“AN INDUSTRY PERSPECTIVE”

MANAGING FREIGHT VOLUMES

IN THE ONLINE RETAIL SPACE

PRESENTED BY KERRY HOLMES

GENERAL MANAGER

INTERACTIVE FREIGHT SYSTEMS (IFS)

WHO IS IFS?1. WE ARE AUSTRALIAN – WELL MOST OF US

2. 15 YEARS YOUNG – NOT ALL OF US

3. DESIGN, DEVELOP AND MARKET ITS OWN MULTI-CARRIER TRANSPORT MANAGEMENT SOFTWARE

4. IN 10 COUNTRIES

5. WELL OVER 2,000 CUSTOMERS WORLDWIDE

6. 58 DEDICATED PEOPLE WORLDWIDE

7. OVER 600 CARRIER PARTNERS WORLDWIDE

8. PROCESS OVER AU$0.5B OF FREIGHT SPEND P.A.

9. DOZENS OF OUT-OF-THE-BOX ERP/WMS INTERFACES

10. STRONG GLOBAL ONLINE RETAIL PRESENCE

IFS RELATIONSHIP WITH ONLINE RETAIL1. AT AN ORDER LEVEL - ACCURATELY PRICE FREIGHT

COST FROM RETAILER’S WEB SITE

a. PROVIDE PURCHASER WITH CHOICE OF SPEED/SERVICE/COST

2. ELECTRONICALLY INTERFACE TO WEB SITE/ERP SYSTEMS

3. ROUTE OPTIMISE (BY COST OR SERVICE) ALL ORDERS, SHIP THEM WITH NOMINATED CARRIERS PROVIDE MULTI-CARRIER ORDER TRACKING VISIBILITY

4. EXTENSIVE FREIGHT COST REPORTING

TALKING ABOUT…..

WHAT’S THE MARKET DOING?1. “IN THE YEAR TO SEPTEMBER 2013, AUSTRALIA’S

ONLINE RETAIL SPENDING TOTALLED $14.3

BILLION. THIS AMOUNT IS EQUIVALENT TO 6.3%

OF THE TRADITIONAL BRICKS & MORTAR RETAIL

SECTOR (EXCLUDING CAFÉS, RESTAURANTS AND

TAKEAWAY FOOD TO CREATE A LIKE-FOR-LIKE

COMPARISON) IN THE TWELVE MONTHS TO

AUGUST 2013.” – Source NAB, October 2013

IFS OBSERVATIONS (1) 1. MANY RETAILERS WANT AN ONLINE PRESENCE

BUT ARE NOT SURE HOW/WHERE TO GET STARTED

a. PLENTY OF PEOPLE IN THIS ROOM TO HELP THIS GROUP

2. MANY RETAILERS ALREADY HAVE A WEB PRESENCE BUT LACK:

a. ADEQUATE TECHNOLOGY SYSTEMS

b. LOGISTICAL EXPERTISE – OUTBOUND AND RETURN LOGISTICS

c. TOO MUCH/NOT ENOUGH CHOICE OF CARRIERS/SERVICES

IFS OBSERVATIONS (2) 3. CARRIER PARTNERS NOT ON BOARD ?

a. WRONG CARRIER TYPE/SERVICES?

b. CARRIERS ARE NOT MIND READERS – CLEARLY

EXPLAIN WHAT YOU WANT/NEED

c. CARRIER OVER-PROMISING

4. SEMI-AUTOMATED FREIGHT COSTING IS A RISK:

a. OFTEN CROSS SUBSIDISED

b. OR A CALCULATED GUESS

c. OR NOT REVIEWED REGULARLY

IFS OBSERVATIONS (3) 5. CONSIGNMENT VISIBILITY

a. RECEIVERS WANT TRANSPARENCY AS TO

WHEREABOUTS OF THEIR ORDER

b. RETAILERS WANT CARRIER PERFORMANCE

REPORTING OF THE ORDERS THEY SHIP

a. DIFOT (DELIVERED IN FULL & ON TIME)

6. RETURN LOGISTICS:

a. HOW TO GET FAULTY/DAMAGED GOODS

BACK

SHIPPING DOMESTIC VERSUS INTERNATIONAL

THE CHALLENGES FACED BY INTERNATIONAL

SHIPPERS ARE SIMILAR IN NATURE TO

DOMESTIC SHIPPERS;

WITH SOME REGULATORY VARIANCES

THE CHALLENGE SUMMARY

1. HOW DO I GET ONLINE?

2. LACK LOGISTICS KNOWLEDGE

3. LACK OF IT SYSTEMS AND OR INTEGRATION

THEREOF

4. WHICH CARRIERS & WHICH SERVICES?

5. AVOID GUESSING FREIGHT COSTS

6. CONSIGNMENT TRACKING VISIBILITY

7. RETURN LOGISTICS

8. FINANCIAL REPORTING

SOLUTION IDEAS (1) HOW TO GET ONLINE?

