PINC Acquires RailcarRx

pinc-railcarrx-rail-maintenance

Investment Marks Second Acquisition for PINC in Less Than 30 Days of Complementary Supply Chain Management Software Capabilities

Union City, CA – October 8, 2020PINC®, the leader in digital yard™ solutions, today announced that it has acquired RailcarRx®, a provider of a comprehensive suite of rail industry software solutions and services. RailcarRx software provides maintenance, repair, fleet and asset management insights that help railroads, railcar owners, repair shops and shippers operate more efficiently, monitor equipment health and improve safety.  RailcarRx will continue to operate and support its customers with the existing staff and supplier relationships, so that customers will receive the same high level of service and support they have come to expect from RailcarRx.

This transaction marks the second add-on acquisition for PINC in less than thirty days – PINC acquired a transportation management software (TMS) carveout from Wabtec Corporation on September 15, 2020. Known by its trade names, ShipperConnect and ShipXpress, the Shipper TMS software provides cloud-based shipment management applications to industrial shippers that move goods over multi-modal transportation, including rail. RailcarRx is a natural extension of these capabilities that will enable shippers to monitor rail fleet health, track fleet in various repair and maintenance stages and significantly improve rail logistics operations.

Multi-modal TMS and analytics solutions such as those offered by RailcarRx and Shipper TMS is part of a broader growth strategy for PINC, a Gartner “Best of Breed” digital yard management software solution leader. Accel-KKR completed a significant growth equity investment in PINC in June 2020. These add-on acquisitions support PINC’s goal of expanding its digital yard and transportation management solutions to help clients further optimize their complex supply chains.

A true end-to-end supply chain execution (SCE) platform will play a vital role in reducing the number of point solutions and manual, non-value added processes for supply chain leaders facing ever-growing transportation complexities and cost pressures. PINC’S expanding capabilities serve as a foundation for an SCE platform focused on comprehensive transportation management software solutions for shippers. The platform will prioritize offerings that serve the origin and termination points in the supply chain with a specific focus on rail, truck, and terminal yard management. Combining powerful execution functionalities such as electronic documentation, analytics, billing, rating and carrier management with real-time visibility, the platform is well-positioned to solve multiple transportation challenges in the supply chain industry. Customers will be able to turn to PINC to see, automate, and execute more components of their supply chain.

About RailcarRx: 

RailcarRx provides software solutions, IT project support and expert consulting resources to clients ranging from freight and passenger railroads, to maintenance shops, railroad equipment finance organizations and railcar owners. For more details, visit railcarrx.com.

About PINC:

PINC provides scalable software, hardware, and services that enable companies to identify, locate, and orchestrate inventory throughout the supply chain predictably and cost-effectively. The company’s cloud-based real-time tracking platform, powered by an Internet of Things (IoT) sensor network that includes passive RFID, GPS, computer vision, cellular, and other sensors, provides actionable insights and connected expert guidance that allow organizations to optimize their supply chain execution. To learn more, visit PINC at www.pinc.com.

Media Contact:

For PINC:

Rafael Granato
Vice President of Marketing
PINC
+1 (510) 474-7509
rgranato@pinc.com

For RailcarRx:

Josh Lippy
Director of Sales
RailcarRx
+1 (972) 559-3465 x 103
Jlippy@railcarrx.com

7 Ways to Reduce Carrier Detention Fees and How Digital Yard Management Can Help

Yard management detention charges

If you’ve been paying higher and higher driver detention fees lately, you’re not alone. According to a new report from C.H. Robinson and Iowa State University, favored shippers are receiving better pricing and service. Those that don’t fall into the “shipper of choice” category are bearing the brunt of the driver detention and related fees.

