Freight consolidation and distribution from logistics service providers’ point of view
With their customers’ increasing internationalization, today logistics service providers are increasingly under pressure to assert themselves successfully on the market in a narrow, highly competitive service environment.
At the same time, customers are increasingly demanding a full-service provider who can take on other tasks in addition to traditional transport and logistics services. These include transport planning services, coordination with their customers partners and the handling of complete procurement and distribution tenders.
Classic examples are complex ocean freight scenarios where the logistics service provider plans and executes all processes on behalf of one or several customers, from pick-up from various suppliers in a third country to detailed distribution domestically. The service provider organizes the entire hinterland traffic, takes care of freight bookings and the complete shipment as well as customs clearance and compliance with trade regulations.
This trend towards full-service providers poses massive challenges for logistics service providers and is forcing them to adjust their organization and processes as well as to implement more flexible and modular template solutions. SAP TM supports logistics service providers in meeting the increasing requirements of a modern full-service provider in a holistic and standardized way.
Traditional service concepts are often customer-specific, individual solutions, which are usually not adaptable and are characterized by the following challenges:
In combination with SAP EWM, the transit warehouse functionality for logistics service providers closes an important gap in comprehensive warehouse and logistics solutions. Specifically, in addition to the transport processes, all relevant logistics processes in the area of warehousing can thus be covered on a single platform (SAP Supply Chain Execution). Examples are cross-customer consolidation and deconsolidation processes and the efficient operation of multi-customer centers.
The increasing demand for comprehensive contract logistics solutions is forcing service providers to be able to master logistics and warehousing as well as traditional transport services. Integrated holistic solutions are no longer a unique selling point of a few large players. Rather, these are a basic prerequisite for being successful in the market.
System landscapes that have grown over the years are often very heterogeneous and therefore complex and still have functional weaknesses:
As a fully integrated Supply Chain Execution (SCE) platform, SAP TM and EWM helps shippers, freight operators, and logistics service providers optimally in the daily provision of services for their customers. The close interconnection of both systems efficiently supports operative planning and execution activities, avoids redundant data storage, and thus facilitates focusing on customer needs. In concrete terms, the SAP SCE platform with its transit warehouse functionality offers service providers the following added value:
The operation of complex hub structures and the associated requirements on operators require integrated solutions. With SAP TM and EWM, logistics service providers have a high-performance system platform for fulfilling current and future customer requirements quickly and efficiently.
SAP TM is a modular software solution for shippers, freight forwarders and logistics service providers that optimally supports all transport logistics processes from central order entry, optimizer-based planning to freight charge calculation, cost distribution and settlement. Intelligent template solutions are characterized by:
Automation of standard processes (such as repetitive FTL shipments with automatic selection of sub-carriers)
Improved pick-up and delivery performance thanks to multi-modal planning and high process transparency
Improved cost efficiency due to (automated) selection of efficient means of transport and routes
Constantly high customer service levels, even in case of unforeseen events
Reduced personnel costs thanks to transparent cost structures
Minimization of financial risks due to automatic transport cost calculation and accruals posting
Higher margins due to optimal carrier selection and freight space usage
Increased utilization of resources due to smart consolidation of transport requirements
System-supported communication with process partners (carrier collaboration)
SAP TM provides all components of an integrated transportation management system. Thanks to its modular and highly configurable design, SAP TM ideally meets the requirements of modern logistics service providers.
valantic will support you during all project phases:
