In previous posts I discussed basic logistics KPI’s such as % of on time delivery, warehouse fill rates, and loss/damage experience. KPI’s are essential to the management of logistics providers as well as their clients. Some customer service functions, however, are not as easy to measure. Clients of logistics providers include shippers, consignees, importers, and exporters. Whether your logistics provider is a motor carrier, freight forwarder, customs broker, or warehouse company, you will need customer service assistance from time to time. Let’s differentiate:

Request for Information– shipment status, tracking and tracing, claims status, rate requests, invoice balance. This type of customer service is best obtained on line. Take the time to become familiar with your providers’ info systems so you don’t waste time on the phone or waiting for a call back. If your provider does not offer this type of info on line they are either inefficient or very small. To avoid frustration ask yourself if you just need information or action by your provider. Information is easier to get than action.

Action Needed- This level of customer service most likely requires human intervention. Examples include customs or regulatory delays, stopping or diverting shipments, credit issues, special pricing, or real emergencies. While no one likes calling an 800 number, it is a good idea to get your request into the provider’s system as soon as possible as a first step. The difficulty is in reaching the right contact and getting the action you need. If you use a 3PL you may be able to delegate the problem for their handling and have them provide timely updates. If you do not use a 3PL, then you need to manage the issue on your own. One mistake clients make is to rely on their  account rep for all customer service. Account reps are usually on the road and in meetings so this causes delays in action. Another mistake is to depend on the super efficient Mary, Debbie, Tom, or Bill in your provider’s office. Everyone takes vacations and sick days so don’t rely on one person for your customer service needs. A better way to get good customer service is to establish protocols with the help of your providers.

Protocols- Day to day logistics consists of planning, execution, and problem solving. Good planning is essential but not foolproof. Logistics managers deal with changing schedules, equipment failures, weather delays, regulatory issues, and miscommunication on a daily basis. Most problems, however, are not new. The same situations tend to repeat themselves so they can be anticipated. I suggest developing a set of problem solving protocols for the most common issues in your supply chain. This approach will save you time since you will not be starting from scratch when a problem arises. It will also enable your colleagues to act in your absence. A basic protocol defines the problem and lists steps to be followed as well as the resources involved. Your logistics providers can help by providing resources. They should be willing and able to give you relevant operations contacts along with phone and e mail info for your identified problem areas. Your account rep may be surprised when you ask for help developing protocols but they should welcome the opportunity. This method can be a big time saver for them as well. Get commitment from your providers to respond to your requests in an agreed to amount of time. You can update the protocols as needed. Make protocols a part of your meetings with your account reps and you will get better customer service.

Finally, if your account rep says “Just call me”, don’t accept this response.

We help small and medium sized companies stay compliant with Customs and export regulations and manage logistics. Contact mitch@52.91.45.227

Are you thinking about taking the Customs Brokers Exam? If so think about baseball or something pleasant until the urge passes. The exam is given in April and October. Next exam date is October 6, 2014 and registration will open on the CBP website in July.  The brokers exam has proven to be more difficult to pass than the bar exam. Typical passing rates range from 3-11% nationally. Results have not yet been posted for the April 2014 exam but the passing rate for October 2013 was 11%. If you plan to take the October exam my advice is to start preparing now. I described the techniques that worked for me in a November 2013 post archived under “Nuts and Bolts”.

Contact Ad Hoc Logistics for help with logistics or regulatory issues  

http://www.cbp.gov/trade/broker/exam/announcement

I am well organized but I did pick up some new techniques at a Southern New Hampshire University seminar on 6/10. The seminar was “Managing Multiple Priorities and Projects” (National Seminars Training) and the presenter was Laura Simms of ProfessorDoctorMom LLC.

My background includes stints as a corporate trainer and training supervisor so I know good training when I see it. This was definitely good training. Laura is dynamic, knowledgeable, and thorough. Some of the topics covered were: Fast planning, establishing priorities, time management, and Outlook tips. Highly recommended.

Contact me for help with export compliance, customs issues, or to analyze your logistics costs.

Mitch Kostoulakos commented on a discussion in Logistics Consulting.

Adam Robinson If you had only ONE thing to tell a shipper to reduce overall costs, what would it be?

Curious to hear from those who ship freight what one piece of advice they would give a new logistics manager to reduce OVERALL costs (more than just beating down carriers for rates).

In a recent post I discussed the World Bank Logistics Performance Index for 2014. Here is a follow up which includes the index for the years 2007, 2010, 2012 and 2014. The rankings indicate that the US lags behind EU trading partners as well as Hong Kong, Singapore, and Japan. Lowest scores are in the areas of  Customs Clearance and Ease of International Shipments. US ranks fairly high in Infrastructure which is surprising.

