91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
More money for student services with this easy
saving opportunity
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Agenda
OBJECTIVES: 1. Present the concept and benefits of managing your inbound shipping costs.2. Demonstrate it is easier than you think to save money on your inbound shipping costs.
AGENDA: 1. What is the savings opportunity?2. What is the current state of inbound shipping?3. What is the solution?4. What is the savings potential?5. Results of recent NAEP survey6. Key to a Successful Program7. Build vs. Buy8. Partnership & ROI9. Next Steps10. Questions
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Doesn’t this say it all??
Hey Jason,
Join students all across America by making history on this Thursday March 1st, 3 PM at the Oval to protest tuition increases and student debt. Higher education is in crisis, student debt will reach totals over one trillion dollars this year nationwide.
Join students all across America by making history on this Thursday March 1st, 3 PM at the Oval to protest tuition increases and student debt. Higher education is in crisis, student debt will reach totals over one trillion dollars this year nationwide.
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Current State of Freight Management
Vendors in control
> 35% overcharge onsmall package
20% to 40% overcharge on LTL
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Invoice Overcharge ExampleShipping charge on vendor invoice = $29.04
Institution Savings $10.44
Shipping thru managed program = $18.60
36% Savings
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Here is the future that we need to move to!
“America’s public colleges and universities are being called on to restrain spending and to be more innovative and entrepreneurial in identifying and implementing cost containment and revenue enhancement measures.”
-- Public College and University Procurement Survey
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
How much can you save?
26,000 students over $50,000
13,000 students over $250,000
20,000 students over $120,000
6,700 students over $400,000
Note: Institutions with high research funding, or nursing, medical, engineering, and other hands-on areas of focus, have much higher shipping costs and savings.
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Results of Recent NAEP Survey
• 83% of respondents recognize shipping overcharges are an issue
• 50% want to address inbound shipping costs in 2012
• Primary focus is on initiatives with tangible savings, and high ROI
• More than 70% indicated a project with $100,000 or less of savings helps achieve goals
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Take Control!
“It doesn’t matter if the savings is $500, $5,000 or $50,000… managing inbound freight is an easy initiative to save money, and it puts us in control of our own costs.”
Stephen Storck, Senior Associate VP, Finance & Admin - Kent State University
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
What’s the Solution?
1. Take control of your own costs
2. Identify proven methods and best practices
3. Use experience of other industries
4. Use technology to youradvantage
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
What are the Keys to a Successful Program?
Vendor setup
Vendor compliance
Charge match to proper GL
Strategic reportingLong term focus
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Evolutionary process to maximize savings
OutboundAdditionalVendors
Exposure ofAssessorial
Fees
Less-than-Truckload
(LTL)
|-------------------- Strategic Visibility ----------------|
StrategicContract
Negotiation
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Decision Time – Build vs. Buy
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Common Pitfalls
More than a routing guide
Scarce IT resources
Making it harder on AP
Hoping and praying vendors comply
Not staying focused on program
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
What do you want in a partner?
Aligned incentives
Experience
Best practices
Complete management
Technology
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Partnership – Huge ROI
1. Maximum investment expected2. Average industry rates
Resources Hours Invested (1) Hourly Rate(2) Total InvestmentReport Writing 10 $50 $500 Accounts Payable 4 $40 $160 Project Champion 8 $60 $480 Total Investment 22 - $1,140
1 2Annual Inbound Shipping Expense $150,000 $315,000 One Time Investment $1,140 $1,140 Annual Recurrent Savings $52,500 $110,250
Return on Investment 4,605% 9,671%
Return on InvestmentInstitution
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Why do this now???
U.S. Secretary of Education Arne Duncan has warned of an ominous "New Normal" for public schools. This era of sky-high deficits and fiscal
austerity for states and school districts threatens our ability to achieve better outcomes
for all students, particularly the most vulnerable. That leaves us no choice but to
work together and spend smarter. Huffington Post 5/21/11
“Shrinking Budgets Demand Smarter Schools”We need to help our students succeed
It fits in with other priorities
Start saving this year
It’s easy to do
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Next Steps
• Identify if you want to “build or buy”
• Identify current shipping costs
• Estimate your savings
• Implement a program
• Monitor and report on success
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
Summary
• You are being overcharged on shipping costs
• Proven solution• Easy – fits in with other priorities• High ROI• Recurring savings• Future, strategic saving
opportunities• Recognize savings this year!
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
91st Annual Meeting & ExpositionApril 1 – 4, 2012
Anaheim, California
VPL thanks you for the opportunity to present at the
2012 NAEP Conference.