You lock your car at night; you keep your ATM password secret, and you don’t let strangers log-into your personal email account, but how about the security of your company’s shipping dollars and data being held by your Parcel and Freight bill auditor and shipping partners? Are they secure?

When it comes to security, Parcel and Freight Bill Auditors need to be aware of the industry’s best practices. After all, these companies handle the same kind of sensitive information as banks and medical facilities. There are four high risk areas that your Parcel and Freight Bill Auditor should have in place to protect your company, its money and its data: Financial Controls, Personnel Security, IT Security, and Physical Security.

I. Financial Controls

As we have seen in recent news articles it is more and more important to have comprehensive fail safe financial processes for your own business and you should expect the same from your Parcel and Freight Bill Auditor. Here are a few things to ask them if they have to verify if they are protecting your money appropriately:

• No co-mingling of funds
• SSAE16 Type II Certification – A rigorous 3^rd party audited certification
• Highly scrutinized, redundant, fund maintenance & management
• Multi-level fund oversight; Accounting Clerk, to Controller
• Dual signature check control; over $25,000
• Annual, independently audited financials
• Separate financial processes; inbound/outbound
• Separate segmented accounting security system

American Shipper has pointed out that “many shipper-provider agreements entrust the provider with significant amounts of funds advanced by the shipper for the purpose of paying the shipper’s carriers.” However, “few shippers require providers to establish formal escrow accounts for their funds even when the amounts advanced by the shipper to the provider run into the millions.”

At BirdDog, a five-person finance team that consists of all levels — from an accounts payable clerk to the company’s controller — oversees client accounts. All our accounts have biweekly and monthly reviews. Most importantly, escrow reporting and review occurs at the customer level to ensure complete transparency.

II. Personnel Security

To protect your company against a security breach, personnel security should be as rigorous as fiscal security. The people who handle your money and data should be beyond reproach. Here are a few basic personnel policies that your Parcel and Freight Bill Auditors should have:

• Background Checks
• Credit History Analysis
• Criminal Record Analysis
• Prior Education Analysis
• Confidentiality & Non-Disclosure Agreements

III. IT Security

Shippers everywhere should ensure that whomever they trust to manage their accounting and auditing service has the internal controls to prevent an information technology security breach.

Here are the 15 most important IT measures that Parcel and Freight Bill Auditor should have in place to protect the integrity of your account, your money and your data:

• Published IT policies covering access, updates, and storage
• Restricted employee network access
• Recorded network login and activity logs
• Firewall protected Gateways
• Private and restricted VPN access
• Network intrusion detection.
• Mandatory login – user name and password
• Multi failure account Auto-lock
• Role & need access segmentation
• Minimum 256-bit security encryption protocol
• Regularly updated Anti-virus software
• Dangerous Email Scanning
• Complex and expiring password rules
• Employee data & financial security training.
• Employee Turn-over shut offs.

IV. Physical Security

Many Parcel and Freight Bill Auditors keep your company’ information on site, in servers or in file cabinets, so physical security also should be a consideration. From cameras and monitoring equipment to alarm systems and key-coded entries; having physical security in place can prevent a number of threats. As with virtual access, placing limits on who has access to your physical locations is crucial.

Parcel and Freight Bill Auditors handle large sums of money and sensitive information for their clients in the same way that medical and financial firms do. You should be sure your partners have all four security areas covered; Financial Controls, Personnel Security, IT Security, and Physical Security. They should hold themselves to the same stringent standards of security and protection standards of security as financial and health institutions; BirdDog does. We have the added protection and experienced staff to audit and pay our customer’s invoices efficiently, accurately, and most importantly securely.

The post Shipping Dollars & Data Security: 4 High Risk Areas appeared first on BirdDog Solutions.

The highlight of the two-day event was the presentation put on by Todd and Glenn where they discussed Parcel Shipping Optimization Best Practices with a very interested audience.  They were able to discuss their expertise on how to get the best rates for your parcel contracts and what elements are involved when planning your shipping strategy to meet business objectives.    They shared some real-life case studies on how BirdDog Solutions reduced shipping expenses for large volume shippers.  One example included how we were able to save a $7B public company 16% on their shipping expenses by focusing on the company’s parcel practices, more specifically their hundredweight usage.

Now that Operations Summit is behind us, we are eager to get to the IRCE show in Chicago.  We look forward to discussing how we can help you manage and reduce your shipping expenses with you in June!

The post 2013 Operations Summit Recap appeared first on BirdDog Solutions.

