Freight Shipment Cost Optimization for a leading North American Manufacturer

Case Study

Freight Shipment Cost Optimization for a leading North American Manufacturer

Business Objective

Our client is a leading manufacturing company in the US.

The client wanted to reduce air freight spend and bring visibility into their PFR (Priority Freight Requests) by:

  • Identifying potential reasons for air freight spend through root cause analysis
  • Providing and implementing solutions to reduce the spend

Challenges

  • Validation of PFR tickets with shipment carrier data requires manual effort in mapping cities to plants between carrier data and PFR data
  • No lead time data for their 167 plants
  • Quantifying business logics where there were no service level cuts

Solution Methodology 

  • Analyzed various data – Shipment Data (product-related), Requested vs. Delivered Dates, Shipment Order Type & From-To details, Carrier, Route, Shipment Configuration Data
  • Defined cut level to determine the PFR reason
  • Identified the months when the cut started happening and diagnosed the cause that led to the cut in the identified months
  • Developed methodologies to calculate the values for root causes as per business logic
  • Undertook calculations and analyzed deviations in the root causes
  • Associated potential causes with the PFR tickets and assigned dollar values
  • Performed root cause analysis

Business Impact

  • The solution resulted in quick wins with a total impact of USD 4.5 Million on PFR Spend
  • Potentially long-term savings could be achieved using the recommender system that can provide triggers to avoid the PFR request in the future and also suggest timely requests of PFR
Download Case Study

©2017 Tiger Analytics. All rights reserved.

Log in with your credentials

Forgot your details?