Optimising costs and processes and developing sustainable strategies for the future are the twin objectives of Oliver Exner, Manager Inbound Logistics EMEA at Burger King.
In 2008 the focus was on the tender and negotiations for long-term freight contracts with hauliers and service providers. Exner has been using electronic solutions for several years. In December 2008 a final decision was taken in favour of TICONTRACT. Of course Ive tested several providers of tendering platforms over the years, but the range of useful functionalities in TICONTRACT was what really convinced me. I also liked the teams commitment and enthusiasm right from the start.
The Europa Tender 2009, which was the working title of the tender procedure run in December 2008, included around 5,500 road transportation segments ex Europe to the distribution centres in 14 European countries. These were mostly temperature-controlled transport segments requiring curtainside/tilt/box, reefer-trailers and reefer-trailers with separation walls for multi-temperature transport. These types of trailer enable mixed goods to be transported in different temperature sections which are cooled independently on a single truck. The required temperature ranges went from -25C/-18C to +2/+4C and dry. The cargo was shown in matrices as Food, Mixed food and packaging, Frozen bread and Packaging. The tender included both FTL and LTL trips.
Via the extensive pool of providers with over 9,000 hauliers and the detailed search profile we were able to meet interesting new partners with the relevant equipment for the tender. We also invited our existing partners to take part in the tender explains Exner. A total of 454 service providers were invited to participate. By the end of the tender 129 complete bids had been provided via TICONTRACT. Preparing the tender in advance was extremely important. This detailed preparation meant that we could define standards beforehand which everyone had to meet before being allowed to take part. We were then able to rely on the quality of the service providers. Particularly helpful was the integrated email function, which automatically informed all participants of the status of the selection procedure at the click of a mouse. You very quickly lose track if you try to do that sort of thing by hand adds Exner.
The menu-guided matrix generator leads the dispatcher through the tender process step by step. This makes it easy to create even complex request matrices. Once created, the matrix can be used repeatedly as a standard template. Last year we only captured around 40% of our routes in TICONTRACT. In the next tender at the end of 2009 we will certainly map 60-80% of our routes with the tool says Exner. The system has also helped him to map alternatives to the existing routes and to request quotes for them. In addition to our internal route optimisation programmes the tool helps me to work out a strategic direction for the future, as it lets me get really close to the market and offers a great level of transparency.
As well as the different export functions I find the analysis function especially interesting. I can display best prices and rankings and simulate various scenarios for contracting hauliers. Exner is not primarily interested in the cheapest bidder. I see the benefits of a platform like this above all in standardising processes and making quotes more comparable. The economic crisis and overcapacities for freight were already apparent at the end of 2008. Last December pricing was already much lower than in the previous year, recalls Exner. But there were also some unrealistic quotes which we didnt follow up. Ultimately we rely on stable partners who can service the contract over the long-term. Exner expects the favourable pricing for dispatching companies to continue throughout 2009. From 2010 the price situation will probably recover again and get back to normal.