Below and attached is an article printed in the Journal of Commerce ( JOC )on November 30, 2015 titled "Managing Your Money Via Technology" featuring a few clients of CT Logistics.
MANAGING YOUR MONEY VIA TECHNOLOGY
Increasingly sophisticated tools are making it easier for shippers to manage complex financial reporting
By Alan M. Field
Today's Automated Freight payment and audit systems offer businesses flexible tracking and financing programs that accelerate cash flow without impacting balance sheets. “People think of freight audit and freight payment as something very simple, but it’s not,” said Robert Sentz, manager of logistics planning and freight audit at Hospira, a Wisconsin based pharmaceutical maker that recently became a division of Pfizer. “When we have a contract with carriers, it gets very detailed, especially with the surcharges and everything.” Hospira ships more than 2,000 different products to markets in the U.S. and overseas.
To manage all that complexity, Hospira purchased a freight audit and payment system from Cleveland-based CT Logistics, which modified the system for Hospira and enabled the pharmaceuticals company to tie into CT’s servers, rather than install the software on Hospira’s own hardware.
“Their system handles that very well,” Sentz said. Hospira not only saves more than $500,000 on audit costs every year, he explained, “but we use it as a financial system because it does accruals. You know exactly what you spend” and can compare revenue with expenses. In addition, “The support we get (from CT) is fantastic.
“We have all our rates from our carriers in the system, which we download from our SAP system,” Sentz added. And because its carriers’ rates are always uptodate on the network, Hospira “has a good system for financial reporting.” This sort of freight auditing technology provides valuable business intelligence capabilities, he added.
The company can use it to do what-if, ad hoc scenarios, using the information it acquired while processing payment information in its financial supply chain. Many people have been amazed that the system does such a thorough job of analyzing that information, he said. Its capabilities are so granular, it can create scenarios that dig deep into the precise impact on costs that would result from taking relatively minor moves, such as relocating a distribution center.
Allan Miner, president of CT Logistics, explains, “We use the FreitRater (system) to deliver the freight audit services to hundreds of clients, but it can also be licensed by any one of those clients as a stand-alone, in-house software as a service.”
Like other software providers, CT enables its customers to choose among various usage options, depending on their needs, their budgets and their level of comfort when it comes to operating supply chain optimization software in-house. In the case of CT, there are three options:
- Purchasing the software: CT’s FreitRater software package is installed, along with subsequent software support.
- Software as a Service, or SaaS: 24/7 access is provided to secure FreitRater service via servers maintained by CT for a monthly fee. The technical staff at your company performs all contract rate entry and audit functions.
- Business Process as a Service, or BPaaS: The end-user acquires 24/7 access to its personal and secure software via CT’s servers, in return for a monthly fee. Unlike the case with SaaS, CT personnel perform most of the back office auditing tasks in such an arrangement. The end-user, however, has easy access to the most up-to-date information about rates and business rules, on a 24/7 basis.
For her part, Judy Colfer, manager of North American transportation for Mine Safety Appliances, a Cranberry, Pennsylvania-based maker of industrial safety protection, said the BPaaS option made the most sense for its needs. After researching many products, MSA settled on CT as its service provider. “It’s a complete one-stop operation,” Colfer said. “They handle everything. Our bills go directly to CT,” which scans them into a system that compares MSA’s tariffs with its bills, and identifies any discrepancies. “I can’t believe that there are some companies that don’t want to use this kind of service.”
To enhance its value as a supply chain tool, the FreitRater audit tool can be integrated into the CT Logistics Intelligence Optimization Network, or LION, software, which is designed to determine the lowest price for all shipping lanes, regardless of modes, carriers, ports, hubs and depots.
“It doesn’t matter what mode or what language” is involved, Miner said of LION. The software collects and analyzes costs at each point in the supply chain — when longshoremen are loading a product on a ship, after it goes out by rail to Chicago, goes to warehouse in Cleveland, and then gets broken down in less-than truckload shipments and is shipped to a distribution center. “All of those points in the chain are knitted together, and those contracts and rates are put into FreitRater LION.
“Anytime you want to know how you should ship it — and who you should partner with to minimize your shipping costs, based on one or another set of parameters and with a specific due date — then FreitRater can come back and give you millions of permutations on how to ship and route it,” Miner said.
Not every company makes such broad use of the data harvested by this sort of electronic logistics network. “It depends on how far you want to take” this technology, Colfer noted. In the case Mine Safety Appliances, among the most valuable benefits are the various trend analysis reports generated from the customized data of specific users. “They can be time-saving for you,” she said. “They are very efficient and very professional.”
- How efficient? Miner explained that tools such as the CT LION software:
- Generate spreadsheet pricing that is sortable, filterable and exportable to spreadsheets.
- Save the historical results of shippers’ executable plans in “a reportable database for future needs.”
- Easily create and save user-defined templates that are flexible and can be customized.
- Price multi-leg, multi-mode, equipment and service type routes.
- Calculate any shipping costs quickly with more than 17 million permutations per minute.
For the time being, demand for freight payment audit software seems to be growing faster outside the U.S. than inside its borders, Miner said. “We are getting huge traction outside the United States,” he said, noting CT’s sales are increasing at double-digit rates in foreign markets, but at a much lower pace within the U.S.
To address growing demand overseas, freight audit software available in the U.S. is increasingly globalized in content, and targeted at companies that do business across borders. CT’s FreitRater audits bills in various currencies and languages, while converting measurements in and out of the American and metric systems.
“The percentage of our business outside the U.S. is still less than 25 percent (of our total), but it is growing at double-digit rate — over 10 percent annually, whereas the U.S. growth rate is only 2 or 3 percent,” Miner noted.
Contact Alan M. Field at email@example.com.