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Managing parcel shipping costs is a battle. Between unpredictable surcharges and pressures of global competition, effective parcel shipping contracts are crucial to controlling costs. Using a Request For Proposal (RFP) process to choose your parcel shipping vendor can help you decide which company aligns with your business objectives and strategies. An RFP is a bidding process for gathering comparable information about vendors. A critical tool for companies searching for vendors, RFPs can make it easier for companies to choose a parcel shipper that meets their needs.

Basics of the Request For Proposal (RFP)

An RFP is typically structured into four parts:

Introduction:
Explain in general terms why you’re putting out the RFP. Provide an overview of the subsequent sections of the RFP.

Company Background & Key Facts:
Provide vendors with detailed information about your company and what the purpose of the RFP is in relation to the goals of your business.  In some cases, presenting key facts and figures related to your current shipping initiatives is beneficial for the vendors to understand the baseline of the project.

Requirements:
Provide instructions to RFP respondents about the scope of service. Include a detailed list of what should be included in the response and how you would like responses formatted. Responses should contain an executive summary, vendor company information, specific questions aligned to your needs, scope of delivery, detailed pricing and, in some cases, references.

Selection:
Indicate a due date for responses. Explain what criteria will be used in making the selection. Provide a timeline to the vendors so that they know when to expect a final selection.

What to Ask:

There are basic questions specific to parcel shipping that should be asked in the RFP. The information you obtain should include:

Company Information

Asking about the company gives you a better understanding of who you may be partnered with in the future.  There is a wide range of companies who service parcel shippers and you want to be assured that the right candidate can handle the volume and service you require.  Some general questions that may be asked are:

• Ask for a description of their company and history.
• How many years has the company been in business?
• Are they independent or owned by a large corporation?
• How many employees do they currently have?
• How many clients do they currently service?
• What is the amount of their annual parcel transactions processed?
• Do they have a department dedicated solely to parcel contract optimization?
• If so, how many full time employees make up the department?
• What are their duties?
• What are their backgrounds, education, & training?
• Do they have audited financials?
• Have they filed for bankruptcy in the past seven years? Do they expect to file for bankruptcy in the near future?
• Describe all merger/acquisition/divestiture activity over the last 7 years.

Technology

These are questions around what technology does the vendor employ to make tracking, auditing and reporting easier for your company?

• What innovations relate to your small parcel services?
• Is their strategic direction specific to freight bill auditing, processing and payment services?
• Do they provide online access to data? How and for how long is data accessible?
• How detailed is the IT infrastructure;  what platform is it written in and where is it housed and maintained?
• How many full-time IT personnel do they employ?
• Do they have a dedicated Account Management or Customer Service Staff? How many other accounts will they manage?
  
• How many are employed in that department full time?
• Would we be assigned an account manager?
• Have them explain their Implementation Policy and the people involved in the start-up and ongoing management of a large scale program.  Include their backgrounds?
• Where does their company rank in terms of industry size?
• If you are awarded the business, what percent of their tracking volume would our data consume? 50% of what they would be tracking 25%?

Questions? call 1.800.464.3137 Ext. 3

Reporting & Analytics

For managing your shipping costs and customer service, be sure to ask about vendors’ reporting and auditing capabilities. Establish whether or not the vendor has audit and pay capability, and how extensive the capability is. Request details from the vendor:

• Is a shipping analytics program available by their company?
• If so, what information can be accessed?  Can data be exported?
• Can their program be customized?
• Is your program web based?  When was it last updated?  How is it supported?
• How long does it take them to create a new setup, rate structure and audit process? How do they audit service failures and verify that carrier service guarantees are met?
• What standard reports are available?
• What online report tools do they offer? Is there an extra charge for accessing it? Have them provide screen shots of their dashboards and report-lets.
• Have them explain the drill down capabilities of your system?  Does it go to the package level?

Security

Security is often overlooked in parcel shipping RFPs, but it’s an absolute necessity to protect you and your customers. Be sure to ask about the security controls the vendors have in place:

• What type of system controls and security do they employ? Physical location, and virtual
• Do they have a data backup plan?
• Do they have a disaster recovery plan?
• Do they have a third party security verification certification like SSAE16 (ISO 9000)

Using the Proposals to Narrow the Selection

You begin evaluating vendors before you send out the RFP, because RFPs are only sent to parcel shippers you’ve already partially vetted. Start by identifying a list of vendors who can meet your needs, eliminating those vendors that would waste your time to evaluate. Visit their website, download and read some of their whitepapers or articles. The RFP process is arduous for vendors, so only invite vendors you are certain you’d be comfortable contracting with. Use RFP responses to narrow the list further. Be sure to have others review the RFP responses to verify your findings. Keep VP or C level sponsors informed and up-to-date on the RFP process so you are not presenting them with different vendors when you have already narrowed your choices. They may want time to catch up to your thoughts and feelings on the vendors causing delay to your project.

