Success Stories
GEFCO Germany: Good results with online marketplace at Cargoclix
The tendering of logistcs contracts on online marketplaces on the Internet is gaining more and more importance-especially for large logistics service providers and freight forwarding companies. After a preliminary test of the well-known logistics auction portals, based on definite criteria for quality, GEFCO Germany Ltd has ultimately decided to use the online marketplace, Cargoclix. GEFCO Germany Ltd - which is part of the worldwide GEFCO logistics firm - is represented in Germany by 17 regional offices and 20 branch offices of the GEFCO Cargo Concept Partners. Over 950 employees handle the smooth operation of 800 lines run daily by short-haul vehicles, 150 lines by long-haul trucks and 100 used in international traffic.
In May 2006 GEFCO Germany-Central for the first time began tendering proposals for a total of 166 national transport lines, as well as express lines crossing Germany via the online marketplace of Cargoclix. Dr. Alexander von Lieven, Corporate Development Manager of GEFCO and Head of Contract Tendering described the objective as follows: "By using Cargoclix we wanted to implement in our house and among our associates a centralized tendering procedure, to test, on the one hand, our purchasing terms, and on other hand this modern and efficient process of issuing contracts ". Indeed rather than resort to online tendering exclusively, GEFCO stipulated in advance that the online tendering should be backed up by a conventional tendering which would run parallel to it. "For we considered it only proper to invite our partners of many years personally to the awarding of bids, " said Dr. von Lieven, justifying the special process. The person in charge of the project summarizes his experience with this pilot tendering-from the design to the implementation all the way to the rating and the result of the tendering-with the words "altogether very good."
Transparency and broad spectrum of bidders
For GEFCO Germany, an important criterion for the selection of Cargoclix in comparison to its competitors was not only the good ratio of price to performance for Cargoclix service, but the transparency for bidders and purchasers during the entire tendering process. "I consider that the great advantage of Cargoclix is the fact that both sides profit from the very transparent form of online viewing during the entire bidding process, " he said, describing the criteria used for comparison. Moreover the references of well-known past customers and the past experience of the portal, "which after all is no longer a newcomer," he said, underlined his positive impressions. An additional criterion was the possibility of reaching a broad spectrum of companies by means of the tendering portal, for at this time, Cargoclix has at its disposal a network of over 10,500 registered users all over Europe. "In this way I can directly reach targeted groups, the very ones I want to reach," said Dr. Von Lieven.
Competent and flexible in Implementation
Even in cooperation with the Cargoclix team before, during and after a complex tendering proposal, there are plus-points to hand out. The Cargoclix principle: "one face to the customer" was the assurance for the GEFCO managerial staff of the simplicity and support in the practical implementation which he expects from a service provider in any case. "I had someone I could speak directly to as a partner, who was familiar with the project down to the slightest detail, and was accessible to me at any time. The competency of that expert was clear, not only in the correct and clearly laid out sketch of all details of the freight on the platform, but also in the development of good suggestions in the implementation and follow-up", said Dr. von Lieven, describing how the operation was carried out.
Efficient process for issuing contracts
On account of the special requirements of GEFCO to synchronize the online tendering with the conventional submission of the bid offline, an instrument was developed by Cargoclix, which assured integration of all bids on the online portal and transparency for all bidders in every phase when a deadline was approaching. "That meant a smooth data transfer, one that was always up-to-date, and we were very satisfied with the effective procedure," said those responsible for the project, evaluating the process. Time was saved even in the evaluation and the comparison of all bids, as well as the allocation to the individual regional offices. "The purely electronic form of data collection and preparation by Cargoclix makes possible various kinds of evaluation techniques, which is a significant advantage due to the saving of time and internal resources," said Dr. von Lieven. Moreover additional contacts could be finalized with new carriers able to do jobs for us, which could be concretely approached for future contracts and for long-term business relationships in the GEFCO network. "The tendering of our contracts with Cargoclix has been worthwhile for us in every respect," he asserted. With the ease of handling and the outsourcing of complex processes during the tendering and the awarding of the job through the online tendering by Cargoclix, he expects to use the logistics portal even more.