In Do Favored Shippers Really Receive Better Pricing and Service? the report’s authors set out to better understand the voice of U.S. truckload carriers and quantitatively measure the effects of “favored shipper” characteristics on transportation costs. Through this process, they found that the top three characteristics impacting these costs include:

  1. Dwell time/asset utilization. Carriers most frequently commented on shipper and consignee dwell time and the influence shippers have on the carrier’s ability to utilize their drivers and assets (trucks and trailers), the report notes. Comments included concerns about shipper location (e.g., congestion and distance from the highway), drop trailer opportunities, appointment setting, and load/unload times.
  2. Contract terms and liability. All carriers mentioned liability concerns related to either the freight or the drivers who are on shipper/consignee property, according to the report. Payment terms, actual payment time, and detention (driver and trailer) were also commonly discussed.
  3. Driver experience. Several carriers mentioned concerns related to the driver’s experience at the shipper and consignee. These ranged from the check-in process—which can be facilitated by a digital  (YMS)—and parking, to driver lounges and restrooms. “In general, smaller carriers were more likely to discuss driver issues than larger carriers.”

Using shipment data and econometric modeling, Iowa State University’s researchers quantitatively measured the effects of these characteristics on transportation costs. With a 2-hour dwell time at origin increasing the freight rate for every load shipped by an average of $9.83 (along with any detention charges), that cost multiplied across many loads can add up quickly.

7 Steps to Take Now

To keep carrier dwell time to a minimum and reduce the related charges, C.H. Robinson and Iowa State University tell shippers to start using these strategies:

  • Leverage live load flexibility. Freight may be ready early for pickup. If a dock door is open and the shipper can proactively communicate this to their live load provider, they can obtain a truck before a scheduled appointment. “Live loading provides the flexibility to deal with fluctuations in demand,” the report’s authors state. “It enables coordination between manufacturing, shipping, and the carrier to accommodate freight when manufacturing is ahead of schedule, or when shipping falls behind.” Using your YMS, you can designate a dock door (or a percent of time for multiple doors) for live load activity or combined drop trailer/live load freight. This strategy enables the shipper or consignee to dramatically reduce the amount of time the driver is on their property.
  • Pre-stage freight on shipping dock. Proactively prepare for carrier arrivals so they can get in and out faster. This is another process that your digital YMS can handle for you.
  • Offer appointments for loading and unloading. Put an appointment or notification scheduling process in place to maximize the use of dock doors and people and to increase efficiency. “Stay as close to designated times as possible,” the report’s authors advise. “Also monitor the receivers’ facility characteristics and what the carrier encounters on the delivery end.”
  • Palletize freight. Palletized freight can be loaded and unloaded faster than loose boxes and pieces.
  • Maintain adequate staff for loading and unloading. “A cascading effect quickly occurs on dwell time when dock staff is insufficient to handle scheduled appointments,” the report notes. “Shippers should ensure that adequate staff is on hand at all times.”
  • For large facilities, provide a good map or directions to the appropriate dock door. To reduce frustration and enable faster loading/unloading times, provide carriers with a map and directions to the appropriate dock door or their shipment.
  • Use drop trailers. Shippers can load drop trailers according to their timing and schedules. “The carrier arrives, hooks up the trailer, and goes, with a minimum of wait time,” the report states, “This is easily the best solution in high-volume facilities.”

What does ‘on-time, in-full’ (OTIF) mean in the consumer sector?

McKinsey & Co., and Trading Partner Alliance outline some of the key considerations that should go into developing and using the on-time and in-full delivery metric.

Dock Doors - Yard Management Software OTIF

Supply chain complexity is increasing as customers demand a wider selection of products, a broader choice of channels, and more promotional offers. With expectations of higher on-shelf availability and lower inventory costs, the pressure on delivery performance has intensified—as has the need for manufacturers, retailers, and carriers to work together to create efficient, reliable, and responsive supply chains.

The global pandemic has accelerated this trend, and along the way unveiled some major gaps in the world’s supply chains. To fill these gaps, a growing number of companies operating in the consumer sector have adopted the “on-time in-full” (OTIF) delivery metric.

What is OTIF?

According to McKinsey & Co., OTIF measures the extent to which shipments are delivered to their destination according to both the quantity and schedule specified on the order. “In theory, OTIF should be the ideal mechanism to align the objectives of retailers and manufacturers,” the global consultancy points out.

The problem is that there is no standard definition for OTIF. Because of this, supply-chain participants may interpret the metric differently. For example:

  • Does “on-time” mean on the date requested by the retailer, or the date promised by the manufacturer?
  • Does it mean within the specific delivery slot allocated to the shipment, or any time inside a broader, agreed-upon time window?
  • Should “in-full” be measured at the level of complete orders, line-items, or individual cases?