1. SEEK ADVICE / TALK TO ONLINE RETAILERS WHERE

THERE IS NO CONFLICT OF INTEREST

2. SEEK PROFESSIONAL ADVICE ON YOUR WEB SITE

DESIGN AND OTHER CHANNELS

a. IMPROVING YOUR SEARCH RANKINGS (SEO)

3. DOCUMENT YOUR DESIRED ROADMAP INTO ONLINE

RETAILING

4. MONITOR AND AMEND YOUR ROADMAP AS YOU GO

SOLUTION IDEAS (2) WHERE DO I GET A LOGISTICS KNOWLEDGE

BASE FROM?

1. YOUR CUSTOMERS

2. SEEK ADVICE / TALK TO OTHER ONLINE RETAILERS

3. YOUR CARRIER PARTNERS

4. FREIGHT CONSULTANTS

5. CLEARLY UNDERSTAND & DOCUMENT WHAT LEVEL OF

SERVICE WILL BE ON OFFER – AMEND THE NEEDS AS

THEY BECOME CLEARER

SOLUTION IDEAS (3) IT SYSTEMS

1. A “SMART” WEB SITE

2. WEB SERVER/HARDWARE – UP TIME IS EVERYTHING !

3. SCALABLE BILLING SYSTEM

4. TRANSPORT MANAGEMENT SOFTWARE

5. INTEGRATE WHERE POSSIBLE - AUTOMATE

6. STAFF OR CONTRACTORS TO SUPPORT ALL IT

PLATFORMS AS NECESSARY

SOLUTION IDEAS (4) WHICH CARRIERS ?

1. WHO DO YOUR COMPETITORS USE?

2. SLOW OR FAST VERSUS CHEAP & EXPENSIVE

3. FREIGHT CONSULTANTS

4. ELECTRONIC OR MANUAL CARRIER PARTNERS?

a. WHAT’S THE DIFFERENCE?

5. TRANSPORT MANAGEMENT SOFTWARE COMPLIANT

6. 3PL OR 4PL ENVIRONMENTS ?

SOLUTION IDEAS (5) PRICING FREIGHT

1. TRANSPORT MANAGEMENT SOFTWARE

a. A MUST HAVE ITEM - WHAT CAN I SAY

2. NO SPREADSHEETS

3. AVOID CROSS SUBSIDISING

4. CONSIDER WAREHOUSING/PICK & PACK COSTS

SOLUTION IDEAS (SUX) CONSIGNMENT TRACKING

1. ELECTRONIC TRACKING FROM YOUR CARRIER/S OR

NONE AT ALL

a. PAPERLESS ENVIRONMENT

2. INTERNAL STAFF VERSUS CUSTOMER NEEDS

a. IS THERE A DIFFERENCE?

3. TRANSPORT MANAGEMENT SOFTWARE

a. MULTI-CARRIER TRACKING PORTAL

SOLUTION IDEAS (7) RETURN LOGISTICS

1. YOUR CARRIERS - CAN OR CANNOT DO?

2. ERP/BILLING SYSTEM – HOW/CAN IT HANDLE

RETURNS ?

3. KEEP IT AS PAPERLESS AS POSSIBLE

4. RECIPROCAL FREIGHT RATES

5. TRANSPORT MANAGEMENT SOFTWARE

SOLUTION IDEAS (8) FREIGHT COSTS - FINANCIAL REPORTING

1. YOUR CARRIERS – SEND YOU AN INVOICE

a. HOW DO YOU RECONCILE IT?

b. DO YOU HAVE THE ADMIN RESOURCES TO DO

THIS MANUALLY?

c. HOW WILL STAFF DETECT THERE IS AN ERROR IN

THE CARRIER BILLING?

d. WHAT DO YOU/THEY DO WITH SUCH ERRORS?

2. RECIPROCAL FREIGHT RATES

3. TRANSPORT MANAGEMENT SOFTWARE

IN CLOSING1. IT IS YOUR FRIEND - IF YOU LET IT BE

2. CARRIERS ARE TOO - SO LONG AS THEY CLEARLY

UNDERSTAND YOUR EXPECTATIONS

3. LET YOUR DISTRIBUTION PROCESSES COMPLEMENT

THE PRODUCTS YOU ARE SELLING – NOT THE OTHER

WAY AROUND

4. DO NOT BE SCARED TO SHIP INTERNATIONALLY – IT

IS NOT AS HARD AS YOU MAY THINK

5. ENJOY THE REST OF THE ONLINE RETAIL LOGISTICS

PRESENTATIONS

THANK YOU FOR YOUR TIME