Wincanton has optimized network contracts via the online marketplace at Cargoclix
Wincanton is among the leading logistics and transportation service providers in Germany and Europe. In Germany alone Wincanton is active in 76 locations and offers a broad spectrum of tailor-made logistics services. Along with contract logistics, the company makes use of its own cargo network with 40 locations. For an even greater optimization of its network performance, as of fall 2005 Wincanton has contracted to run about 78,000 runs over a period of one year (daily runs amount to 299 lines), in Germany and other parts of Europe. By means of the transparent tendering and bidding process on the Cargoclix portal, to a certain extent, new carriers and freight forwarders were able to be integrated into the Wincanton network and existing cooperation regarding the extent to which business and performance could be optimized.
The complicated proposal included the transport of general goods as well as hazardous material (HAZMAT) and included 299 transport lines across Germany. The requirements for equipment and the performance factor of transporters were every bit as comprehensive and were spelled out by means of the online tendering on the portal. In all, the Wincanton freight proposal included 16 tendering sections on the Cargoclix platform and additional bidding sections for day runs and night runs. Frank Pilz, head of the Euro-national network organization of Wincanton Germany and project manager for the online tendering, described the objective as follows: "With the tendering of this extensive transport operation by means of the Cargoclix online marketplace for transport and logistics we wanted to offer more transparency to our transport partners as well as the possibility of more extensive cooperation." On the one hand, there was progress in the expansion of the Wincanton network and the integration of further reliable and efficient transporters into existing structures, and on the other hand the logistics output and the effective involvement of previous transport partners were optimized.
Positive Effects for Wincanton and transport partners
This primary concern was also the reason to decide for the online tendering system with Cargoclix. For Cargoclix already makes use of a network of over 9,500 registered users in all of Europe. Compared to conventional tendering systems, the online tendering on Cargoclix's logistics marketplace makes possible a high transparency with regard to proposed transport runs and the marketing capability of one's bid. "That is how existing transport partners also had the possibility of expanding their production volume with Wincanton by means of the online tendering system," said Pilz, explaining the advantages. Therefore new production possibilities were frequently offered to existing partners, which trimmed the distribution process so that both sides profited from the tendering system, according to his experience.
Potential for optimization was maximized in every respect
A positive side-effect of the tendering system with Cargoclix was ultimately in some areas also an adjustment of transport costs to altered market opportunities. For the direct comparison of offers for buyers and bidders on the tendering portal of Cargoclix offers at the same time a basis for precision of calculation. Indeed in principle at Wincanton, price is not the decisive criterion for the actual awarding of a job. "At Wincanton we have very high demands for quality and reliability of our transporters. As a rule therefore, the worker who can be trusted to do excellent level of performance, or with whom we have already had good experience, is the one who gets the job," commented Pilz about the selection process. Accordingly there have not been significant changes in the structure of transporters.
Simple, effictive and innovative
Pilz describes the support from Cargoclix with the preparation of the tender for the submitting of bids on the online platform as helpful and well structured. "Although we naturally first had to do our homework for such a complex proposal," commented the project manager. Compared to a conventional tendering he rates the operative handling in issuing the transport job by way of Cargoclix basically as simpler and less complicated.
In his opinion the online terndering procedure at Cargoclix is essentially very effective in penetrating the market and obtaining a realistic appreciation of the actual possibilities and conditions of carriers and freight forwarders. "From every point of view the tendering of logistics contracts on the Cargoclix online marketplace is an innovative and modern process in the issuing of contracts and it is a good thing to be active there on the portal " he asserted.
Brose Auto parts Ltd & Co. KG: Overseas cargo logistics – in every respect well advised by Cargoclix
Millions of automobile drivers in the whole world use the technology of Brose: when they position their car door or window or seat, or adjust the mirror and steering wheel. The automobile manufacturer has high logistics requirements: among his customers are more than 40 automobile makers and the leading manufacturers of car seats.