“These differences matter,” McKinsey says in its report, noting that effective supply-chain collaboration depends upon a precise, common understanding of delivery-performance expectations. “Today’s diversity of approaches means partners waste time arguing over the figures, rather than addressing the root causes of delivery issues.”

Survey Says…

To get industry perspectives on OTIF, the Trading Partner Alliance (TPA) and McKinsey surveyed major retailers and manufacturers of North American consumer packaged goods (CPG). Ninety-two percent of those companies agreed that an industry standard for OTIF would create value.

“They noted that a standard definition would significantly reduce discrepancies and confusion and promote collaboration among trading partners,” McKinsey states. “Collaboration would help partners resolve supply problems more efficiently and effectively—creating value for all supply-chain participants as well as for consumers.”

A common definition for OTIF would also:

  • Create a common view. A common view of supply-chain performance would support consumer-goods supply chains by aligning service expectations; enabling joint performance management; and supporting performance benchmarking.
  • Streamline data complexity. “Retailers and manufacturers end up devoting significant time to explaining and reconciling differences in reported data,” McKinsey points out. “Carriers are often caught in the middle, as both retailers and manufacturers push them for improved performance based on inconsistent data and requirements.”
  • Reduce supply chain complexity. Because each retailer has a different definition of OTIF, manufacturers must meet a variety of different delivery standards and keep up with each retailer’s changes to its individual definition. “Even the major retailers use different definitions, and their definitions keep evolving,” McKinsey notes.

So what’s the solution? A viable working definition of OTIF, which McKinsey says would look like this:  “Case quantity that is delivered to the destination by the requested delivery date, calculated as a percentage of the ordered quantity.”

The other parameters would include:

  • Any overdelivered quantity or inaccurate product shall be disregarded.
  • Arrival at the destination facility (rather than when checked in or unloaded, which may be subject to delays outside the manufacturer’s control).
  • The requested delivery window should be the delivery date requested at the time of order placement, adjusted for any retailer-caused appointment delay, measured to the end of the working day and with a one-day early allowance.

$15-$20 Billion in Lost Sales

As the industry works toward a common definition for OTIF, the complexities of running the world’s supply chains will increase exponentially. “Consumers expect products to be on the shelf,” McKinsey points out, noting that the U.S. food retail industry loses an estimated

$15-$20 billion in sales (2%-3% of its total sales) every year due to out-of-stock or unsaleable merchandise.

“The main operational challenge for the consumer sector is to achieve high levels of on-shelf availability,” it adds, “while keeping supply chain costs down and inventories under control.”

PINC named Top Supply Chain Projects for 2020 by Supply & Demand Chain Executive

TOP 100 SDCE Yard Management Solution

Union City, CA – July 29th, 2020 –  Supply & Demand Chain Executive, the executive’s user manual for successful supply and demand chain transformation, has selected PINC, the leader in digital yard™ solutions, as a recipient of an SDCE 100 Award for 2020.

The SDCE 100 spotlights successful and innovative projects that deliver bottom-line value to small, medium and large enterprises across the range of supply chain functions. These projects can serve as a map for supply chain executives looking for new opportunities to drive improvement in their own operations. These initiatives also show how supply chain solution and service providers help their customers and clients achieve supply chain excellence and prepare their supply chains for success.

Since its founding in 2004, PINC has been a pioneer in providing real-time visibility and workflow orchestration to yard operations across distribution centers and manufacturing plants worldwide. PINC’s platform is currently utilized by an array of Fortune 1000 enterprises and gives companies a cost-effective way to move inventory faster and optimize their supply chain.

“Innovation is essential in driving the supply chain industry forward, and thanks to these valuable partnerships, companies of all sizes are able to achieve success in projects that matter,” says Marina Mayer, editor for Supply & Demand Chain Executive. “From business intelligence systems and supply and demand planning to inventory reduction and procurement solutions, the SDCE 100 offers proof-of-concept that with the right planning and execution, anything is possible.”

