This past week, my mother, Ethel Goodwill, passed away after a three month battle with an aggressive and rare form of cancer. She was 90 years old. My dad was killed in a car accident when I was 9 years old. My mother took on the responsibilities of mother and father from that point on and did a remarkable job. Ethel Goodwill was a warm and gentle soul with a quick wit and great sense of humour. She was a very upbeat, courageous, positive and independent person. She was a role model for me and my wife Gail, hard working and honest, a person with great common sense. Ethel will be sadly missed by her friends and family for her courage, positive attitude and for the love she gave to those around her.

My weekly blog on Transportation will return next week.

Twice within the past month, once from a client and once from a student in York University’s Master’s Certificate in Supply Chain and Logistics program, I was asked the same question. What can you recommend in terms of “quick wins” in the area of transportation cost savings? Quick wins can be defined as cost savings that can be achieved within a very short period of time and at minimal expense. This is an excellent question. I have captured some thoughts on this topic in this blog.

As I have reflected on this question over the past few weeks, it caused me to identify some of the lessons I have learned working with shippers over the past six years.

Lesson #1: There are Quick Wins in Every Company that Ships Goods

There are opportunities to achieve “quick wins” in freight cost savings in almost every organization, irrespective of how well it is managed. Individually and collectively we all possess a subset of the total knowledge on freight transportation. Along the way, we have all missed certain things as we have come up the learning curve.

Lesson #2: Sometimes You Need an Outsider to find the “Quick Wins”

Over time we acquire certain beliefs, experiences and paradigms. These life experiences may cloud our judgement or prevent us from seeing some cost savings opportunities that exist in our own organizations.

Sometimes you need to spend money to save money. A new set of eyes and ears may uncover opportunities that have gone unnoticed for years. There are often certain companies or individuals that possess a specific expertise that may not be available in your organization. For those enlightened companies that are willing to make the investment, the payoff can be considerable.

Lesson #3: A “Quick Win” in one company may be a Medium Term or Long Range Win in Another

Every organization that ships goods is different. Some organizations make decisions quickly and effectively while others do not. Some have developed a culture of change while others do not. The ability to identify “quick win” opportunities and act on them in a timely manner varies from company to company.

Certainly shippers can save significant amounts of money in freight costs if they conduct a freight transportation RFP, change organization structures to improve collaboration between various departments, acquire a TMS system or conduct a network optimization study. Unfortunately, these items may not meet the definition of “quick wins” in most companies. Each of these activities can take 45 or more days to complete and requires some expenditure of money and/or resources.

Here is a list of opportunities that can be classified as “quick wins” in many but not all organizations.

1. Hold freight and ship on Carrier Service Days

Most LTL carriers run on certain schedules. Shipments departing on Monday may arrive at destination on Wednesday or Thursday. Tuesday shipments may arrive on Thursday or Friday. But freight leaving on Wednesdays, Thursdays and Fridays may not be delivered until Monday. An easy way to save money is to convert from moving daily LTL freight to holding the freight and moving it so that it all arrives on scheduled delivery dates. Learning your carriers’ pick up and arrival schedules is an easy way to save money on freight.

2. Consolidate freight and move larger size shipments

Moving larger shipment sizes will reduce freight costs. There are several ways of doing this. Similar to item 1 above, a shipper can plan to ship to certain locations, only on designated days of the week. Another option is to build multi stop truckload shipments whenever possible, if there are blocks of traffic going to specific areas. If you are a Quebec-based LTL shipper bringing in LTL freight from multiple locations in Ontario, consolidate your shipments in Toronto and then load them as a single shipment from Toronto to the designated area in Quebec.

3. Perform Freight Rate Benchmarking

Every shipper wants to know how their rates compare to market rates. Benchmarking allows you to pinpoint those lanes where specific rates are out of line with market levels and then take corrective action (e.g. find carriers with more competitive rates on those lanes).

There are several ways of doing this. The easiest way is to contact a number of carriers and ask them to quote on your business. Truckloadrate.com (http://www.truckloadrate.com/) is another option. For the modest amount of $30 per month, truckload shippers can enter origin and destination points and determine market rates and the range (e.g. minimum and maximum) of rates available. Another more costly option is to conduct a formal benchmarking study. With benchmarking studies, always keep in mind that the market can change quickly. The only way to know precisely what rates your company can obtain in the market on any given day is to conduct a comprehensive RFP.