For more than a year the company has been using the freight auction portal at Cargoclix to tender many of its contracts for the optimization of transports to almost 40 locations in 19 countries. The results have been so good that already a complex overseas cargo contract has been tendered by Brose with Cargoclix. "Cargoclix simply offers quick and easy solutions and at a fair market price that we expect," comments Josef Schwarzmann, responsible for central purchasing, service and IT for Brose, concerning the tendering of logistics contracts, and his decision for Cargoclix.
The tendering of logistics contracts on the portal of Cargoclix was begun by Brose in September 2004, first with land transports in all of Europe. The innovative producer of mechanical components for doors and seats for automobiles uses Internet-based freight auctions as a modern purchasing tool, in order to create a more effective awarding of transport jobs which is more in conformity with market demands. On account of the good experiences in previous freight auctions, Brose decided in April 2005, to implement for the first time a complex tendering of an overseas shipment. The tendering included a transport volume of 11 ships dispatched from Germany to worldwide destinations (including North, South and Central America, Mexico, South Africa and Asia), and 9 ships in cross traffic between Thailand, Korea, Brazil, Japan, Spain and Great Britain. "The good experiences so far with Cargoclix in the area of European land traffic have motivated us to implement a very complex and, for us, very important tendering by means of this portal. And it has been confirmed that we were also well advised by Cargoclix even with overseas cargo transports," reports Josef Schwarzmann, who was the manager of the overseas freight auction at Brose.
Uncomplicated and flexible implementation of the tender
The basis for the extensive tendering was an auction price sheet developed by Brose, which precisely unlocked the individual routes and details of each of the transports. The only requirement was in harmonizing the specified needs of Brose and the data needed for the submitting of the bid on the auction portal at Cargoclix to the extent that both the bidding and the evaluation process for freight forwarder and shipper remained uncomplicated both before and after. "Cargoclix created the suitable auction tool from that and produced the complex price sheet on the platform with minor adaptations but good results," said Schwarzmann, describing the concrete cooperation, which he felt was uncomplicated and flexible. He sees the reason for the effective handling in the expert competence of the Cargoclix team and the direct communication between the ones doing the work. "Both sides knew what they were talking about. After a few telephone conversations, we had a proposal," recalls Schwarzmann. This made it possible for him to concentrate fully and totally on the core activity. He calculates a good 40 percent time savings for the purchaser resulting from the tendering of logistics contracts on purchasing portals such as Cargoclix
Market transparency, quality and price are deciding factors for success
An additional important criterion for cooperation with Cargoclix, he said, along with good expert advice, was the price, which quite clearly contrasted from other purchasing tools. "The combination of logistical know-how and comparatively low fees makes the cooperation with Cargoclix especially attractive, particularly for the tendering of high volumes which are customary with Brose, " said Schwarzmann.
For a business with high demands for quality, such as Brose, it was also essential to invite only freight forwarders to the auction who could also handle the extensive transportation tasks reliably. For this the tool known as "Private Markets" offered by Cargoclix was used, a tool which allows tenders within a closed user group. The enormous advantage of issuing transport jobs by way of the freight auction, as Schwarzmann sees it, is in the clearly enhanced market transparency, which results for purchaser and bidder by direct comparison of bids. The winner of the overseas freight auction was then ultimately the bidder who led in terms of both price and performance.
Reduction of logistics costs
All in all, a remarkable reduction of the originally budgeted transport costs resulted from the contract auction with Cargoclix. The person responsible for purchasing logistics at Brose is certain that the timely form of tendering of logistics contracts by means of freight auctions is being used more and more by large companies, and is even making significant inroads among smaller firms. "Here Cargoclix, as a trade-name, already has wide acceptance, and is making the right move into the market by its reasonable offers, in order to have many interesting contractors and qualitatively good freight forwarders in its user pool. And in my opinion this will be the deciding factor for the long-term success of the auction portal in the area of logistics."