1. Business
Excellence
Operating
Strategy
Execution
Business
Excellence
© Copyright 2009
William Driscoll
Confidential and Proprietary

2. Operating
Execution
Supply
Chain
Operating
Production Execution Finance
Sales
© Copyright 2009
William Driscoll
Confidential and Proprietary

3. The Supply Chain
Corp Purchase Order Transportation
Supplier
Customer DC
Manufacturing
The Customer
Retail The Connecting
Link
Warehouse
© Copyright 2009
William Driscoll
Confidential and Proprietary

4. Logistics
Logistic Costs — the amount of money
associated with the purchase, transport, storage
and distribution of goods — are an unavoidable
part of the supply chain process.
Logistic Service – the satisfactory
performance of the suppliers it selects for
purchasing, transport, storage and distribution –
is an equally unavoidable element.
© Copyright 2009
William Driscoll
Confidential and Proprietary

5. Logistics Cost
Customer Carrier
Responsiveness
Requirements
Carrier Order Process
Contracts Cost to
Serve -
Customer
Fuel Cost
Warehouse
Cost Reduction
C Opportunity
Data
Shipping Accessorial Production
Charges Schedule
Department
© Copyright 2009
William Driscoll
Confidential and Proprietary

6. Logistics Cost
 Warehousing
 Vendors/ Suppliers
 Transportation
 Customer Expectations
© Copyright 2009
William Driscoll
Confidential and Proprietary

7. Logistics Cost
Warehousing
© Copyright 2009
William Driscoll
Confidential and Proprietary

8. Logistics Cost
 Facility Options
– Ownership
– Direct Provider
– 3PL
 Services
– IT
– Inventory Management
© Copyright 2009
William Driscoll
Confidential and Proprietary

9. Logistics Cost
 Marketplace capacity
 RFP consideration
 Industry Size
 Major Providers
© Copyright 2009
William Driscoll
Confidential and Proprietary

10. Logistics Cost
 Cost opportunity areas
– IN/ Out charges
– Kiting rates
– Pick/ pack rates
– Odd size packages
– Inventory management
– Technology enhancements
– Outsourcing
– Process
© Copyright 2009
William Driscoll
Confidential and Proprietary

11. Logistics Cost
Vendors/ Suppliers
© Copyright 2009
William Driscoll
Confidential and Proprietary

12. Logistics Cost
Manufacturing
 Commodity increases
 Lost raw material vendors
 Risk management
 Purchasing contract language
© Copyright 2009
William Driscoll
Confidential and Proprietary

13. Logistics Cost
Distributors
 Commodity based product
 Volume quantities
 Fewer vendors produce product
 Transportation
© Copyright 2009
William Driscoll
Confidential and Proprietary

14. Logistics Cost
Transportation
© Copyright 2009
William Driscoll
Confidential and Proprietary

15. Logistics Cost
 Marketplace capacity
 Mode selection/ change
 Rate direction
– Carrier partnership
– Negotiation
 Fuel
© Copyright 2009
William Driscoll
Confidential and Proprietary

16. Logistics Cost
 Carrier geography definition
 Mergers and Acquisitions
 HOS regulation
 Driver shortage
 Closed loop spend management
© Copyright 2009
William Driscoll
Confidential and Proprietary

17. Logistics Cost
 Recent safety legislation – CSA 2010
 Recent international legislation – 10+2
 Reach (Euro)
© Copyright 2009
William Driscoll
Confidential and Proprietary

18. Logistics Cost
Customer Expectations
continue to grow
© Copyright 2009
William Driscoll
Confidential and Proprietary

19. Logistics Cost
Delivery Performance
Logistics Cost
Service Reliability Cost
© Copyright 2009
William Driscoll
Confidential and Proprietary

20. Logistics Cost
Questions
© Copyright 2009
William Driscoll
Confidential and Proprietary