In its second-largest acquisition, Amazon buys the company for $970 million.
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“A unique value proposition of multi-tenant on-demand transportation management systems is their network of already connected transportation carrier and freight forwarders,” Enslow says.
Modern web technology-based transportation management systems are also providing advanced visibility into truck movements and greater opportunities for collaboration between retailers and carriers. The systems provide improved visibility through alerts sent from carriers about the status of truck movements, including any disruptions. If a truck loaded with blue jeans breaks down on its way to a distribution center in Iowa, for example, a manager would receive an alert via e-mail or cell phone, then could log on to a web-based transportation management application to arrange for an alternate carrier. On the other hand, if the retailer realized that demand for products already en route were needed by a different group of stores than originally planned, the transportation manager could log into the system to redirect the shipment to a different distribution center.
“There are a number of major advantages that may be gained by using automated transportation planning software, such as visibility to inbound volume, fleet capacity management and cost efficiencies,” Rite Aid’s Shovel says.
Before using the Manhattan Associates system, Rite Aid’s suppliers controlled most of its inbound transportation, the trucks headed to its distribution centers. That left Rite Aid’s transportation department with limited visibility into which purchase orders suppliers were filling, as well as limited awareness of shipment status of orders being filled.
Shippers generally alerted Rite Aid only when a shipment became delayed in transit, leaving the retailer little time to react and arrange for an alternate carrier or replacement products to fill store shelves. While transportation managers scrambled to make alternate plans, the disruptions forced Rite Aid’s inventory managers to process emergency orders from stores instead of spending time on their usual inventory planning.
With the Manhattan Associates Transportation Planning and Execution system, Rite Aid’s transportation management team logs onto the web to match submitted purchase orders with shipment readiness at suppliers. After viewing and analyzing the intended point of delivery, volume, expected transit time and available carriers, Rite Aid then chooses a carrier based on its available capacity, expected delivery time and costs. After it chooses a carrier (or truck from its own fleet) it receives status reports in alerts sent by drivers and carrier partners to the Transportation Planning and Execution application as well as to cell phones and e-mail inboxes.
Several recent acquisitions and product introductions in the transportation management market have produced more options for retailers.
While RedPrairie’s domestic transportation management software is offered in an on-demand version by Shippers Commonwealth, RedPrairie also recently introduced on-demand versions of its international and internal fleet transportation management applications, says Dan Vertachnik, senior vice president of the Global Transportation Group at RedPrairie.
Among other providers, Sterling Commerce last year acquired Nistevo, a provider of on-demand transportation management software that provides access to about 6,400 carriers. Infor recently introduced an application, Infor Supply Chain Visibility, that provides visibility across supply chain and inventory management applications, says Eric Nilsson, vice president of product management.
Thanks to the expansion of web technology integration connecting transportation management to related applications, on-demand transportation management can create new efficiencies in preparing loads for trucks. Integrated with a warehouse management system, for example, the on-demand transportation application can be configured to automatically determine when an order, based on the number and dimensions of products, should be sent via small-parcel, less-than-truckload or full-truckload, then print out the pertinent shipping labels for the appropriate carrier.
The improved integration among transportation and other applications is making it easier for retailers to take a more comprehensive look at their logistics operations, experts say. “A lot of people have traditionally talked about inbound and outbound (from distribution centers to stores) as different silos,” says Prashant Bhatia, senior director of product management for Manhattan Associates. “But really transportation management should look at the transportation network as a whole to optimize the network from suppliers through DCs to stores.”