“We are very grateful for this award during one of the most challenging years of this century,” said Rafael Granato, Vice President of Marketing at PINC. “Given the uncertainties and increased customer expectations placed upon trailer yards, we are playing a more vital role at the termination points of transportation networks, by expediting shipments and reducing transportation costs.”

About PINC:

PINC provides scalable software, hardware, and services that enable companies to identify, locate, and orchestrate inventory throughout the supply chain predictably and cost-effectively. The company’s cloud-based real-time tracking platform, powered by an Internet of Things (IoT) sensor network that includes passive RFID, GPS, computer vision, cellular, and other sensors, provides actionable insights and connected expert guidance that allow organizations to optimize their supply chain execution. Visit PINC at www.pinc.com. 

About Supply & Demand Chain Executive:

Supply & Demand Chain Executive is the executive’s user manual for successful supply and demand chain transformation, utilizing hard-hitting analysis, viewpoints and unbiased case studies to steer executives and supply management professionals through the complicated, yet critical, world of supply and demand chain enablement to gain competitive advantage. Visit us at www.SDCExec.com.

KEARNEY & CSCMP: 6 Technologies Driving Logistics and Supply Chain Forward in 2020

New insights from Kearney and CSCMP show how technology is helping the logistics industry work smarter, better, and faster in today’s challenging business environment.

Kearney-CSCMP-Technologies-2020

In 2019, organizations around the world were dealing with trade wars, electronics component shortages, labor crunches, and geopolitical issues like Brexit. By early-2020, the entire world’s attention shifted over to fighting a global pandemic and coping with the steep toll it took on human life, livelihoods, businesses, and industries.

In response, the logistics industry has spent the past few months dealing with crises. Now, it’s carving out a path forward in a VUCA (volatility, uncertainty, complexity, and ambiguity) world, where new challenges continue to surface daily.

Some signs are optimistic, according to Kearney and CSCMP’s 31st Annual Council of Supply Chain Management Professionals (CSCMP) State of Logistics Report. For example, e-commerce continues to boom, amplified by the online shopping of those sheltering at home. Some carriers maintained profits despite declining volumes in 2019, suggesting a commitment to pricing discipline that may help them survive the bigger drops of 2020.

“An economic slowdown damaged most sectors of the economy, including logistics,” Kearney points out in its report, which covers the macroeconomic factors affecting logistics, insights from industry leaders, discussion of important trends, detailed analysis of each major logistics sector, and a strategic assessment of the industry.

6 Ways Tech is Making a Difference

In its report, Kearney discusses how the implications of the COVID-19 crisis have reemphasized the value of technology in logistics. Here are six advanced technologies that it says will continue to positively impact the industry for the near term:

1) Artificial intelligence and machine learning: Artificial intelligence (AI) and machine learning (ML) are broad categories, which companies across all stages of logistics are already using to make smarter and quicker decisions. AI and ML directly address the data challenge, helping companies turn existing data into better insights and competitive advantage. “Their importance to the industry is why 20 percent of the AI-100 are in logistics,” Kearney points out, noting that companies can use AI and ML to:

  • Anticipate market changes to make better planning decisions
  • Predict high-demand products, so that warehouses can move them to easy-to-access locations
  • Optimize delivery routes based on real-time traffic and weather conditions
  • Recognize damaged goods before they get delivered
  • Automate simple, repetitive back-office tasks to reduce paperwork, improve productivity, and reduce errors

Calling AI and ML “dominant disruptive forces in logistics,” Kearney says the value they bring is clear. “Barriers to entry are lowering, computing power continues to grow, and ever more data is ever more widely available.

2) Robotics and automation: Kearney breaks robotics and automation technologies down into two categories: moving goods and handling goods.

  • Autonomous trucks are likely to develop in stages: first platooning, then driverless platooning, then full-blown autonomous vehicles operating at scale without drivers all the way from loading to delivery. Similar, but lower-impact, effects can be expected in rail, air, and warehouse drones.
  • In warehouses, robotic shelves can move goods to picking stations, picking systems can use robotic arms with sensors to effectively grasp many shapes of objects, and autonomous palletizers can robotically build pallets from units and cases.

