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IDII Software Newsletter Volume 1 No. 15 November 14th 2000 |
To assist the professional dealing with software in Warehousing Distribution, Logistics,
and the Supply Chain.
Subscribe to newsletter Now..
| Techniques, Vision, & Educational Thoughts "Computerized Shipping Systems - Return on Investment - Part 2" The reality is that most mistakes go unnoticed, so this is the time to determine how many mistakes are occurring in your operation - mistakes that are costing your company revenue. A Texas A & M University study concludes, " It costs $50 to correct an error." The reason is that a mistake in shipping typically means that the wrong product was sent and has to be picked up; normally the company shipping the product pays that expense. Additionally, it includes the cost to reship the correct product, and many times, there is the added expense of expedited freight to keep your client happy. And, let's not forget the cost of administrative time to change and correct the invoices. Clearly, errors are easily a $50 cost each. So, even if we are extremely conservative, and use only 7 mistakes a day as significant, (which is 99.99% accuracy) at $50 each, our costs come to $350 a day; multiplied by 22 working days, $7,700 a month and $92,400 per year! This alone can justify the investment in a computerized shipping system. You can read more about this in Chapter 2, Reengineering the Shipping Process. Let's next consider the direct saving in labor gained from eliminating the manual rekeying of data in the accounting department. Ask your accounting clerk how long it takes to type in the freight charges, the 18 character alphanumeric tracking number, other data, and the keystrokes necessary to complete the order. Let's say it takes two minutes per order, multiplied by 200 packages, or 6.5 hours a day. This is assuming that this clerk types non-stop and does not take a single break or gets interrupted. At a labor rate of $20/hr with benefits, multiplied by 6.5 hours, we have a total labor expense of $130 a day; $2,860 a month and $34,320 a year. A computerized shipping system can cut labor costs significantly. Another big mistake that companies make, is that they don't shop for the best carrier for the level of service they need. The Official Express Management Guide (OESG)(1995) informs us that "40 to 50% of packages sent next day delivery could be sent by a less costly means of transportation." Let's say that your company, shipping 200 packages per day, sends 25% next day, or 50 per day. Let's even pretend you have a good discount and pay an average of $25/pkg, and 50% of those could be sent out for less. It is not unusual to find that the same packages could get there for $5 at the same time or sooner. Packages shipped by a guaranteed ground service, for example, can get there the next day or second day at a fraction of the cost. This is a saving of $20 per package x 25 packages or $500 per day. On a monthly basis, the savings would be $11,000, and $132,000 a year. This comes to an overall reduction in freight costs of 25%, completely in line with the OESG conclusion that "80% of shippers are overpaying freight costs by 20-80%". If the potential for savings and improving shipping room productivity can be so significant, why isn't every VP of Operations taking a good hard look at their internal shipping operations and acting, if necessary? Here is the reason. Most companies bill their customers for the freight charges. It just isn't important because the customer is paying for the freight anyway. That is why it is important to find out if it is your company that pays for the freight and what percentage of the time. No one bills customers for freight 100% of the time. And many times the costs for shipping air packages are absorbed by the shipper because they are internal sales or executive materials. (In our next issue - we will discuss the free shipping systems - are they really "free"?.) Mark A. Taylor, President of Taylor Systems Engineering Corp.) |
Impact In Software Design Software designers in ERP, WMS, OMS should decide which path to take. Path #1: Partner with an existing SMS solution. See Software Directory. Path #2: Build your own SMS - realizing that twice a year rate changes WITH new forms of rates & new addons from each carrier could be required. Phil Obal TIP from Phil There are a good number of multi-carrier shipping systems available today. If the system has multiple carriers, then one can "rate shop". See Software Directory. |
WEBSITE FOR SALE
"WEBSITE For Sale"
The website www.inventory.com is for sale. Has fantastic potential for those needing a popular website name. If interested, contact Philip Obal of IDII at 918-464-2222 and we will provide more details & put you into contact with the seller's representative.. Serious inquiries only.
IDII News
- IDII now offers consulting services for software
selection, evaluation,and implementation.
If your company is needing help in a WMS
or ERP software selection, give us a call
at 918-464-2222.
- Searching for new logistics or warehouse
software? New and improved version of our ADVANCED WAREHOUSE & LOGISTICS RFI. New questions have been added. New feature
added where each question asks for planned release and
enhancement cost approximations, when the current production release does
not "fully" perform the
requested
function.
