Key challenges
Limited visibility and influence: Our client grappled with minimal visibility and influence in their logistics operations, with legacy Logistics Service Providers (LSPs) holding a significant portion of the transport intellectual property. This hindered client's ability to have a comprehensive understanding and control over their transportation network.
Adapting to service offering changes: Anticipating upcoming changes to customer service offerings, the client recognized the need for subject matter expertise and a best practice routing system. The absence of these tools hindered their ability to draw insights crucial for informing a new route-to-market strategy, a necessity in the evolving landscape of their business.
Our approach
The client engaged TMX to lead a route optimization project for one of their major eastern-sea-board states. Having not conducted a detailed route review in years, they had limited knowledge of their dedicated transport task. Here is what TMX delivered for the client:
- Advanced technology implementation: TMX leveraged best-of-breed technology for route calibration and optimization modeling, identifying significant opportunities for improvement. This advanced technological approach allowed for a thorough analysis of the transportation network.
- Identified substantial benefits: Through the project, TMX identified approximately AUD$3.7 million to AUD$3.9 million (20%+) in benefits, showcasing the tangible impact of the route optimization initiative.
In addition, TMX identified the need to extend the review to other states and formulate an optimal operating model.
The results
Our client experienced significant advantages through the optimized baseline:
- Benefits of approximately AUD$1.7 million, optimizing both price and performance.
- Additional benefit of circa AUD~$2.2 million were identified upon implementation of alternative scenarios, further enhancing overall gains for the client.