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SCM 101: Load Optimization
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Monday, September 20, 2010
The primary goal of Supply Chain Management is to create efficiencies, ranging from organizational processes to inventory management. In terms of transportation efficiencies, the Supply Chain Management Department is utilizing a unique tool in the industry: Load Optimization.“Load optimization is the ability to fully maximize the cubic capacity of a truck, increasing efficiency and creating substantial cost savings.” The GlobalTranz Supply Chain Management Department utilizes load optimization software that automates this process. Specific products or pallets can be loaded into this software, including descriptions, dimensions, and weights. Stacking rules can be applied to each product to determine if it can be bottom freight, top freight, or non-stackable. All these details go into the configuration of each load’s optimization.Through our load optimization program, GlobalTranz is able to look at the bigger picture of transportation, not just the transactional price for each load. For example, an organization may be moving 20 truckloads a month, but inefficiently loading the capacity of those trailers. With GlobalTranz Supply Chain Management load plans, each shipment can be optimized to the highest efficiency. Thus, instead of moving 20 truckloads a month, an organization may be able to consolidate into 16-18 loads, creating enormous cost savings while still being able to move the same volume. Therefore, rather than selling based on the price of each shipment, GlobalTranz can sell a holistic solution, which creates more significant cost savings. In addition, damages may be reduced due to the stacking rules being followed.Another key benefit of load optimization is its ability to generate step-by-step load plans: laying out exactly how each pallet should be loaded. Taking the “guess work” out of the equation allows the dock crew to become more efficient when loading trucks, decreasing internal resources for your clients. Additionally, the load plans have the ability to combat against rebills and disputes. For example, a carrier may attempt to rebill a customer for utilizing 20 linear feet when the freight only utilized 17 feet of floor space. With detailed load plans, GlobalTranz can offer proof of how the freight was loaded, which can be used to dispute the charges.These benefits are true value-add services that can be used to attract more business. With a consistent price war in the transportation industry, it is services such as load optimization that allow GlobalTranz Agents to differentiate themselves from their competition.
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