4. Optimize Loading

No matter which mode of transport one uses, a shipper is paying for the space occupied, the weight and the density of the products shipped. Therefore, it is critical to maximize the space occupied. To excel in this area requires knowledge of several things. It is essential to have a familiarity with all modal options - - multi axle trailers, B-Trains, LCV’s, container capacities, legal weight restrictions by state/province and equipment availabilities.

It also demands an insight into trailer/container loading opportunities. There are logistics trailers within which various sizes of pallets can be loaded. There are false floors that can be used to permit the double stacking of pallets while preventing them from being crushed. A quick win can be achieved by selecting the right type of equipment that permits the optimum type of loading for your company’s freight.

5. Manage Routing Guide Compliance

Every shipper should have some sort of routing guide. The guide should list all of the lanes, the rates charged on each lane and the names of the carriers serving the lanes in rate/service order. But freight management cannot be done on “auto pilot.” This takes time and effort; but it is time very well spent.

Compliance tracking, even if done on an Excel spreadsheet, can highlight a lack of internal discipline (by Traffic Management personnel) and/or a lack of carrier compliance (e.g. load refusals causing your dispatchers to use low ranked or unranked carriers in the routing guide). Preparing and reviewing a weekly tracking report can identify internal or external problems that are resulting in excessive expenditures on freight.

6. Implement Modal Conversions

Many shippers adopt paradigms of thinking based on historical experiences. Some of these paradigms may no longer be valid. On some lanes, intermodal service may be very competitive with truck service. Even if it is a day longer, it may be satisfactory for a particular company’s clients. Periodic market assessments, modal conversions coupled with service level agreements (SLA’s) on some lanes, may produce cost savings.

Where has your organization achieved “quick wins” in freight costs? Please post your experiences on this blog.

For the second consecutive year, MotorTruck Fleet Executive magazine and Dan Goodwill & Associates will be co-hosting a conference on how to maximize the profitability of a trucking company. This event is targeted at owners and leaders of truck fleets and will address the key issues facing them in 2010. The Workshop will be held on May 26 at the Airport Marriott Hotel in Toronto.

The Workshop will begin with an overview of the current economic situation, presented by Carlos Gomes, Senior Economist at Scotiabank. In his remarks, Carlos will highlight the impact of these developments on Canadian trucking companies. I will follow Carlos and address the issue of how to revitalize a trucking company’s sales program. Many trucking firms experienced double digit sales declines in 2009. This segment of the conference will focus on how to rebuild revenues and improve yields.

Ken Manning, President of Transportation Costing Group will then address an issue of critical importance to every trucking company executive, namely making sure that an accurate costing model is in place so as to ensure every piece of business is delivering the maximum contribution. Ken will be followed by Marc Cascagnette, Vice President of Cushman and Wakefield. Marc will provide an overview of the current real estate market for transportation and distribution facilities and will highlight some strategies to derive the maximum benefit from these important assets.

Jack Ampuja, President of Supply Chain Optimizers will provide an insight into an issue that is becoming increasingly important in freight transportation, packaging optimization. Wal-Mart and other world class shippers are actively searching for ways to improve cube utilization as a means of driving down freight costs. Jack will share his experience in this area.

This year the conference will feature two interactive panel discussions led by Lou Smyrlis, Editorial Director of MotorTruck Fleet Executive. The first panel will include three leading shippers, Mark Gallant of Home Depot, Mike Owens of Nestle and Ginnie Venslovaitas, formerly of Unilever. Lou will engage the three panellists in a discussion of the strategies they are employing to manage freight programs in 2010.

This panel will be followed by a discussion with the leaders of three well-known Canadian trucking companies, Dan Einwechter of Challenger Motor Freight, Peter Di Tecco of Armbro Transport and Doug Munro of Maritime-Ontario Freight Lines. Lou will engage them in a dialogue on how they are managing their trucking companies through this so-called economic recovery.

