Are you aware of the changes in sea freight?
Sea freight is one of the most volatile forms of transport when it comes to variations in rates. It can vary from week to week, and it can be difficult to evaluate if the rates are being adjusted according to offer, conditions and the market in general.
We offer to manage your rates and ensure, that you are not paying too much for your sea freight.
We can help you to ensure, that the rates are not only ajusted according to agreement, but also that your rates are relevant versus the market rates. We work exclusively databased and evaluate by input from over 700 customers, rates at the moment and what yours should be. We contact your transport provider and ensure the rates are adjusted to the right level.
In case you are interested, please contact Rudy Kjeldsen on phone no. +45 51 19 97 67.
We are looking forward to receive your call.
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Who is checking your invoices?
Freight costs
Most transport purchasing companies know the tendency; Once an invoice is received – you just pay it, without checking it for eventual mistakes.
About 1-3% of the yearly freight costs for transport purchasing companies are from mistakes on the freight invoices
At Dansk Transportoptimering we offer full invoice control, where we check your invoices for mistakes. We monitor your statistics for the previous month. Your only task is to ensure the freight has taken place and pay the invoice.
As a customer within the world of transport, you often get information about new surcharges, which you often approve without checking wether these are actually necessary. Dansk Transportoptimering can also check your surcharges, thereby ensuring only necessary surcharges, and in the right amount.
How Dansk Transportoptimering works
How we assist our customers:
- Ensuring the chosen comply with your frame agreements
- Improving billing structure
We have a long list of competences which we use depending on the project :
- Concept developement
- Improvement projects
- Process optimizations
- Transport provision and following transport contracts
- Storage and logistic solutions
- Management consulting
- Interim management
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When transport becomes a competitive advantage, and not just a cost
For most transport purchasing companies, transport costs are a worry and a strain. Dansk Transportoptimering are specialists in transport- and process optimization, and we advise companies in purchasing transport, in optimizing and streamlining transport, distribution and logistics, by examining the underlying transport offer.
Often there are many savings to be attained by optimizing the transport process. Dansk Transportoptimering have assisted customers with a total purchase of transport of more than 5 billion DKK,and have achieved savings for our customers of more than 20 percent.
Dansk Transportoptimerings strength is that we know the transport industry and that we focus on the overall picture. We go through all transport processes, and we locate parts where customers can benefit from optimzations. We secure value in every part of the value chain from supplier, warehouse and production, and through to the end customer. We optimize the entire value chain.
Our focus areas are
External logistics
- Transport
- Storage
- Simulations and calculations
Internal logistics
- Process optimization
- Development of optimization tools
- Transport strategy
We assist our customers through four fases
Pre-analysis
We evaluate the overall savings potential, based on our customer´s present situation and requirements for the future.
When we have established how we can solve the customer´s challenges by use of a transport optimization process, we prepare a detailed project outline including:
- Project goals
- Sub-activities
- Internal and external use of ressources
- Maximum price for the project
- Milestones in the project
- Time plan
- Any critical factors
Analysis and concept
In this process we gather further data and conducts interviews to obtain the best possible insight in the transport flow of the customer, thus being able to pinpoint the processes with most potential for savings.
We examine internal and external processes, and this fase typically concludes a new transport strategy and covers a number of logistical improvements laid down in a resolution proposal.
Transport provision
Once establishing the new transport strategy in cooperation with the customer, we prepare the provision material, which is based on the given transport available. Once, together with the customer, the material is designed, and we contact the transport providers to negotiate and benchmark, to make sure the customer gets the best optimization based on the best offer. Once we mutually have agreed upon the best solution, new frame agreements is signed with the new transport providers chosen in the provision agreement.
Implementation
Now the new strategy and the new agreements are ready to be implemented, and we are continously working with the customer in this fase.
We have focus on key indicators and agreements, so the project gets the best start.
After implementation we finish off with an evaluation report, making status over :
- The project’s process
- Achieved results after optimization
- The overall project costs
- Future focus areas and proposal for a maintenance schedule
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Variation in the conversion factor
The conversion factors can vary, primarily within road transport.
The variation in the conversion factor is apparently because the average weight in groupage normally lies quite low ( 8000-12000 kilos per full load), and it is therefore easier to calculate into the price.