Awarding the Contract

Awarding a contract should not be done on the basis of price alone. The purpose of the RFP is to allow you to compare more than just price; you can determine which vendor is capable of providing the overall best service for the price. The request for proposal process can seem arduous, but it can ensure that you end up with a partner who can become an extension of your team. Here at BirdDog, we help companies navigate the parcel shipping RFPprocess with ease. Let us know if we can help you!

How BirdDog Saves You Money On Your Shipping Costs

Parcel Program Design: BirdDog begins with your business strategy and develops a custom parcel program aligned to meet your key business objectives. We create industry specific solutions that deliver a competitive advantage by making recommendations on the modes, carriers, and services used. Examples include subsidized shipping analysis, DC site analysis, zone skipping, and comprehensive routing analysis.

Professional Services Team – Our professional services team of expert consultants and analysts have negotiated thousands of contracts from both the carrier and shippers perspectives. They are a team of Industrial Engineers with a combined 60+ years in network and operations management experience. They have expertise in Parcel, and Less Than Truckload shipping across US, Mexico, Canada, Europe, Asia, and Latin America. These consultants have had direct pricing management at a corporate level, global pricing responsibility, and major carrier product development, and Carrier Cost Model Development experience.

Contract Optimization – Your parcel contracts need to be aligned with your short and long term parcel program initiatives in mind. BirdDog’s Professional Services team is a uniquely qualified group of industrial engineers with carrier corporate pricing experience that deliver win-win agreements focused on eliminating expenses for the carriers and delivering bottom-line results for you.

Audit and Payment – Through advanced technology and our team of audit specialists, we process millions of invoices at a detail level each week. Most shippers don’t have the resources to check each and every invoice for accuracy. Duplicate invoices, misapplied Accessorials, incorrect rates; these are just a few of the budget sapping errors that BirdDog finds and corrects.

Analytics – BirdDog OnDemand — our proprietary technology platform — supplies 24/7 access to key metric reports, custom dashboards, and the ability to create your own customizable reports. These reports include in-depth analyses of your shipping activities with easy-to-understand tables and charts. We help you save time and make informed decisions.

Questions? call 1.800.464.3137 Ext. 3 or email sales@BirdDog.com

Get Started Saving on your Parcel and LTL Costs:

Free Savings Analysis Aberdeen Group’s Report Contact Us

The post How To Build a Request for Proposal for Parcel Shipping Optimization appeared first on BirdDog Solutions.

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How will 2013′s UPS and FedEx Accessorial charges impact your bottom line? Effective the first week of January, UPS and FedEx parcel rate increases hit invoices. While the announced increases were anticipated, it’s often the hidden costs of a parcel rate increase that wreak the most havoc with budgets.

To help shippers better understand the true impact of the 2013 parcel rate increases, we are continuing our Rate Impact Series, which is designed to help the industry identify hidden costs and determine how those costs will affect budgets. Read our analyses of the FedEx and UPS increases in Part One and Part Two of the series. In this quarter’s review, we analyze Accessorial charges. As always, BirdDog Solutions welcomes your feedback and suggestions!

Impact Overview

Impact Insight: Accessorial Charges Are the Norm, Not the Exception

Most people believe that Accessorial charges are a charge for services beyond normal pickup and delivery, including address correction and Large Package. However, the carrier strategy has shifted from traditional pricing based on total shipping cost to a thinking of surcharges and fees as an integral part of parcel shipping pricing. Accessorial charges are “hidden” costs of the parcel rate increases. With more than 10 pages of surcharge fees and scenarios from the two major carriers, it seems as though most parcels fall into the realm of Accessorial charges, which makes it very difficult to effectively manage the shipping budget. The most painful Accessorial charges include fuel surcharges, address corrections, Saturday delivery charges and handling charges. The biggest challenge with Accessorial charges is that they are often added after the fact, making it difficult to pass the charges along to customers. UPS has at least 68 surcharges and has increased 25 of them and FedEx has at least 65 surcharges and increased 18.

Some of the more surprising surcharges include the following:

UPS

• A $2.00 to $4.75 fee for providing delivery confirmation
• $15 fee for Saturday delivery
• $9.35 to $11.09 per 100 pounds for Inside delivery (beyond the dock), depending on whether or not the delivery person has to take the stairs or has access to an elevator for LTL shipments.

