What are you doing to improve service and cut costs?
By Marc Barnes -- Furniture Today, October 6, 2008
Id: 4801
Offering new services
Carrying more inventory
Providing white-glove service
Enhancing efficiencies
Partnering with other companies
Shaving delivery time, cost
Achieving a higher 'stop rate'
Creating a one-stop solution
Using new routing technology
Identifying ways to improve
Using Web-based tools
Boosting fuel efficiency
Offering new services
Carrying more inventory
Providing white-glove service
Enhancing efficiencies
Partnering with other companies
Shaving delivery time, cost
Achieving a higher 'stop rate'
Creating a one-stop solution
Using new routing technology
Identifying ways to improve
Using Web-based tools
Boosting fuel efficiency
HIGH POINT — The question is simple: What are trucking and logistics companies doing to improve service and cut costs for furniture customers in this tough business environment?
The answer is considerably more complex. Some companies are coming up with new products; others are finding ways to be more efficient with the tried and true. Some have consolidated or formed new partnerships to tap into the economies of scale that are possible with larger firms.
If there is a common thread in these firms — which run the gamut from trucks that navigate neighborhoods to ships that cross oceans — it's this: faced with economic pressures and a changing industry, those who are successful must be willing to change.
Offering new services
“We have developed two new service offerings, Direct Express and Direct Recovery. Direct Express is a guaranteed expedited transit. We can get it to you within a guaranteed period of time. Direct Recovery is a returns management solution. Our logistics cross dock in Indianapolis will be our new returns center, where (the furniture) can be restored to like-new condition. We are saving a full leg of transportation and we are warehousing it, cutting down on costs. And (the manufacturer) will have another consumer who wants to make that purchase.”
Jim Mikrut
Vice president, customer experience
Home Direct USA
Carrying more inventory
“We are throwing out the traditional ways of doing business and bringing new ways. If you have a 10,000-square-foot stockroom, you would be better suited to put samples on the floor and let us take the inventory. We can receive it from the manufacturer, deluxe it and bring it to the home. You don't have to get the product to the stockroom — you can leave it in the warehouse and sell sold orders through us. You have to shorten up the supply chain and everything that has a direct cost to it.”
Mark Barragan
Triple Crown Group president and principal
FurnigistiX
Providing white-glove service
“We are getting creative with load planning, co-mingling freight, paying attention to customer needs and making sure we are giving white-glove service to everyone. We deal with a lot of blanket-wrap furniture and being more green by using blankets. And we are helping companies reduce costs by taking care of everything — storage, distribution and devanning.”
Kirsten Orszag
Director of human resources
America West
Enhancing efficiencies
“Signature service means 'on time, cost-effective, damage free.' By tightly integrating our flexibility and agility, combined with a culture of ownership by each of our operators, we are squeezing out every efficiency and reducing costs wherever we can for our manufacturers. A receiver in South Florida recently called and said, 'we used to have challenges with some deliveries but we just love you guys and your drivers are so good to work with.' This has to bode well for our customers' business.”
Brian Barkman
President
Signature Supply Chain Management
Partnering with other companies
“We at Mainstreet Delivery have partnered with the newly created Worldwide Logistics. This gives us one specialized furniture carrier that can cover transportation needs to a larger portion of the United States. This allows us streamline our transportation, which will allow for quicker transit times from the manufacturer to our delivery agent as well as reduced damage, which is a significant cost reduction. We have also made several enhancements to our proprietary order management system (and) clients now receive e-mail updates when order status changes.”
Maury Mussa
President & CEO
Mainstreet Delivery
Shaving delivery time, cost
“Cory Home Delivery has initiated a strategic three-way partnership with Demountable Concepts and Penske Truck Leasing, which enables Cory to shave delivery time and money from the bottom line for retailers. The essentials of the warehouse on wheels are a convertible base frame equipped with legs that fold underneath for truck body transport and unfold during free-standing storage and a chassis lift system installed onto pre-existing or new 26-foot “swap” body trucks. The process begins with two bodies (that are loaded, transported by semi and then left freestanding on their own support system in the local Penske yard). Local driver teams then mount the freestanding bodies to 26-foot straight body trucks and proceed with deliveries. The Demountable concept is right on the money for retailers trending toward centralized warehousing to serve outlying markets.”
Patrick Cory
Vice president of strategic development
Cory Home Delivery Service
Achieving a higher 'stop rate'
“Achieving the highest possible 'productive stop rate' is critical when you get to the last-mile delivery stage, where the average cost of a home delivery can be significant. 3PD has put a lot of time, money and emphasis into getting our productive stop rate to 96% — about 6% higher than the industry average — through the deployment of best-of-class visibility tools, such as calling ahead a day or two, sending the same advance notification via e-mail or text message, and then making another call when a truck is close to a customers home. The financial impact can directly equate to a nearly 10% to 15% reduction in re-delivery costs.”
Charlie Hitt
Executive vice president of operations
3PD
Creating a one-stop solution
“What we are doing is merging our operations together and offering more services than we did previously. We have a lot to offer and we are busy right now disseminating information. People are looking for a one-stop solution for their transportation needs. We are trying to do everything within our power to operate as efficiently as we can to keep from having to raise costs.”
Eric Clarke
President
Worldwide Logistics
Using new routing technology
“We have installed some of the latest computer routing technology to make sure we can cut down on as many miles as possible. We stay on top of equipment maintenance and make sure it gives us the service that we need. In all three companies, we are working together to keep the minimum of miles down and the density in the area that we need to service. We are not running extended miles to get our freight delivered. We are trying to watch all of the cost factors that are out there. As far as improving service to our customer, we are using the latest computer technologies to manage freight and get it delivered in a timely manner.”
Ron Boroughs
Senior vice president of business development and administration
Furniture Transport Group
Identifying ways to improve
“On the warehousing side, we are creating efficiencies and looking at all the facets of transportation. On the transportation side, we are really seeking to partner with our carriers to find out where they are most efficient in their operations to create traffic lanes that work in those efficiencies.”
Dave Riley
Vice president of operations
Salem Logistics
Using Web-based tools
“We just put in a new transportation management system that is Web-based — a customer that is using ocean freight with us can track and trace anything regardless of what menu of services they have opted to use, from Asia through domestic delivery. We are also making ourselves more efficient internally to help drive down costs — we watch our headcounts. Our equipment is fuel efficient and we have programs with our drivers to keep costs down and rates as low as possible. For our customers who use our ocean freight service, we formed an ocean shippers association, where we take those accumulated volumes of projected containers and we negotiate the best possible steamship rates that we can.”
Steve Wolfe
Vice president of business development
Zenith Global Logistics Solutions
Boosting fuel efficiency
“We buy bulk fuel to (reduce) transportation costs, we have a cap on the speed they can drive, and we have installed auxiliary power units, because they tend to run the heater or air conditioning and you can burn one gallon of fuel all night long instead of a gallon an hour. We are managing our work hours — we have gone through the entire workforce staff to see if we can operate as efficiently four days a week instead of five. We have standardized our fleet — using one type of engine gives us efficiencies through our shop operations. We have reduced the cost of capital by refinancing when we can. We have upgraded the computer equipment and we do EDI transactions and imaging — we want to get to a point where we don't have to touch paper. We have automated tracking and GPS on all our equipment, which keeps us from having to go through lots of phone calls and minimizes future investments.”
Joe Wade
President
Shelba D. Johnson Trucking