These panel discussions will be followed by a presentation from Kevin Snobel, General Manager of Caravan Logistics on effective workforce strategies to lead and motivate employees. Elian Terner, Director, Investment Banking at Scotia Capital, who specializes in mergers and acquisitions in the trucking industry, will then address the issue of how to rebuild value in trucking businesses after the setbacks of 2009. He will be followed by Jim Papineau, Director of Supply Chain Systems & Automation of Dan Goodwill & Associates. Jim will provide an overview of the results of an extensive study he just completed on computer systems to manage trucking businesses. For those companies seeking to upgrade or replace their current system to improve productivity, Jim will provide some insights.

In keeping with the format of last year’s Workshop, the conference will wrap up with four discussion groups. These groups will be led by four of the speakers. In each session the conference attendees can “speak with an expert” concerning those topics of most interest to their particular trucking company. The four topics will be business development, costing models, real estate and computer systems. Only two discussion groups will be held at a time so everyone has an opportunity to engage in a dialogue on the two topics of most interest to them. Those companies that register two or more people will be able to have a team member attend all four of the small group discussions.

Note that April 26 is the last date to register and receive the “early bird” special rate, a savings of $100 or 25% of the regular rate. Those companies seeking to re-energize their trucking companies, to learn some new strategies and to network with other industry executives can look forward to a stimulating and productive day. For more information on the conference or to register, click on: www.dantranscon.com.

The Canadian population is about one tenth the size of the U.S. population or roughly the size of California. Its economy, ranked tenth largest in the world is about ten percent of the size of the U.S. economy. The two countries have been each other’s largest trading partners for many years. The 2008-2009 recession had a dramatic impact on U.S. – Canada trade as cross-border activity dropped by 30%.

The two economies did not experience the same impact from the recession. “Canada experienced a short, sharp recession,” Mark Carney, governor of the Bank of Canada, told the Winnipeg Chamber of Commerce in February. “Domestic demand, fixed capital investment and employment in Canada all held up substantially better than in the U.S.”

A number of factors are reshaping trade and freight flows between the two countries. Canada did not experience the U.S. housing bubble and banking crisis. The Conference Board of Canada’s Consumer Confidence Index hit 96.6 in January, well beyond the 55.9 confidence rating in a similar U.S. measure and the highest the board has measured in 23 months. The Canadian dollar has appreciated against the U.S. dollar over the past twelve months from $0.80 to par.

The Canadian dollar is likely to continue its ascent. This week the Bank of Canada signalled that it will increase interest rates (ahead of the United States).

A faster Canadian recovery bolstered by the fast rising dollar and more confident consumers are causing Canadians to speed up their purchases of U.S. goods. February’s trade data provided evidence that manufacturers, who export half of what they produce, are using the currency’s effect on import prices to buy new equipment that will help them become more efficient. Imports rose to $32.6 billion as volumes increased, mostly for machinery and equipment.

Last year, Canadian companies bought more assets abroad than they sold for the first time since 2004. In a report prepared by the New York law firm of Paul, Weiss, Rifkind, Wharton & Garrison, they showed that the value of Canadian cross-border deals jumped by 94 percent last year to $U.S. 37.1 billion, the largest proportional gain of any of the 10 countries the firm looked at, including the U.S., Britain and China.

Anecdotal evidence is also suggesting that Canadians are taking advantage of the currency increase to purchase winter homes in U.S. Sunbelt locations. One client this week indicated that his company is shifting some production from their Canadian operations to their U.S. plants to better serve their U.S. clients and take advantage of the lower cost base, specifically the lower freight costs that are a by-product of manufacturing goods closer to their U.S.-based consumers.

These impacts are being seen by truckers in the cross-border freight flows. Ernie Valdez, director of international solutions at Tennessee based Averitt Express, a member of the Reliance Network that links to Canadian carriers Epic Express and Canadian Freightways, reported that he saw a “decline in less-than-truckload business domestically, but we actually saw an increase on the export side. . . Toward the end of the year we saw a 13 to 14 percent increase in shipment count.”

