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Parcel Advisory Case Study

$22,300,000
Customer Annual Net Spend in Parcel
$2.2M
10.1% Cost Reduction Communicated Pre-Engagement
$3M
13.6% Cost Reduction Realized Post-Engagement

A major American multinational clothing company with significant storefront and e-commerce business had a strong business relationship with the carrier. They had always handled the negotiations internally and finalized savings during each process. They were being held accountable to reduce spend and understood that since they had substantial costs within their parcel shipping, this could be a rewarding area to focus on. The company utilizes all services offered by the carrier, with 41% of the shipping revenue tied to Ground Commercial and 28% tied to International.

We learned of the company’s growth plans and need to develop a carrier pricing agreement that would benefit them for the next three years. We were able to secure a very favorable pricing agreement with the opportunity to achieve additional savings via a rebate as they moved business into the parcel mode. The largest challenge was that the carrier knew the client was loyal and really had no interest in moving to the non-incumbent. We had to create a more intense level of uncertainty by incorporating attention from sources higher than the regular contacts the carrier was used to dealing with.

The outcome proved to be very beneficial, achieving savings 3.5% above projection.

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