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Reducing Transportation Spend by 37% through Strategic Sourcing

Case Study Summary

Based on the economic climate, an over-the-counter (OTC) / consumer division of a global pharmaceutical company was interested in locking in transportation rates. As the client had limited experience with sourcing transportation, the company engaged Archstone to review their current transportation suppliers and identify opportunities for savings.

The Client

OTC consumer division of a global pharmaceutical company.

The Challenge

Reduce transportation costs through spend analysis and sourcing activities; improve the client's North America Outbound Logistics spend; analyze line haul, carrier related accessories, charge-backs / surcharges, billing errors etc.

The Solution

Archstone assessed the current transportation environment, collecting data and developing a baseline and evaluating current and potential suppliers. Working with the client, Archstone evaluated sourcing opportunities by defining transportation requirements and evaluating opportunities highlighted in the spend analysis. The team then supported the client throughout the lifecycle of the RFP process:

  • Creating the RFP with robust shipment history
  • Conducting the bidding and evaluating the results based on savings models with multiple scenarios
  • Negotiating with the suppliers and developing contracts / routing guide
  • Drive day-to-day execution of the process

The Results

As a result of Archstone's efforts, the client was able to achieve a savings of $4.8M (37% of baseline transportation spend).

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