Noting that autonomous vehicles still need to make significant headway on safety and regulatory issues, Kearney says stakeholders need to come together to build the vision of a driverless world, which is likely still years away. “Platooning will come first, in three to five years, and fully autonomous vehicles will become a reality in about 10 years,” it concludes. “However, the handling technologies focused on picking, sorting, and palletizing are already in full swing.”

3) Augmented reality and virtual reality: Augmented reality (AR) and virtual reality (VR) can make processes more efficient, thus improving productivity, especially in warehousing and delivery. The earliest examples have focused on aiding warehouse product picking by displaying instructions on smart glasses for items in the field of vision. Glasses can also provide instructions for employees performing maintenance tasks.

“Eventually they could even help employees find the right pallets when loading or unloading a truck,” Kearney adds. “The approach can reduce lead times, error rates, and job training requirements.” Similar approaches on vehicle windshields could aid delivery people, perhaps even by showing a picture of the package’s intended recipient.

“In the near term, AR and VR will likely remain limited to existing use cases in warehouse product picking and training,” Kearney predicts, “although it will likely expand from early adopters to other competitors in those areas.”

4) 5G and the Industrial Internet of Things: Companies can use the new 5G wireless standards in three key ways:

  • End-to-end visibility. 5G will enable companies to deploy many more devices, creating an Industrial Internet of Things (IIoT) that can provide real-time data for container-, truck-, and SKU-level tracking.
  • Enhanced routes and schedules. Better tracking will help organizations avoid delays, eliminate unnecessary trips, and optimize routes and schedules in real time.
  • Improved maintenance. The 5G network will support VR and AI technologies to improve on- and off-road maintenance.

“5G networks will soon be ubiquitous,” Kearney predicts. “However, beyond the 5G-powered infrastructure on which copious devices can communicate, achieving full IIoT benefits also requires easily available low-cost devices and the emergence of standards for their communication across the network.”

5) Renewable energy: Logistics companies can benefit from renewables through savings in fuel and power, reducing emissions to meet consumer preferences, and potentially increasing delivery windows through quieter electric fleets. Kearney sees three clear innovation areas within the logistics space:

  • Electric trucks rely on battery innovations that reduce costs and charging times (for example, swappable batteries).
  • Electrified last-mile vehicles may include handcarts, tricycles, or medium-sized vans.

Green warehouses reduce carbon footprints through rooftop solar panels, smart motion sensors to reduce illumination requirements, and forklift charging in off-peak hours.

6) Blockchain: Kearney says that while blockchain’s decentralized nature and transparency can improve tracking and reduce inefficiencies in logistics, advocates often overlook the foundation of digitization needed to extract the full potential of the technology. “There are also technical issues,” it points out. For example, a smart contract won’t self-execute without connectivity at the point of delivery to log the fact that the goods were delivered.

Before blockchain can become ubiquitous in the supply chain, Kearney says there are also trust issues to work through. “Making all data in a network transparent to all users can undermine trade secrets. These and other issues surrounding blockchain in logistics are certainly solvable,” it explains. “But it may take years for the solutions—and the changes in a wider ecosystem that they require—to be ready to live up to the hype.”

Stepping up to the Plate

The COVID-19 crisis serves as a reminder of the world’s reliance on logistics to deliver regardless of circumstances. It also accentuates some of the industry’s challenges, especially in meeting increased e-commerce demand from customers. “It highlights the need for modernization and technological advances,” Kearney states.

Do you agree? Please let us know.

KEARNEY & CSCMP: How the Logistics Industry is Navigating the COVID Crisis

New report from Kearney and CSCMP paints a picture of a resilient industry that’s increasingly turning to technology and automation to help navigate the COVID crisis and subsequent economic downturn.

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Coming off a very strong year in 2019, the logistics industry is proving itself to be both adaptive and resilient in the face of major adversity in 2020. Impacted by the convergence of a global pandemic and economic downturn, the industry is in the process of shaking off these negative impacts and learning how to operate in the “new normal” business environment.

These and other insights were recently unveiled in the 31st Annual Council of Supply Chain Management Professionals (CSCMP) State of Logistics Report. Developed by Kearney, CSCMP, and a team of industry leaders, the annual report covers the macroeconomic factors affecting logistics, insights from industry leaders, discussion of important trends, detailed analysis of each major logistics sector, and a strategic assessment of the industry.