To capitalize on the business upturn, UPS Freight is extending its reach across the U.S.-Canadian border by shortening transit times between major Canadian cities and U.S. markets. The company opened a $30 million, 145,000 square foot distribution centre in Calgary, Alberta that is close to the FedEx operation at the Calgary International Airport. Much of that cross-border business is moving north, said Joe Picone, vice president of eastern U.S. and Canadian operations at the Virginia based arm of UPS.

Historically, this type of swing in the value of the currency would spell doom for Canada’s highly export driven economy. This time things are different. February marked the fifth straight monthly surplus, which eclipsed analysts’ expectations by widening to $1.4 billion from $754 million in January. Canada’s exporters are pushing deeper into diverse markets as global trade rebounds. The increase in exports outpaced import gains three-to-one, even as the currency moved toward par with the U.S. dollar.

Exports to the U.S. rose 2 percent to $4.4 billion on demand for autos. But companies are reducing their dependence on the damaged U.S. market. Exports to countries other than the U.S. rose by 5.2 percent as sales to Germany, Mexico, the U.K., Turkey, Ghana, Hong Kong, Australia and Brazil were up from year ago levels.

So Canada seems to benefitting on two fronts. The stronger dollar and the quick economic turnaround are causing Canadian companies to increase their purchases of American goods and companies. The recovering Global markets are allowing Canadian companies to increase their exports to a diversity of countries.

This is also a very positive scenario for the U.S. A fast recovering Canadian economy is helping pull the U.S. into a quicker recovery. Strong international markets are keeping Canadian companies in good financial health, propelling them to buy more American goods.

Many sports fans throughout North America have been amazed by an event that played out over the past couple of weeks, namely the defeat of the Washington Capitals by the Montreal Canadiens. What made this hockey playoff event so interesting was that the 8th place team defeated the first place team in a best of seven game hockey series. What does have to do with trucking? For me there were a lot of parallels. I will explain.

Winning a best of 7 game hockey series is different from a 96th seeded tennis player defeating a number 2 seed. A singles tennis match is between two players. Hockey games are played by teams with multiple sets of players. Many top tennis players have off days. However to lose 4 games over a two week period is a different story. It is not about playing one bad game or set but about being defeated on 4 different occasions.

For most of the season the Montreal Canadiens were a mediocre team, barely securing the last playoff spot in their division. The Washington Capitals were the class of the division with some of the elite players in the game. The Caps team finished 33 points ahead of Montreal in the regular season. Very few hockey experts gave the Canadiens much chance of winning this series, particularly after they fell behind 3 games to 1. Most hockey fans gave them up for dead.

So what happened? Some hockey experts are giving all the credit to Montreal’s young goalie, Jaroslav Halak, who was excellent in the Canadiens’ last 3 victories. There is no doubt that he performed at a very high level and was a big factor in the team’s success.

But the explanation for the team’s success goes back to the off season. The team’s head of hockey operations, Bob Gainey, had a vision of the kind of team that he was looking for. In an unprecedented move, he replaced nine players on the team. A number of small skilled forwards joined the team. Several new defensemen were brought in. A number of very experienced veterans including the team’s former captain were moved out. He also hired a new coach.

For most of the year, the vision did not translate into success. The team was inconsistent. Mr. Gainey left the organization. Then something unusual began to happen.

The team began to execute on Mr. Gainey’s vision. The team bought into the plan of the coaching staff. The small speedy forwards skated hard. A top defenceman was brought in from a minor league team to replace an existing veteran in the playoffs. The players checked the Capitals as hard as they could. The team took away the time and space from the star forwards on the Caps team. The Caps’ best player, Alexander Ovechkin, was forced to shoot the puck from the outside lanes. Everyone on the team bought into the idea of blocking shots. The young goalie played brilliantly. The result was that David defeated Goliath.

The lessons for trucking firms are very clear. The leader of the company must have a vision of what his trucking company must do to win. The leader must hire a management team that can train, motivate and lead its employees to execute on the vision of the owner or CEO. The players must all be committed to executing the game plan and the game plan must be realistic and achievable. The lesson learned is that a cohesive, well motivated team, that can execute a well thought out game plan, can compete with their less well coached industry giants and win.

Can the Habs do it again? Well the element of surprise is gone. Enjoy the series.