The category Ease of Shipments refers to the ease of arranging international shipments.  Ad Hoc Logistics can handle the quoting, documentation, and follow up of international shipments  for your company. Contact mitch@52.91.45.227 for a free initial consultation.

International_LPI_from_2007_to_2014

I came across the term “wicked problem” in the text that I am using for my SNHU course International Supply Chain Management.* A wicked problem involves multiple stakeholders, each with different interests and values. As a result there is no single common goal , no clear mission, and no universal solution. Any solution, after being implemented, will generate waves of consequences and can result in making the problem worse.  A suggested framework for tackling a wicked problem consists of 4 levels of increasing complexity:

Level 4- the Macro Environment- This level uses PEST  (Political, Economic, Social, and Technological) analysis of environmental changes. Issues include green and legal/regulatory as well as geo political factors.

Fortunately, not all logistics problems are wicked problems. If you need help with international logistics contact Ad Hoc Logistics.

The World Bank has posted their Logistics Performance Index for 2014. The index benchmarks 6 areas of performance and gives nations a score from 1-5 for each area. The benchmarks are 1) Efficiency of customs clearance process, 2) Quality of trade related infrastructure,  3) Ease of arranging competitive pricing for shipments,  4) Competence and quality of logistics services,  5) Ability to track and trace shipments,  and 6) Timeliness of shipments in reaching destination within scheduled time of arrival.

For 2014 the US ranks 9th overall with an average score of 3.92 for the 6 benchmarks. Surprisingly, the highest US score is 4.18 for infrastructure, and the lowest is 3.73 for customs clearance.

The 8 nations ranking higher than the US are:

Germany

Netherlands

Belgium

United Kingdom

Singapore

Sweden

Norway

Luxembourg

Details @

http://lpi.worldbank.org/international/global/2014

Need help with logistics? Contact mitch@52.91.45.227 for a complementary consultation.

In the years that I have taught Supply Chain courses, many students have expressed the desire to start their own importing or exporting business. In some cases they were motivated by an interest in a particular product they encountered on an international trip. Others wanted to turn a hobby into a business. In these early stages the nuts and bolts of international logistics are less important than the product, the markets, and realistic expectations on the part of the student. As an instructor I always want to provide guidance and assistance along with real world business facts. The attached Twenty Questions are a good way to start the process,

IS THIS BUSINESS FOR YOU

Transportation mode and carrier selection always involves tradeoffs between cost and service. It is helpful to understand the relationship between variable costs and rates. Here is a link to a Transportation Carrier Matrix that I have used in supply chain classes. It is a snapshot view of the various modes by industry type, operating costs, rates, services, and markets.

TRANSPORTATION CARRIER MATRIX

Reverse logistics programs are fast becoming a major requirement in 3PL and procurement contracts. Not long ago “returns” were considered a nuisance by manufacturers, retailers, and logistics providers. They were handled only as a courtesy to customers. Today, environmental legislation is forcing companies to take responsibility for waste. At the same time consumers expect clear and efficient returns programs when making purchases. The EU is leading the way on reverse logistics with strong legislation and policies. In the US reverse logistics is evolving as progressive companies realize the opportunities to enhance their public image, lower operating costs, and improve productivity. In other words reverse logistics is moving from an added cost “returns” program to a value add process. Here are some recovery options in reverse logistics*

• Reuse– inspect, clean, and use again for identical or similar purpose, value add
• Remanufacturing– dismantle and reassemble or use for parts, value add in remanufacturing w/improvements
• Recycle– sorting process for scrap, no real value add but can recover some costs

While the above  is good business practice it is difficult to plan and execute from a logistics point of view. One reason for this is uncertainty in timing and quantity of returns. Product life cycle and rate of technological innovation play a big role in timing of returns.

Successful reverse logistics implementation involves both external and internal factors. External factors include legislation, customer demand, and incentive. Internal factors include environmental concerns, strategic cost/benefits, volume and quality of returns, resources utilized, and integration and coordination.

• Customer demand– environmental responsibility is becoming a competitive necessity
• Incentive– companies need to make returns worth it for end users
• Environmental concerns– growing trend, not optional going forward
• Strategic cost/benefit– can help increase sales and asset utilization but will increase costs. Benefit is mostly long run after initial investments in equipment, design, process, and labor.
• Volume and quality– returns must be managed to avoid scrap as much as possible
• Resources– use available resources and assets as much as possible
• Integration and coordination– must use info systems to gain competencies in recovery so reverse logistics does not become a profit drain but a profit center
• Performance measures– forward logistics measures are not adequate for return logistics. Need to develop different metrics for return logistics. Ex: time required for product recovery, % recyclable/reusable at end of product life, core return rate, % product weight or volume disposed in landfills

*Global Logistics and Supply Chain Mgt by Mangan, Lalwani, Butcher, and Javadpour, 2nd Ed, John Wiley & Sons, 2012