“Globally, countries are grappling with halting recoveries of supply, ongoing demand destruction, and secondary waves of infection—and the U.S. is no exception,” Kearney points out. “This painful and chaotic period is causing logisticians and all who depend on them, to adapt and evolve. As they fight to survive, to operate, and then to win anew, both shippers and carriers will depend on more quickly adapting logistics capabilities.”

Recovery Ahead

In 2019, U.S. business logistics costs (USBLC) rose 0.6 percent to $1.63 trillion, or 7.6 percent of 2019’s $21.43 trillion GDP. “Yet in mid-2020, that all seems like history,” Kearney points out. “The pandemic, and global measures taken to reduce its further spread, have decimated supply chains, scrambled logistics capabilities, and destroyed huge swaths of demand. The size, shape, and timing of a recovery remain in question.”

According to Kearney, the pandemic has also highlighted the value of the logistics industry. “Whether it’s delivering critical medical supplies or allegedly hoarded toilet paper, logistics is essential to national security and wellbeing,” it says. “Many of its employees were rightly labeled as essential workers.”

Some signs are optimistic. E-commerce continues to boom, amplified by the online shopping of those sheltering at home, Kearney reports. And, some carriers maintained profits despite declining volumes in 2019, suggesting a commitment to pricing discipline that may help them survive the bigger drops of 2020.

Going forward, it says supply chains will need to become more resilient, better able to adjust to, and recover from future difficulties. “The shift away from single-source, cost-focused supply functions may pose new challenges to logistics,” Kearney cautions, “which itself is having its resilience tested in this crisis.”

Warehousing is a Bright Spot

According to Kearney, the warehousing market continues its growth. In 2019, rents kept rising and vacancy rates stayed near historic lows. E-commerce continued to drive growth, especially in smaller, high-amenity urban warehouses. “The fourth quarter of 2019 represented the highest square footage completed in a single quarter on record,” it says, “and the vacancy rate barely budged.”

In 2020, the disruption of consumer supply chains caused by the coronavirus pandemic is expected to drive a new surge in warehousing demand, especially for temperature-controlled warehouse space, as more consumers order food online. “Pandemic e-commerce is leading to an expected increase in adoption of warehouse automation solutions to keep costs and operational complexity in check even further,” it says.

For example, sales of autonomous mobile robots (AMRs) are estimated to double to $27 billion by 2025. Overall, it is estimated that a 5 percent bump in safety-stock inventory will require about 750 million square feet of industrial space as companies soften their lean-inventory strategies.

“The rise in stock levels should spur industrial activity,” Kearney predicts, “given the expectation that the warehouse construction pipeline will remain full and warehouse availability will remain tight.”

Agility Trumps Forecasting

In a recent article by Supply Chain Dive entitled Unilever CSCO: Agility beats forecasting when the supply chain is stressed, Chief Supply Chain Officer Marc Engel emphasizes the need for an accelerated digital transformation during these challenging times. He comments why

“Agility does trump forecast[ing],” the CSCO said. “At the end of the day, every dollar we spent on agility has probably got a 10x return on every dollar spent on forecasting or scenario planning.”

Unilever is working toward automating processes and leveraging the data collected to become more agile and accelerate its supply chain.

Technology Drives Logistics

The implications of the COVID-19 crisis have reemphasized the value of technology in logistics. Even providers previously hesitant to invest in digital yard management solutions, shipment location tracking, or electronic signatures, claiming such digital technologies were unnecessary, are now embracing them as table stakes.

With rising labor costs, and despite the COVID-19-induced recession, shippers and 3PLs are looking to automation to make logistics more efficient. While a serious uptake of autonomous trucking is still five to 15 years away, legions of mobile robots are already working alongside humans in warehouses and automated systems for yard and transportation orchestration are enabling those organizations to gain agility.

“In general,” Kearney says, “winners will emerge from this crisis with more digitally savvy logistics operations, especially in the areas of creating transparency and interfaces while reducing needs for physical labor across modes and nodes.”