FedEx

• $8.50 Additional Handling
• A $2.15 delivery area surcharges for commercial
• A $12 fee for address corrections

Impact Insight: Residential & Delivery Area Surcharges Offset Anticipated Discounts

You cannot build your parcel shipping budget on anticipated discount rates without considering the costly impact of expanded residential and delivery area surcharges. Residential and delivery area surcharges are add-on charges assessed by FedEx and UPS to deliver packages to areas in congested metropolitan areas  or remote, sparsely populated or geographically difficult to access locations. These surcharges can do more than offset a rate discount; they can demolish discounts. For example, if you have a 20 percent rate discount with UPS in zone 4 and you’re shipping a one-pound ground package that incurs a $2.80 residential surcharge and a $2.75 delivery area surcharge, the net effective discount is -66.58 percent–more than double the budgeted discount rate. You actually end up paying more than the published rate.

Here are some examples:

Ground comparison

Air comparisons

UPS

FedEx

Impact Insight: Don’t Forget Prior Year Changes in DIM Weight Factors

We wanted to make sure that you kept an eye on one of the big changes UPS and FedEx have implemented in the last few years specifically dimensional (DIM) weight factors. For air packages, DIM factors used to be based on a threshold, but now they affect all air packages and more ground packages. To calculate dimensional weight, multiply length times width times height. Then divide that number by the DIM factor. Both UPS and FedEx changed their DIM factor from 194 to 166 in 2011. As any good mathematician will tell you, the lower the denominator is, the bigger the resulting quotient will be. In other words, a lower DIM factor means higher costs, sometimes significantly so.

Example:

Assume you are shipping a 12 x 24 x 18 package to zone 4 using ground shipping. The package weighs 27 pounds:

• 12 x 24 x 18 = 5,184
• 5,184 / 194 = 26.72, but 5,184/166 = 31.23

Changing the DIM factor increases the dim weight by 4.51 pounds. When rounded up, this creates a $2.03 increase in shipping costs (14.8 percent) per package. Do you know what your DIM factor is? Do you know what numbers of your packages are billed by DIM weight rather than actual weight?

Accessorial Charges – What You Can Do

Just because the new rates are published doesn’t mean you can’t negotiate a better contract with an eye toward addressing some of these charges. Many shippers don’t realize how much Accessorial charges, delivery surcharges and the DIM factor change will affect them; however, making room for a conversation about these changes in your parcel carrier negotiations can prove critical for your overall cost savings. Whether you negotiate to maintain the old DIM factor or negotiate a waiver for some of the surcharges, now is the time to consider what you can do to better control your parcel shipping costs going forward.

How BirdDog Saves You Money On Your Shipping Costs

Parcel Program Design: BirdDog begins with your business strategy and develops a custom parcel program aligned to meet your key business objectives. We create industry specific solutions that deliver a competitive advantage by making recommendations on the modes, carriers, and services used. Examples include subsidized shipping analysis, DC site analysis, zone skipping, and comprehensive routing analysis.

Professional Services Team – Our professional services team of expert consultants and analysts have negotiated thousands of contracts from both the carrier and shippers perspectives. They are a team of Industrial Engineers with a combined 60+ years in network and operations management experience. They have expertise in Parcel, and Less Than Truckload shipping across US, Mexico, Canada, Europe, Asia, and Latin America. These consultants have had direct pricing management at a corporate level, global pricing responsibility, and major carrier product development, and Carrier Cost Model Development experience.

Contract Optimization: Your parcel contracts need to be aligned with your short and long term parcel program initiatives in mind. BirdDog’s Professional Services team is a uniquely qualified group of industrial engineers with carrier corporate pricing experience that deliver win-win agreements focused on eliminating expenses for the carriers and delivering bottom-line results for you.

Audit and Payment: Through advanced technology and our team of audit specialists, we process millions of invoices at a detail level each week. Most shippers don’t have the resources to check each and every invoice for accuracy. Duplicate invoices, misapplied Accessorials, incorrect rates; these are just a few of the budget sapping errors that BirdDog finds and corrects.

Analytics: BirdDog OnDemand — our proprietary technology platform — supplies 24/7 access to key metric reports, custom dashboards, and the ability to create your own customizable reports. These reports include in-depth analyses of your shipping activities with easy-to-understand tables and charts. We help you save time and make informed decisions.

Questions? call 1.800.464.3137 Ext. 3 or email sales@BirdDog.com

Get Started Saving on your Parcel and LTL Costs:

Free Savings Analysis Aberdeen Group’s Report Contact Us

The post 2013 Parcel Rate Increase Series – Accessorial Charges & Fees appeared first on BirdDog Solutions.

