To rationalize and minimize fuel surcharges, Dairy.com recommended that Dean Foods implement a standard fuel surcharge program. This program increased the efficiency of the bidding process for all parties involved. Dean Foods’ carriers were given the choice to accept the Dairy.com fuel surcharge structure—or to bid the business with no fuel surcharge using a flat rate. So far, this system is working favorably for Dean Foods.
The results of using the online solutions and services provided by Dairy.com have been exceptional with double-digit savings in several areas, reports Matson. For instance, Dean Foods has achieved about a 20-percent reduction in contract freight rates and between 20 percent and 40 percent savings in spot transportation costs. The elimination of embedded freight costs from purchased ingredients has saved the company about 30 percent of its transportation costs. Optimal scheduling produced about a 13-percent reduction in average miles per move, resulting in additional savings for the company.
“The visibility through the Dairy.com network allows for more consistency than we ever had working with our contract haulers for outbounds,” says Matson. “The system really helps us know who the carrier is that is hauling. We have a lot more consistency since the lanes are covered by the same carrier over and over again so the carriers become very familiar with the lanes we run. And since we are dealing only with one vendor in a particular plant, we have a lot less billing and accounts payable activities than we had with multiple carriers serving a particular plant.”
The more competitive rates Dean Foods is getting through Dairy.com’s bid list are another advantage, notes Matson. He adds that the alliance with Dairy.com also expedites the company’s drop-trailer activities.
“It’s been a win-win-win situation for Dean Foods, for the carriers, and for Dairy.com.,” says Matson. —April Terreri
2. Greatwide Logistics centralizes dispatch capabilities - DALLAS - A national provider of third-party logistics services.
Greatwide Logistics Services in Dallas wanted to increase efficiencies in its dispatching process, says Lloyd Boyd, CIO. “We meet high-service demands with a dedicated brokerage and managed transportation services type of model for the food segment of our business. The goal for us was to centralize our dispatch capabilities and standardize the process so we could create more efficiency and continue to create value for our customers by providing the service they expect at the price they expect,” explains Boyd.
Greatwide is the largest dedicated refrigerated provider in the country.
As the company sought to answer this question, it actually created another question. That was how to retain driver relationships with centralized dispatchers. Drivers are accustomed to being able to sit and converse with someone at a local operations center,” says Boyd. “They are on the road for long periods and they like to have that human interaction. So our question was how can we continue to provide that kind of personal attention.”
The solution for Greatwide was Microsoft’s XRM (Extended Relationship Management) product coupled with McLeod software used in the company’s centralized dispatch organization, Transportation Operations Center (TOC), at Greatwide headquarters.
“We slightly modified the XRM system to sit atop the McLeod trucking system. This provides an interface into the McLeod system that leverages some of the details we require for the relationship management,” Boyd explains. “The software helps us collect information that allows us to understand the haul preferences drivers have. We usually present drivers with a choice of loads based on their preferences and ask which one they prefer.”
Once the driver has selected his preferred load, dispatch selects the load and the system automatically updates which load was chosen and operations can then track the progress of that load through settlement and billing. Boyd notes this system first rolled out in December of 2009 and continues to be rolled out throughout Greatwide’s network of 59 operations centers.
How is the system working so far? “We were blown away by the results, which we measured,” reports Boyd. He says the company conducted two separate studies. One was a time-motion study clocking the entry time required to complete a dispatch going directly through the McLeod system. The company then studied the number of loads that were being managed by TOC before the rollout and the number of loads being managed after the rollout.