CONVOY Shipper Story: Taming tough lanes and saving on costs with a Fortune 50 retailer
Company Size
1,000+
Region
- America
Country
- United States
Product
- Convoy Guaranteed Primary
Tech Stack
- Not mentioned
Implementation Scale
- Enterprise-wide Deployment
Impact Metrics
- Cost Savings
- Productivity Improvements
Technology Category
- Application Infrastructure & Middleware - Data Exchange & Integration
Applicable Industries
- Retail
Applicable Functions
- Logistics & Transportation
Use Cases
- Fleet Management
- Supply Chain Visibility
Services
- System Integration
About The Customer
The customer is a Fortune 50 general retailer with nearly 50 supply chain facilities and 2,000 stores across the United States. The retailer is continuously seeking ways to optimize and innovate their freight operations across vendor to distribution center routes. The retailer's operations teams found themselves facing waves of canceled shipments as demand for freight spiked in 2021. Goods were flying off shelves, including consumer favorites that were high-visibility and high-volume. Many carriers were unable to fulfill spiking volumes well above committed contract volumes. Increased volume hit the spot market as a result. Underperforming lanes remained business critical, but drove up operating costs, and reliable capacity was needed to support peak retail seasons.
The Challenge
The Fortune 50 general retailer, with nearly 50 supply chain facilities and 2,000 stores across the United States, was facing challenges in optimizing and innovating their freight operations across vendor to distribution center routes. The retailer was experiencing waves of canceled shipments due to a spike in freight demand in 2021. Many carriers were unable to fulfill the increasing volumes well above committed contract volumes, leading to increased volume hitting the spot market. This resulted in underperforming lanes that remained business critical, but drove up operating costs. Reliable capacity was needed to support peak retail seasons.
The Solution
Convoy, which was already delivering 100% of contracted volume with the retailer, was chosen to pilot the Guaranteed Primary program when spikes in volume required even more flexible and reliable capacity. During the pilot, Convoy guaranteed 100% tender acceptance at a fixed 10% margin across 7 out of 26 existing primary lanes. These lanes were experiencing high volume spikes and load cancellations/ tender rejections. Estimated savings through Guaranteed Primary rates were estimated at $1.6 million when compared to standard RFP contract rates at the time. Within three months, Convoy was able to improve total primary tender acceptance by 88% on the seven lanes chosen for the pilot. While tender rejections increased 105% the month prior to the pilot, the Guaranteed Primary program delivered on its 100% tender acceptance promise, leading to zero spot loads.
Operational Impact
Quantitative Benefit
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