Inability to Tightly Control Transportation Costs Cited as Biggest Problem by Transportation Execs

HILLIARD, Ohio, Sept. 20, 2011 /PRNewswire/ -- Insource Spend Management Group, a leading provider of spend management solutions, conducted an analysis of parcel shipping spending at Fortune 500 companies and found billions in overspend on shipping services across the industry.  Additionally, in a recent report Aberdeen Group(1) noted that transportation cost relative to overall supply chain performance is the top pressure cited by 57% of transportation executives. In response, over 53% of survey respondents are seeking to gain better visibility to costs.

The Aberdeen whitepaper, "Integrated Transportation Management in a Capacity Constrained Global Market" is available free of charge from Aberdeen's website until September 30.  The report notes that the number one strategy for "best in class" companies to control overall transportation costs is renegotiating cost and service contracts with trading partners. As a result of proactive efforts, 91% of the "best in class" companies have reduced transportation spend year over year, compared with 49% of other companies.

"The problem with gaining visibility into cost for shipping is the lack of transparency in carrier contracts," said Brett Febus, Insource Spend Management President.  "For shippers, it's nearly impossible to know whether you are getting the best pricing and agreement terms from the parcel carriers. Industry analysis has proven that working with a third party negotiator on carrier contracts can obtain a 49% better discount than a company can get on its own(2). Going to the negotiating table on your own puts all the cards in the carrier's favor."

Insource helps clients improve profitability through smarter spend management.  Using a key combination of software analytics and expert negotiation, Insource has helped many of the largest shippers in the United States improve their existing UPS and FedEx agreements, including dozens of engagements with the Fortune 500.

About Insource

Insource Spend Management Group is a leading spend management provider that offers expertise in identifying savings opportunities in transportation, technology and telecom pricing agreements. The company has successfully renegotiated hundreds of pricing agreements by identifying additional savings opportunities, advising on how to make the smartest spending decisions and renegotiating optimal pricing agreements.  

Since 1999, Insource has saved its clients more than $1 billion by renegotiating carrier pricing contracts for hundreds of companies, including dozens of the Fortune 500.  For more information, visit www.insourceSMG.com or contact Insource at (800) 397-6880.

Contact: Ellen Teng, 614-876-0003
email: [email protected]

(1) Aberdeen Group, "Integrated Transportation in a Capacity Constrained Global Market," Bob Heaney, August 1, 2011

(2) Morgan Stanley, "Parcel Trends Revealed," Marli Thiede, 2006

SOURCE Insource Spend Management Group