities of these agreements often prevent customers fromcreating quality processes around their business needs because of the amount of timeand knowledge required to effectively manage a pricing agreement.

Understanding current carrier methodology allows our team to navigate the “nooks andcrannies” of any proposal, ensuring that the discounts and concessions offered arebeneficial to the customer and their company’s bottom line. We provide every customerwith a complete overview of the various costing and pricing strategies employed by

carriers. This information will increase customer confidence in the process and helpensure the best possible outcome.

A successful carrier negotiation can be accomplished in several different ways. Somecustomers want to be the main point of contact and have Aardvark work as a consultantand advisor. Others may prefer to have us work directly with the carriers on their behalf.Depending on the situation and relationship, we will find a customized solution that bestmeets the needs of their business.




While Aardvark remains unbiased in our analysis, our customers often have a preferenceto a current carrier relationship. Depending on the situation, our team will secure anaudience and negotiate with the incumbent carrier exclusively so savings can beachieved through a single bid process. If the outcome is insufficient, an RFP is initiatedand additional proposals are accepted. In either case, over 90% of our engagementsresult in both achieving our goal of providing significant savings to the customer andremaining with their current carrier.

Program Management and Contract Compliance Complicated carrier agreements include rolling averages, revenue tiers, base discountstructures and other contract terms that make invoices confusing and internal audits timeconsuming. Dozens of miscellaneous or “Accessorial” charges are difficult to recoup andcan easily increase overall shipment costs by as much as 40%!

Once a carrier is chosen, customers will continue to work with our team to implementongoing contract compliance, billing accuracy and revenue recovery programs withoperational support for ongoing process efficiency and optimization.

Aardvark also offers web-based reporting options that include tracking and ratevalidation tools. These tools allow customers to review their shipment level detail,miscellaneous charges, billing credits and corrections and the actual on-timeperformance of their carriers.

Our solutions provide each customer with complete shipment level insight and enhancedvisibility into their transportation supply chain. Customizable tools and robusttechnology will create management and compliance reports based on customer needsand requirements.




Optimization Services Technology automates your contract compliance and our robust reporting tool willanalyze your needs based on specific metrics and economic conditions. Offeringcustomer access to current and relevant market intelligence, our team will makerecommendations on optimization by providing an ongoing program of consultation andexpert analysis. Our services include: Analyzing alternate modes and services,customized weight and zone analysis, accessorial analysis and any cost savingsopportunity available by aggregating, bundling and renegotiating.

Business reviews are scheduled quarterly as an integral part of the Aardvark partnership.

Aimed at interpreting customer data and identifying any opportunities for spendreduction, service enhancement and supply chain optimization, we will continue creatingnew benchmark data as market conditions and shipment characteristics change. As aresult of process enhancement, network optimization and establishing key performanceindicators, we guarantee continuous improvements in service quality and cost savingsthroughout the entire term of each customer program and partnership agreement.


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