1. Addressing the “Capacity Crunch” Health and Personal Logistics Conference
By Curt Metzler

2. Transportation Capacity
The driver shortage is real
It is a key factor in the tightening capacity situation
There is no near term fix
The industry will be forced to pay more
Higher costs will be reflected in pricing
“Service on demand” is a luxury of the past
72 hours advance notification is the new norm
Planning and communication with carriers is critical
At the same time, trucking activity has risen 4.1 percent from 658 million loads in 2013 to 685 million this year, according to FTR. - See more at:
Source:
Don Ake, FTR Vice President of Commercial Vehicles, commented “The trailer market remains very vibrant. The van OEM’s are finishing up filling Q3 production. Many Q3 orders remain speculative, but fleets are optimistic about Cancellations were up, but that often happens at the beginning of the year when fleets take a closer look at their requirements. With backlogs very high, order patterns should start to follow a more traditional pattern."
Source:
"Next, capacity is finally being added to the marketplace just when the HOS rollback is being implemented. Truck ordering activity at the major builders hit 375,000 units in 2015, well above the 295,000 units that they actually produced. Those units will spill over into 2015 as carriers add or replace the trucks in their fleets. Lastly, spot market data from truckstop.com highlights that the market has returned to normal this year following a very capacity-constrained winter and spring in That will make year-over-year comparisons look much worse until late in the year. Despite these worries, the market is still running pretty tight and economic growth is anticipated to stay at a solid pace. Look for truckers to be hit by both headwinds and tailwinds during 2015 but be able to stay the course.”
Source:
FTR reports December U.S. Trailer net orders at 45,500, the second highest month ever recorded, just 1.5% below October, Trailer orders for 2014 totaled over 360,000, by far the best order year ever.
Source:

3. How Capacity is Affecting Alcon
Scope:
Manufacturing Yard and Dock Congestion
Utilizing 400+ trailers and 100+ ocean containers between distribution centers, manufacturing, and local carriers
Objectives:
Reduce overall costs associated with detention charges
Improve trailer visibility and management of assets across functional units
Optimize inbound/outbound process through Cross Dock
Projects:
YMS Optimization
Cross Dock Initiative
With the above economic trends in motion it is more important than ever for Alcon to improve efficiency and collaboration both within the company and with carriers and suppliers
Alcon's solutions to these economic issues involve decreasing costs while improving efficiencies.

4. Project: Yard Management System (YMS)
Objectives of Project:
Map entire local trailer network to provide visibility
Reduce detention and rental payment charges by 50%
Optimize information exchange between functional departments
Increase inventory visibility
Optimize trailer pull process
Identified yard management as an area of cost savings for Alcon
Provides opportunity for further inter and intracompany integration

5. Real-Time Data…
Confidential
Patented real-time location technology collects and combines feeds in the cloud from multiple sensor types “Meaningful” Internet-of-Things Sensor Network uses our patented location technology, making it the most accurate available
RFID
Plant
GPS
Yard
Telematics
Cellphone
Road
Vehicle

6. Operational Challenges
Confidential
High Detention or Demurrage Charges
Poor Asset Utilization
High Safety Stock Levels
Inefficient Operations
High Driver Wait Times
Poor Collaboration
Lack of Empty Trailers on hand
Lost or Misplaced Trailers

7. Advanced Yard Management Operations
Confidential
Scan Tag at Gate
Affix Temp Tag to Inbound Trailer
Yard Truck with touch-screen Computer Reads Tags
Trailer Locations Captured and displayed in application

8. Visual Map Of Facility with Trailer Status
Confidential
GPS based mapping displays accurate location and status of assets in the yard.

9. Gate Guard – Web Gate View
Confidential
Unleashes the check-in / check-out process from the pc at the gate to browser capable devices with internet access anywhere
Full support for sites with shipments enabled
RFID tag read support for gates with fixed external readers and / or internal readers for temporary RFID asset tagging

10. Whiteboard for Dock Door / Trailer Status
Confidential
Whiteboard View
Shows dock doors
Configurable attributes displayed
Initiate moves directly
Whiteboard is a very powerful tool providing visual status at a glance and enabling move generation and tracking in the same screen

11. Advanced Features and Reporting
Confidential
100+ Standard KPI reports
Custom reports
Scheduled
Exportable
In addition to reporting in the system, clients can set up automated alerts and schedule transmittal of System and Custom Reports

12. Platform Designed for Collaboration & Insight
Confidential
Allowing carriers to manage appointments & assets online
Schedule Appointments
Streamlines communication
View status of their assets
Automate carrier dispatch to avoid demurrage/detention costs
Repository for yard analytics
Shipment arrivals & departures
Driver Idle Time
Spotter & Dock Door Efficiency
Trailer Utilization
Inventory

13. Operational Transparency Across Facilities
Confidential
Enterprise Visibility Suite
Yard Management System
Advanced YMS
Advanced YMS
Yard Management System
Supplier 1
Customer DC 7016

14. Recognized Customer Value
Confidential
30%
30%
20%
20%
10%
10%
90%
50%
40%
30%
30%
10%

15. Project: Yard Management System (YMS) Expected Benefits
Improve intercompany visibility
Increase process control
Free up carrier assets
Increase carrier pooll
I am assuming the cost of system and integration at divided by 12 months based on contract starting in April, initial fee of 1500 for salaries involved in prep work and meeting time
Savings based on sliding scale of time required to see benefits. Total costs per year estimated at 4.6 million.
Lines represent cumulative savings and costs over time
Would recommend providing graph of information regarding the benefits felt from this initiative since December

16. Project: Export Cross Dock
Objectives of Project:
Cost Savings of ocean container per diem (fuel, demurrage, drop and pick charges)
Free up valuable Manufacturing dock space
Cycle time improvement
Alcon campus ocean container free
Improved ocean container utilization
FTZ duty reduction for imports
Got information from cross dock proposal
Objectives of the project are to decrease costs by improving organization and information

17. Project: Cross Dock Realized Benefits
Order wait time reduced
Optimized process flow
2.3% reduction in FTW ocean spend
Improved container utilization
Reduced demurrage
Approx. 45,000 USD in cumulative net savings since December
Minimization of storage and capacity risk due to product growth
Reduction in container re-work
Got financial numbers and some other benefits from the cross dock proposal PowerPoint. I divided the total savings by 36 then multiplied by 3 to get cumulative net savings since December

18. Projects: Cross Dock and Yard Management System Cumulative Project Benefit Projection
Higher visibility and control over operations
Enhanced communication between functional groups
Real time information
Increased independence
Assumed start of YMS in April
Assumed projected savings from both projects
Assumed contract payments of equal value over a year starting in April
Used cross dock approx savings per month to calculate