In this article, we will recommend our no-nonsense approach to measuring ROI and share how Cargobase generates ROI for shippers.
It is essential to analyse the potential Return on Investment (ROI) of your TMS (or lack of one), as this system is critical to the movement of goods from A to B, on time! And we all know that the failure of such goods to be delivered on time comes with additional costs and lost revenues.
In this article, we will recommend our no-nonsense approach to measuring ROI and share how Cargobase generates ROI for shippers.
Cargobase takes a pragmatic and transparent approach to calculating the ROI for a TMS. In line with this philosophy, we do not charge any upfront implementation fees, nor support fees or any other costs that catch you off-guard. You are only charged monthly running fees and therefore have an immediate payback. Here's the Cargobase approach - let's look at the below framework taking the left side first, i.e your cost base.
The typical cost base of your logistics operation has three main components:
A common challenge for many logistic teams is the lack of complete visibility on their spending with the logistics service providers (LSP) - one of the reasons to implement a TMS in the first place - data ownership and less reliance on LSP data.
On average, companies achieve a 27% cost saving on spot-buy freight through the Cargobase platform, and shippers benet from more quotes and faster response times on their spot-buy shipments.
The logistics team will benefit from improved visibility, eciency, and, ultimately, higher productivity. Time and motion studies during pilots with our customers show that up to 80% of their time can be saved by working on the Cargobase platform and eliminating excess emails, WhatsApp and phone calls, as well as reducing unnecessary duplication of work and time-intensive reporting. With the platform being user-friendly and highly intuitive, onboarding is simple and new team members can be eective from day one.
Having all operational data in real-time in one system gives shippers consolidated insight into the performance of their LSPs through better root cause analysis and corrective action planning. Shippers can easily benchmark LSPs against their peers and partner with a pool of providers that truly add value to their business.
Typically TMS providers have the following price components:
There is an elephant in the room and that is the cost of a failed implementation. Many TMS solutions are so complex that there is a wide gap between what these systems can do, and what your team actually needs (the ‘consumption gap') This complexity not only increases the cost of the product, it also adds to the chance of failure. Just think about how much it will cost to your organization if you have to decide after a year to terminate the implementation. At Cargobase, we have seen countless cases where multi-year, multi-million TMS implementations were ultimately abandoned, the pain is real.
Let's get you ready to pull the ROI levers. Schedule a consultation here.