GTM Case Study: How a Fortune 500 CPG Company Saved $12M by Reexamining Its Ocean Spending

When transportation and commodity costs rise like they did from 2006 through 2008, many companies examine their logistics spending to look for ways to save money.

Should they switch carriers? Should they find alternative sources closer to home? Are carriers actually charging the agreed-upon rates?

But when these same costs fall, there’s temptation to relax these cost savings efforts.

Companies incorrectly assume that because transportation costs are so low, it’s not worth their time to examine rates and compliance, thinking the savings won’t justify the effort.

But this couldn’t be more wrong. One Fortune 500 consumer packaged goods (CPG) company saved nearly $12M on over $100M in ocean transportation spending through good times and bad by using the Freight Contracting and Ocean Visibility modules from GT Nexus.

The company blew away expectations for the project, achieving its five-year goals in less than a year:

• Optimized spend—In the past, the company managed procurement in Excel spreadsheets, which didn’t allow for optimization scenario planning and whatif analysis. The company can now make better sourcing decisions.
• Greater contract compliance—Before, the manufacturer had little visibility into its worldwide business units to see if they were using preferred carriers and benefiting from pre-negotiated rates. Now it can.