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Quantifying Supply Chain Costs

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Recently, freight markets have been undergoing rapid changes, and this has meant traditional methods of quantifying freight and transportation costs may not work as effectively. The market is no longer affected by predictable changes, such as the rising costs of fuel. Instead, the rate per pound and per mile may no longer work with the electronic logging device mandate, extreme weather and the continuing driver shortage, among other factors, are impacting the process of quantifying supply chain costs.

Even more, changes are coming, as autonomous trucks may upend the market in the future. Supply chain decision-makers need to establish robust communication with customers by identifying trends and carefully using logistics solutions, as well as effective analysis and data-gathering processes.

Considerations in Freight and Supply Chain Cost Quantification

To identify viable solutions for your company, you need a holistic approach to supply chain solutions and data engineering. You may need to consider freight expense information, customer order patterns, and more to determine the best path forward to improve your supply chain and your customer’s experience.

Identifying your customer’s needs will assist in determining what technologies will drive process improvement and visibility of your supply chain. Flexibility in the supply chain allows you to optimize your shipment routings with routing and mode optimization. Depending on your needs, creating flexible supply chain systems that determine optimal routing via less-than-truckload (LTL) or truckload, can also consider regional distribution models as one example. An LTL logistics company or service provider, such as Rockfarm Supply Chain Solutions, leverages their supply chain technology providing a low cost of entry and immediate ROI for shippers.

Three Mission-Critical Factors

Analyzing your systems to enhance your efficiency must start with these principles:

  1. Your approach to quantifying supply chain costs must be holistic. Every stage of the process, from order processing to shipping, can impact the effectiveness of freight and transport. There is no point in retaining the services of an LTL shipping logistics company to improve efficiency if your order systems encourage you to ship by LTL when the truckload would be most effective.
  2. Make your financial benchmarks of success congruent with your key performance indicators (KPIs). Alignment of your supply chain KPIs with your business is critical. Simplified cost measurements may not be illustrating success or failure accurately.
  3. Take a look at the KPIs behind the numbers and the numbers themselves. If your data relies on cost per pound, make sure you consider factors that can affect that data, such as density and length of trips. You want to be able to understand why shifts and changes occur.

Rockfarm Supply Chain Solutions and You

Rockfarm Supply Chain Solutions takes a holistic and integrated approach to supply chain systems. Our coaching solutions are a step above consulting because we work with your team to create custom, scalable solutions to help you make shipping more effective from the moment of customer contact to the minute they get their orders. Our transportation management services improve interactions among everyone in the supply chain, including shippers, vendors and you. Every step of the way, we look at the big picture to help you make data-driven business decisions designed to help you grow your business.

Contact Rockfarm Supply Chain Solutions today to find out how we can make supply chain decisions seamless for your organization.

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Brad Stewart, President

By Brad Stewart

Co-Founder, CCO

Brad’s journey into logistics began as a Marine Officer and transitioned from the LTL docks to the non-asset side within the logistics service provider arena.  As a co-founder of Rockfarm, Brad drives our business development efforts and delivery of our promise. An Arizona native, Brad enjoys spending time outdoors in his home state with his wife and family.

“Our approach to the market allowed us an opportunity to push forward in 2008 and enable our mission, “lower the cost to serve” to stand as a cornerstone to our company today.”


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