Prompted by a recent conversation with a customer, it’s time to shed some light on our parcel audit pricing structure. We consider it a simple gain-share model, but it can be a bit confusing.
We deliver hard and soft cost savings to companies who ship with any major parcel carrier – FedEx, UPS, DHL, TNT, US Cargo, BlueDart, etc. The net result is that our customers pay less to ship parcels than they would without our services. How do we make money?
We label the carrier refunds we secure for late deliveries and billing errors “hard cost savings”. They show up on your bill each week because of our work. We get a split of those savings, tiered for higher volume shippers. That’s the full extent of our fee. No minimum, no set-up. If we don’t save you money, we starve, so there’s a healthy incentive built in.
We deliver “soft cost savings” for free. These are savings obtained through operational changes made based on the information we provide. For most customers, these savings exceed the hard-cost savings, but it’s up to them to make it happen.
It’s not uncommon to discover 10%+ in operational savings opportunities. Here’s a snapshot of some of the reports:
Air to Ground Conversion report identifies Air shipments which could have gone Ground without compromising delivery time. Sometimes companies ship Express because it just fits for reasons other than time. That’s okay, but if they ship Air because they think it’s faster, we’ll be the ones to blow the whistle. Our configurable ‘ATG’ report will tell you what you could have saved by shipping Ground instead of Air, when time was the only issue of concern. Go beyond 20-20 hindsight with our rate-shopper tool built into the reporting interface. You select the shipper and service class according to delivery time and cost and voila, the problem is fixed.
Competitive Intelligence shows what you could save with Direct-Recovery that you’re missing right now. When a customer approaches who is running an in-house audit, or is with a competitor, we have a fabulous report to show exactly what credits we would go after, and whether or not they’re receiving those credits. Customers walk away confident they have the situation well in hand, or, more likely, we win another account.
Consolidation Report shows you two or more parcels shipped the same day to the same destination, and the possible freight savings had those shipments been combined. Operational inefficiencies can drain a shipping budget. We help optimize every penny.
Rerate. We have bundles of rerating reports. Take your history and run it through any number of analytical scenarios:
“What if we ran 30% of our Eastern Seaboard shipments through Eastern Connection at our discounted rate schedule?” or..
“What if we added a distribution center in the MidWest. Would the cost savings justify the capital outlay?” or..
“FedEx has a competitive offer. What’s the savings in real dollars compared to UPS? Rerate the last 12 months to find out.”
The reports go on and on – some 300 of them, all fully configurable, and all added because another customer at some point thought they were useful. And there’s always our Ad Hoc report writer for the curious adventurer, or the custom programming option for the curious, but less DIY inclined.
Back to the price question – all this is free. The reporting module, the intelligence, the mine-able history, and especially, all the soft-cost savings that comes to the active users. It’s all thrown in. Our fee is a split of the hard-cost recoveries, which you’re probably overpaying anyway.
It’s a pricing model that leaves people scratching their heads — now why wouldn’t I do that?