- Contains approximately 770 detailed questions that are detailed with a pop-up text box, color coded answers, validation of answers. RFI questions are ready to send out to software vendors. One may modify existing questions and add their own questions. Available in electronic format (CD-ROM). Requires Excel 97 or above. See press release for latest information..
- Delfour Partners (WMS, 3PL, EDI, TMS) with
SyVox Corporation
Delfour Corporation has announced its newest partnership with SyVox Corporation, a leading provider of speech recognition-based applications for industrial markets. Delfour and SyVox team to provide a complete solution to the end user.
- Fourth Shift Corporation (ERP, MRP, CRM,
Nasdaq: FSFT) purchases Endurant Business Solutions (CRM). Fourth Shift plans to merge it's Headwaters
subsidiary with Endurant.
The market need for CRM consulting continues to grow. In a January report, AMR Research predicted that over $8 billion would be spent on CRM consulting in 2000, representing 160% growth over 1998 figures.
- Kewill Systems plc (SMS, TMS) has reached agreement with i2 Technologies (TMS, APS) to license Kewill’s shipping and visibility software
for use within i2 TradeMatrix Transportation
Manager. The combined i2 and Kewill solution is designed
to provide trading partners with online collaboration
tools to efficiently ship, trace, control,
and receive goods.
Kewill.Net Internet-based applications feature solutions vital to the fulfillment execution process. Kewill.Ship will provide i2 users with automated transportation routing and cost calculations for managing parcel shipments, while creating bar coded tracking labels and electronic manifests for multiple carriers. By using Kewill.Receive, customers will be able to integrate in-transit visibility with their receiving processes.
Bill Allison, VP of Fulfillment Solutions Development at i2 commented: “We continue to seek to partner with best-of-breed solution providers that add value to our core fulfillment offerings. Kewill is able to offer us a solution to address multi-carrier compliance and small package visibility issues for large and small businesses alike in the U.S. market.”
- MOTEK(WMS) - MOTEK does WMS MPLEMENTATION in 40 days. The company underwent extensive internal
training to ensure that everyone
understood
the new streamlined approach. "Our
last
implementation went live without
requiring
overtime or weekend work 40 calendar
days
after the customer signed the contract."
said Motek's Project Manager Dawn
Stramer
who managed the installation. Dawn
credits
preparation and a bullet proof process
as
the reason she was able to beat industry
standards. "We delivered a full
featured
WMS in record time under budget"
said
Stramer.
- nPassage (B2B, TMS) announced that it will offer global trade
management capabilities as part of
its Internet-based
transportation management service
through
a partnership with NextLinx (TMS, Landed Costs). nPassage will combine its software's ability
to manage the execution of freight
shipments
across all modes of transportation
with NextLinx's
Global TradeManager™ and Global Knowledge™,
the most comprehensive, up-to-date
database
of information for countries around
the world.
It includes product classifications,
trade
regulations, the latest duties and
other
governmental charges.
This offering will include the following
services: Harmonized Tariff Schedule Wizard, Denied
Party Screening, Special Product Licensing,
Total Landed Cost, Regulatory Trade Documentation.
- Open Applications Group (OAG) has just issued an XML standard for Advance Shipment Notices. A non-profit consortium of software makers,
the OAG is developing non-proprietary,
XML-based
standards
- Prophet 21 (ERP, Nasdaq: PXXI) has selected and deployed Moai's LiveExchange Enterprise for TradingPartnerConnect -- Prophet 21's digital marketplace. Using
LiveExchange Enterprise, Prophet
21 offers
its distributors private online negotiations
for durable goods, including inventory
liquidation,
effective January 2001.
The addition of Web-based auctions, reverse auctions, and related contract negotiations to TradingPartnerConnect will help transform the way Prophet 21 conducts business with its 2,000 customers in the durable goods market. With the help of LiveExchange Enterprise, Prophet 21's distribution customers should be able to liquidate excess or obsolete inventory on TradingPartnerConnect direct from their Prophet 21 Acclaim(R) or Prophet 21 CommerceCenter application.
"Moai offers a powerful and comprehensive online negotiation tool for the complex buying and selling that we believe our durable goods customers will conduct daily on TradingPartnerConnect," said John Seaner, Senior Vice President Marketing and Strategy, Prophet 21. "We reviewed the auction capabilities of many vendors and chose the Moai solution because of the advanced functionality of Live Exchange such as customization, degree of control, and multi-parameter bidding capabilities including price, payment terms, and quantity."