It is typically the larger companies, who covers all road transport within Europe, or other parts of the world, who make use of an alternative conversion factor. This is due to these companies use of internal settlement forms.
Example
By border crossing transport within Europe, most conveyors apply 333 kilos per cubicmetre as conversion factor. The same conversion factor can for some companies be as low as 150 kilo, which is more than half.
The difference in the conversion factor does not make much of a difference at high density, but most transport purchasing companies have a weight/volume ratio that lies closer to 150 kilos than to the 333 kilos. Therefore it is more attractive for you to obtain the low conversion factor as it rarely comes into use.
Hereby the uncertainty in your calculation base by freight calculation will be minimal.
You need to be aware
When choosing your forwarding transport provider you should include the conversion factor as a part of the overall benchmarking.
This leads to some challenges as the basis prices at a lower conversion factor generally are higher, than the prices you get from forwarding transport providers using a traditional conversion factor.
Therefore you should process the data for benchmarking one extra time, but then the end result is however often lower than expected.
Let us handle the benchmarking of the transport providers, so you obtain the cheapest solution.
In case you are interested, please contact Rudy Kjeldsen on phone no. +45 51 19 97 67.
We are looking forward to receive your call.
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Contracting
When entering into contracts between customer and transport provider it is important to note what the purpose is with the agreement or contract.
An agreement is, to make sure that you are in agreement of the conditions for an agreement, but also that you give a handshake on a cooperation, that stretches over an agreed period. However, the agreement must be beneficial for both parties.
As we experience a rising tendency, that companies lock themselves more than necessary through the signed contracts, we therefore choose to put focus on contracts with exclusivity, which not necessarily ensures a mutual benefit.
Consequenses
By concluding an agreement with exclusivity, it is primarily the transport provider who secures his company against a customer contracting with another provider to do a similar transport.
At the same time a transport provider will rarely commit to not contracting with a competitior to the transport purchasing company, as the provider would limit the business options, unless a very comprehensive and dedicated solution is required.
The consequences when contracting with exclusivity can in certain situations cause that changes is impossible during the contracting periode, as you are locked by the contract. This causes both parties to attain a less desireable evaluation once the contract ends.
If it is absolutely necessary with exclusivity, it is recommended that you agree on a mutual termination clause which can be exercised if necessary, to redefine the agreement.
Being aware
Basically a contract should ensure, that two parties are on commen ground, and the agreed contents are correctly stated.
We always recommend that you enter a long lasting agreement to secure mutual desire to develop a good partnership. However one should by eventual exclusivity consider which parameters could terminate the contract and a earlier termination.
As a contract has the purpose to outline the agreed terms between two companies, we recommend that you prepare a manual ( SOP ) which documents the expected daily cooperation. This document is changeable and is updated when needed.
Let us secure your transport agreements.
We offer advice and guidance in entering contracts and frame agreements between transport purchasing company and the transport provider, and we are ready to ensure, you get the optimal transport agreement.
We are looking forward to receive your call.
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Are your allowances appropriate for your company?
When your company enters an agreement with your transport provider, you will experience changes during the contract period. These changes are often due to changes in i.e. road tax, congestion charges or lack of capacity.
Once the allowances are applied, you will often receive an email or a letter from your transport provider, and now your role as a transport purchasing company is important.
As a transport purchasing company, you should carefully evaluate whether these allowances are relevant, by relating to your own needs. I.e. allowance on road tax in Belgium could arise, but you only transport to certain parts in France, where this allowance will be irrelevant to you.
It is important that you critically relate to these allowances, so you don´t pay for unnecessary allowances that you don’t need.
At Dansk Transportoptimering we offer our expertise and advise, so you don´t have to consider the changing allowances. We can assist you in evaluating the size and relevance of the allowances.
How Dansk Transportoptimering work
We can provide our customers with following:
- Ensuring that the selected carriers meet your framework agreements
- Improving the billing structure
We hold a long list of competences, which we use depending on the project:
- Concept development
- Improvement projects
- Process optimizations
- Transport provision and the following transport agreements
- Storage and logistic solutions
- Management consulting
- Interim management
Vi look forward to receive your call.
Follow us on LinkedIn
Contact us here
- Published in Blog