Effectively managing the inbound flow of material and information is perhaps the most difficult aspect of logistics management. The reason is simple: since you are not the shipper, routing decisions will ultimately be made by your vendor. How this is addressed requires creative solutions specifically designed around the way you do business. What are your goals? What is your relationship with your vendors? What are your current payment terms and how do your rates compare to what your vendors charge for “freight”? What are your operating constraints?

As a consignee, if you are relying on your vendors to manage your inbound transportation, your firm could be making a significant strategic mistake. There is no such thing as “Free Inbound Freight.” If you are responsible for transportation at your company and control only 40% of your inbound moves, it is virtually certain that you are leaving transportation dollars on the table. For example, if you are a $1B manufacturing company with a 5% net profit, you’re making $50M per year. With your vendors controlling $15M of your $25M inbound costs, you are exposing yourself to a large unmanaged expense. Implementing control measures and a 20% reduction of your uncontrolled inbound expenses would lead to an annual $3M dollar savings resulting in significant bottom line improvement for your corporation as a whole.

These are the types of questions we will ask when designing an inbound program for your company

An example of the benefits of Inbound Freight Management
As a consignee, if you are relying on your vendors to manage your inbound transportation, your firm could be making a significant strategic mistake. There is no such thing as “Free Inbound Freight.” If you are responsible for transportation at your company and control only 40% of your inbound moves, it is virtually certain that you are leaving transportation dollars on the table. For example, if you are a $1B manufacturing company with a 5% net profit, you’re making $50M per year. With your vendors controlling $15M (60%) of your $25M inbound costs, you are exposing yourself to a large unmanaged expense. Implementing control measures and a 20% reduction of your uncontrolled inbound expenses would lead to an annual $3M dollar savings resulting in a bottom line improvement of (6%) for your corporation. This the type of supply chain decision making that leads to bonuses and promotions for transportation/logistics professionals.