- Prophet 21, Inc. (ERP, Nasdaq: PXXI) and AUTO CRIB Systems, a provider of 24-hour,
automated access to critical tooling and
supplies, announced an agreement to integrate AUTO CRIB automated inventory
systems into Trading Partner Connect -- Prophet 21's digital marketplace for the
exchange of durable goods. AutoCrib remote
stations placed throughout a facility can
dispense everything from medical, MRO and
office supplies to safety equipment and machine
tool supplies.
- Robocom Systems International Inc. (WMS,
Nasdaq: RIMS) announced XML compatibility for its RIMS
Warehouse Management Software.
Robocom announced XML compatibility as part
of its successful participation in today's
Open Applications Group, Inc. (OAGI) Vendor
Challenge, in which Robocom demonstrated its RIMS WMS
product compatibility with leading e-commerce
applications. In the Challenge, 24 OAGI member
companies set up an entirely electronic supply
chain, using their own applications and XML
interoperability standards developed by OAGI.
- Syvox (Voice Software and Hardware for WMS/ERP
users) Announces Speechnet® Logistics Enhanced Speech-Based
Solution. SyVox Corporation, announces the availability
of SpeechNet® Logistics, a new generation
of speech applications for the warehousing
and logistics marketplace. Formerly known
as RxP, SpeechNet Logistics offers an enhanced
object-oriented design that facilitates turnkey
installation, along with an upgraded Administration
Console and Prompt Manager providing improved
user and management features that increase
logistics productivity.
SyVox's anchor product, SpeechNet Logistics, includes modules tailored for warehousing and logistics workers with mobile tasks - such as picking, put-away, cross-docking and cycle-counting - where it is optimal for the worker to function with hands and eyes free from paper and hand-held terminals, improving productivity, accuracy and safety. An interactive speech-based solution, SpeechNet Logistics enables warehouse workers to hear instructions through a headset earpiece and to communicate verbally with the data management system through a wireless network. SpeechNet Logistics is easy for management to deploy and requires no end-user knowledge of computers.
- Symix Becomes Frontstep. Symix Systems, Inc. (ERP, Nasdaq: SYMX
(old), Nasdaq: FSTP (new)) announced it's
new name "Frontstep, Inc.". The
company will immediately begin operating
as Frontstep. Pending the completion of required
filings, the company's common stock will
be traded under the symbol "FSTP.''
- Vertex Interactive (WMS, TMS) - Acquired Renaissance Software (WMS,ERP) - See their website at www.vertexinteractive.com.
Quotes to Ponder
- "The door of opportunity won't open
unless you do some pushing."
-- Anon.
- "It takes as much courage to have tried
and failed as it does to have tried and succeeded."
-- Anne Morrow Lindbergh
The Seven Flavors of TMS from Modern Materials Handling magazine - Very good overview on different types of TMS solutions, and the integration of TMS, WMS, and OMS.
Scripture to Ponder
"He who walks with integrity walks securely, but he who perverts his ways will become known." Proverbs 10:9
Good Book
| "Computerized Shipping Systems: Increasing
Profit & Productivity Through Technology (New Millennium Edition)" |
 |
| Taylor, Mark A. | See reviews and more information on this book at Amazon.com |
Another Good Book
| "What To Look For In Warehouse Management System Software" |  |
| Obal, Philip | See reviews and more information on this book at Amazon.com |
Valuable Future Events - October
MAY 9 TO 11, 2001 - E-LOGISTICS EXPO - The Logistics Institute at Georgia Tech, GFB, Announce an Educational Conference
and Team-focused Tradeshow in Atlanta, GA.
Responding to the need to bring leading-edge
education and world-class solutions providers
together in a "team environment,"
the e-Logistics Expo announced today the
creation of a new "knowledge tradeshow"
to be held next May in Atlanta. The Expo
will be held at the Georgia World Congress
Center. The Expo features a full three-day
educational conference led by The Logistics
Institute at Georgia Tech. Contact Carrolyn
Prescott at GFB at 404-524-7777, or e-mail
to cprescott@gfb-expo.com
About This Newsletter
We educate and share news on software for
warehousing, transportation, shipping, packing,
slotting, loading, optimization, and enterprise
wide software solutions. This free newsletter is published twice
a month and is targeted toward supply chain
professionals involved in software. Currently,
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© 2000 Industrial Data & Information Inc. All Rights Reserved.. Trademarks belong to respective trademark holders. Information accuracy is not guaranteed due to variety of sources.