Free Savings Analysis  Questions? Call Us: (800) 464-3137

Optimizing Through Parcel Zone Skipping
Shipping is expensive, and with the rising price of fuel, it is only going to keep going up. Freight accounts for approximately 11 percent of the cost of goods sold. This means that companies with lower freight costs can also provide their product at a more competitive price.

What Is Zone Skipping?
Parcel zone skipping, or zone jumping, is a frequently used option to get parcels delivered at the lowest possible cost. Zone skipping refers to the act of bypassing traditional small carrier zones by bulk shipping. Packages are shipped partway to their final destination by a shipper and dropped at a carrier hub, from which the delivery is completed.

Shipping rates are typically organized by zones, with zone 2 being the closest to the point of origin and zone 8 being the furthest. If your company is located on the East Coast and your customers are in California, they would be in zone 8. In this case, it may be economically feasible for you to utilize zone skipping, in which you would have a shipper take everything directly to a carrier hub in Southern California. The final delivery would then be completed by the carrier.

Is Zone Skipping Right for Your Company?
In order for zone skipping to be effective, several factors must be accounted for:

Pick-Up Density
This is perhaps the most important factor. In order to benefit from zone skipping, the shipper must be able to produce enough shipment volume to create full truck loads within a few days. If you cannot fill up at least one trailer a week, zone skipping is not a viable option.

Parcel Size
The more parcels you can load into a full truck load, the more cost-efficient the shipment will be. A truck load of large, bulky packages will contain fewer customer shipments than a truck filled with small compact boxes. If the majority of your shipment is large, lightweight packages, zone skipping may not be your best option.

Location
To truly benefit from zone skipping, your shipments need to cross multiple zones — and the more zones your shipments cross the better. If you are only shipping across one or two state borders, your shipping manager may be able to find better options for you.

Determining if Zone Skipping Will Work
Your shipping program manager should be able to help you determine if zone skipping will work for you. The shipping manager will look at the ground shipments from the last several months. He will look at their destination, weight and size to determine if there is sufficient traffic to a particular zone to warrant further investigation. If there are enough shipments to a particular zone, the shipping manager will look at viable drop points within the final zone.

Pros and Cons of Zone Skipping

PROs

• A company that regularly fills truckloads at a consistent rate can accurately predict final delivery dates.
• Zone skipping can reduce shipping costs, which may allow the company to offer their product at a more competitive rate.
• Improve time in transit based on destination
• Reduce damage potential due to less handles by the carrier

CONs

• If a company does not produce enough pick-up density, the customer delivery is delayed until the truck is filled.
• Time in transit may actually increase if not properly executed

If you think parcel zone skipping might work for you, contact BirdDog Solutions and we can analyze your shipping data and find out for sure if you can benefit from it

How BirdDog Saves You Money On Your Shipping Costs

Parcel Program Design: BirdDog begins with your business strategy and develops a custom parcel program aligned to meet your key business objectives. We create industry specific solutions that deliver a competitive advantage by making recommendations on the modes, carriers, and services used. Examples include subsidized shipping analysis, DC site analysis, zone skipping, and comprehensive routing analysis.

Professional Services Team – Our professional services team of expert consultants and analysts have negotiated thousands of contracts from both the carrier and shippers perspectives. They are a team of Industrial Engineers with a combined 60+ years in network and operations management experience. They have expertise in Parcel, and Less Than Truckload shipping across US, Mexico, Canada, Europe, Asia, and Latin America. These consultants have had direct pricing management at a corporate level, global pricing responsibility, and major carrier product development, and Carrier Cost Model Development experience.

Contract Optimization: Your parcel contracts need to be aligned with your short and long term parcel program initiatives in mind. BirdDog’s Professional Services team is a uniquely qualified group of industrial engineers with carrier corporate pricing experience that deliver win-win agreements focused on eliminating expenses for the carriers and delivering bottom-line results for you.

Audit and Payment: Through advanced technology and our team of audit specialists, we process millions of invoices at a detail level each week. Most shippers don’t have the resources to check each and every invoice for accuracy. Duplicate invoices, misapplied accessorials, incorrect rates; these are just a few of the budget sapping errors that BirdDog finds and corrects.

Analytics: BirdDog OnDemand — our proprietary technology platform — supplies 24/7 access to key metric reports, custom dashboards, and the ability to create your own customizable reports. These reports include in-depth analyses of your shipping activities with easy-to-understand tables and charts. We help you save time and make informed decisions.

Questions? call 1.800.464.3137 Ext. 3 or email sales@BirdDog.com

Get Started Saving on your Parcel and LTL Costs:

Free Savings Analysis Aberdeen Group’s Report Contact Us

The post Parcel Zone Skipping appeared first on BirdDog Solutions.