Executive Summary

Context: Japanese food manufacturing shipping outbound to US wholesalers/retailers. LTL’s multi-terminal routing made lead times unpredictable and often extended, while increased handling touches elevated damage risk. 

What MTS did: Centralized all orders and owned planning as a BPO—designing load/route via MTS’s platform, prioritizing FTL/PTL with selective LTL, including multi-drop routing and appointment arrangement.

 Impact: ~20% transportation cost reduction, fewer delays and damages, lower secondary costs, and reduced internal planning workload.

Client Background

Japanese food manufacturer

The Challenge

What problem or need did the client have?

Reliance on LTL increases costs, while additional transit points raise damage risk and extend delivery lead times, posing challenges for MAD (Must-Arrive-By) requirements.

What were their goals?

Reduce total transportation cost (beyond rate savings), improve on-time performance and product integrity, and lower the internal workload tied to mode selection and quote comparison.

Why was this challenge significant?

Delays and damages triggered secondary costs such as retailer chargebacks/penalties, expedited reshipments, reconsignments/re-deliveries, overtime labor, and additional safety stock—impacting margins and customer satisfaction.

MTS’s Solution

Approach:
MTS received all outbound orders in the customer-required data format and input them into MTS’s own load/route planning system. Using this system, we orchestrated mode selection, consolidation, load/route design, time-feasibility checks, and appointment scheduling to meet must-arrive dates at the lowest total cost.

Key Actions Taken:

• Centralized order intake as a managed BPO service; MTS became the single planning owner.

• Data-driven mode selection: prioritize FTL/PTL through consolidation; keep LTL as a complementary option when consolidation is not feasible and lead time allows.

• Map-based planning to design multi-drop routes; verify all deliveries meet time windows; confirm weight and cube fit on assigned equipment.

• Coordinate pick-up and delivery appointments with origins and consignees; secure capacity and dispatch per the approved plan. 

Innovations or Customizations:

• Planning ownership model: Unlike typical carrier execution against a provided plan, MTS designed the plan and arranged capacity in one integrated workflow.

• In-house optimization tailored for dynamic consolidation, appointment-aware routing, and rapid scenario simulation based on the client’s order patterns.

Implementation

Timeline:
Data analysis and simulation; proposal alignment; system configuration; workflow validation; staged go-live by origin/lanes.

Obstacles & How They Were Overcome:

• Standardized fragmented data and resolved quality issues (normalization, outlier treatment, targeted imputation) to enable reliable planning inputs.

• Retained LTL as a governed exception: defined rules for when LTL is used (no feasible consolidation and sufficient lead time) to balance cost, service, and risk.

• Established cadence and ownership: bi-weekly reviews and clear RACI sped decisions and ensured alignment during the transition.

Results

Quantitative Outcomes:

• Approximately 20% reduction in transportation costs.

• Higher FTL/PTL share vs. LTL, lowering handling touches and transit variability.

Qualitative Outcomes:

• Substantial decrease in delivery delays and cargo damages.

• Marked reduction in internal planning workload due to MTS’s BPO model.

• Lower secondary costs: fewer chargebacks/penalties, expedites, re-deliveries, overtime, and reduced need for excess safety stock.

Before & After Comparison:

• Before: LTL-dominant outbound; variable/extended lead times and higher damage exposure; manual mode decisions across multiple quotes; mounting secondary costs.

• After: Data-driven FTL/PTL mix with selective LTL; improved on-time performance and product integrity; centralized planning and appointment management; mitigated chargebacks and expedites.

Conclusion & Key Takeaways

Summary of Success:
By centralizing order intake and owning load/route planning, MTS transformed an LTL-heavy outbound model into an orchestrated, appointment-aware network—delivering ~20% cost savings, stronger service quality, and reduced secondary costs and internal workload.

Lessons Learned:

• Assigning a single orchestrator for planning (BPO model) unlocks both freight and non-freight savings.

• Simulations on past record data accelerate alignment and de-risk rollout for MAD-sensitive retail/wholesale distribution.