Transportation Project

Transportation Project

The Case

International Company in healthcare, utilizes 7 different transportation companies to distribute its products and spare parts 

The Challenge

Following a detailed analysis of the company’s needs and several discussions with the key stakeholders, LPS and the team identified the following issues:

  • Need for daily national & international transportation services (usually groupage)
  • 20% of shipments characterized as urgent (same day delivery, delivery appointment)
  • Need to manage product returns
  • Negotiated freight charges were on a per kg basis without volume / weight ratio

The Steps

LPS, utilizing international practices and tools :

  • Categorized and Standardized company’s real transportation needs
  • Identified the best solution per category, based on company’s real needs and cost – service ratio.
  • Performed Market research to identify the qualified transportation providers
  • Submitted a proposal with a detailed project roadmap and expected cost reduction

The Results

The project team, led by LPS, implemented the proposal and:

  • Achieved a 20% reduction in the number of forwarders used and improved control, service levels and reduced operating costs
  • Succeeded in reducing distribution costs by 32%
  • Implemented a detailed reporting system for transportation, deliveries and item returns
  • Developed standardized Agreements with beneficiary for the company terms, clear freight charges and KPI’s (Key Performance Indicators)