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The Last Mile

Logistics — industry’s last line of defense on costs

1300 E. 9th Street

Shippers face Cleveland, OH 44114-1503


216.696.7000 216.696.2737 fax
www.logisticstoday.com

a trillion-dollar challenge Business

Publisher Advertising Services


Manager
Newt Barrett
If you want to impress your friends, rise in for-hire inter-city motor carriage and 216.931.9570 Maryann Javorek
drop this number on them: various other transportation cost rises that nbarrett@logisticstoday.com 216.931.9288
mjavorek@logisticstoday.com
$1,493,000,000,000. No, it’s not Bill Gates’ took the total transportation bill to $593 bil- Associate Publisher
net worth — it’s the value of U.S. business lion — 63% of total logistics costs. How- Robert G. Rosenbaum Production Manager
216.931.9673 John Gudel
inventories in 2003. You played an impor- ever, logistics professionals met the chal- brosenbaum@logisticstoday.com 216.931.9429
tant role in moving and managing those in- lenge of increased transportation costs, rising jgudel@logisticstoday.com
Group Administrative Manager
ventories. More importantly, you were the security costs and lengthening supply chains Christine M. Marinez Circulation Manager
last line of defense on the costs your com- to keep it all under control. 216.931.9547 Antoinette Sanchez-Perkins
cmarinez@logisticstoday.com asanchez@logisticstoday.com
pany incurred to produce and deliver prod-
uct to your end customer. Some of the toughest challenges are Group Marketing Manager Business Manager
Pamela J. Hardy Chuck Greisemer
We’ve used the Rodney Dangerfield line, ahead. Tighter capacity is driving transporta- 216.931.9898
Custom Media Group
“I don’t get no respect” before, but it’s time tion costs higher still in all surface modes. phardy@logisticstoday.com
Joe Pulizzi
we adopted the BASF marketing approach. Interest rates are about to start moving up- Online Coordinator Director
Try this on for size: “We don’t make the ward. And the peak shipping season is yet to Carrie Drozdz 216.931.9566
216.931.9482 jpulizzi@penton.com
product — we make it affordable.” come. To end the year on a positive note, cdrozdz@logisticstoday.com
That’s bound to raise some questions. you’ll have to pull out all of your skill and Angela Vannucci
Classified Advertising Associate Director
How can you claim to have so much impact apply it diligently to managing the flow of Jason Washburn 216.931.9159
on a product and its final delivered cost? goods through the end of the year. 216.931.9511 avannucci@penton.com
Let’s put on our forensics hats and dust any In the longer term, warehousing costs will jwashburn@logisticstoday.com

given carton for fingerprints. How many rise as changing supply chains necessitate Vice President/
Group Director
times was that carton touched, moved, reconfiguration of your distribution network. Robert F. Eck III, CBC
stored, transported from origin to the final And the toughest challenge will be connect-
customer? ing demand and supply in a more timely Advertising Sales
Let’s go a step further and deconstruct the manner that improves response. The first EASTERN REGION .................................................................. Randi Cohan
product and follow its components back to hurdle will be getting timely data from Phone: 516.897.0683, Fax: 516.897.0684
rcohan@logisticstoday.com
their origin. Have we arrived at raw ores in demand points. The real logistics magic will
the ground yet? If not, keep going. How be when you can turn the supply on and off CENTRAL REGION............................................................. Bob Rosenbaum
Phone: 216.931.9673, Fax: 216.696.2737
many touch points did you come up with? without producing waste. brosenbaum@logisticstoday.com
My bet is the number will begin to resemble Keep in mind — some of the transit times WESTERN REGION . .......................................................... Peggy Diedrichs
Phone: 415.339.0481, Fax: 415.339.0472
the one in the first paragraph pretty quickly. you’ll be dealing with stretch from 14 to 21 pdiedrichs@logisticstoday.com
Though logistics costs have continued to days by sea. If you want to respond and keep ENGLAND ........................... Paul Barrett, Mark Whiteacre, David Moore
rise in some areas, logisticians have man- costs down, you can’t just shift to air. Phone: 44-1268-711-560, Fax: 44-1268-711-567
aged components of logistics You should already be dig- FRANCE ........................................................................... Fabio Lancellotti
Phone: 331-4294-0244, Fax: 331-4387-2729
and physical distribution ging deep to find an effective ITALY .............................................................................. Cesare Casiraghi
Phone: 39-31-261407, Fax: 39-31-261380
very well. Witness the logistics strategy to support BELGIUM, HOLLAND ........................................................... Peter Sanders
current $936 billion bill for the supply lines your manu- Phone: 31-299-671303, Fax: 31-299-671500
logistics services. Though facturing and procurement TOKYO ............................................................................... Yoshinori Ikeda
Phone: 813-3661-6138, Fax: 813-3661-6139
the bill for logistics rose divisions have established. SEOUL, KOREA ................................................................... Young Sang Jo
Phone: 822-739-7840-2, Fax: 822-732-3662
nearly 3% in 2003, logistics They will only remain the TAIWAN . .................................................................................. Charles Liu
costs as a percentage of cost-effective solutions they Phone: 886-2-707-5829, Fax: 886-2-707-5825
gross domestic product were intended to be if you can CHINA .......................................................... Ballycastle Trading, Inc. Ltd.
Phone: 852-524-7256, Fax: 852-524-7027
(GDP) fell to an all-time low control the logistics costs. INDIA ..................................................................... .Shivaji Bhattacharjee
Phone: 91-11-268-7005, Fax: 91-11-2652-6055
of 8.5%. Taken another way, Some of those costs are going SINGAPORE .............................................................................. Mike Seah
logistics reduced its portion up, and you can’t stop them. Phone: 65-299-0413, Fax: 65-758-7850 or 65-296-6629
of the cost of goods sold You’ll have to get everyone
(COGS to your accounting onboard and looking at total
department). delivered cost, or we’ll all be
It’s true that interest rates Rodney Dangerfields again. Thomas L. Kemp, Darrell C. Denny
remained at unprecedented Chairman & Chief Executive Officer Executive VP & President, Penton
Daniel J. Ramella, IT & Lifestyle Media Groups
lows for nearly a year, help- Perry A. Trunick President & Chief Operating Preston Vice
ing to offset a $15 billion executive editor Officer/President, Penton Chief Financial Officer &
Industry & Retail Media Division Corporate Secretary
William C. Donohue, R. Thomas Jensen,
Executive VP & President, Chief Technology Officer & VP/
Penton Retail Media Group Database Marketing Services
David B. Nussbaum, Katherine P. Torgerson,
Executive VP & President, SVP/Human Resources
Penton Technology & Lifestyle Mary E. Abood,
Media Division VP/Corporate Communications

54 JUL 2004 www.logisticstoday.com L O G I S T I C S T O D A Y