Why Inbound Visibility Is Critical For Well-Run Supply Chains

  2021 03 23 Supplier Visibility

We at project44 take the view that companies in today’s delivery economy can no longer afford to have information blind spots when it comes to the actual arrival time for their prepaid inbound truck shipments. Typically, when the supplier pays for the shipping costs, the buyers lack in-transit visibility of the motor carrier bringing in the parts or products.

When the carrier does not meet its scheduled arrival time, the missed delivery window impacts the receiving company’s entire operation, resulting in dock congestion, higher labor costs, inventory shortages, impaired customer service, and even disruptions to production and sales. 

Prepaid Shipments Lack In-Transit Visibility

With prepaid shipments, the supplier owns the responsibility for delivering the goods from its warehouse or plant to the buyer’s distribution center or store. Because the supplier selects the carrier and arranges for the over-the-road transportation, typically the vendor only gives the buyer a date and time for the delivery.

But the lack of in-transit visibility can create a host of problems for the receiving company when the trucker doesn’t honor its time commitment. Whenever a truck shows up late — or even early — that impacts the work efficiency of the receiving company. Inbound shipment delays are especially harmful to manufacturers who need the parts delivery to keep production up and running. Early or late arrivals can wreak havoc on retailers who are engaged in cross-docking to resupply stores and maintain shopping inventories.

Off-schedule Deliveries Result in Dock and Yard Congestion

Late and even early deliveries have a direct impact on work efficiency because the receiving company may not have staff available for truck unloading. Off-schedule deliveries result in dock congestions, making unloading freight less efficient as enough hands aren’t available for multiple trucks. Missed appointments can also result in higher labor costs as the receiving company has to pay overtime to keep workers beyond their allotted work schedule to put away goods.

When receiving crews are stretched, it creates yard management issues as trucks have to wait longer for unloading before the drivers can get back on the road. Not only does yard overcrowding impact the receiving company, it can also blowback on the supplier, who often gets hit with penalties for increased dwell time from trucks waiting in line to unload their freight.

With companies today trying to maintain minimal stock of product or parts to meet demand, the delicate balance of inventory holdings is often upset by off-schedule deliveries. When the demand planners or inventory specialists don’t have real time-visibility into when their orders are arriving, they often hold onto additional stock, resulting in excess inventory.

Inbound Visibility Optimizes Warehouse Labor, Yard Flow, and Reduces Inventory Costs

The 247 fast pace of modern supply chain operations means that companies can’t rely on manual processes to understand the status of their suppliers’ freight movements. With in-transit visibility of inbound shipments, the receiving company gets the ability to track supplier shipments. An accurate picture of estimated arrival times gives the receiving the company the flexibility to make adjustments in operations for early or late truck shipments. Armed with insightful information, a company can juggle work assignments to have enough hands available to unload trucks and manage yard assignments. The end result in improved warehouse labor optimization, increased yard optimization, and reduced inventory costs.

Blindspot Removal Enables Corrective Action

Most important of all, inbound shipments visibility enables a company to be proactive and take corrective action on production or distribution from upstream shipment delays so it can minimize disruptions to production and sales. By having a real-time picture of inbound shipments, the receiving company can more closely collaborate with trading partners and carriers so they can all work together to reduce friction in the supply chain.

The project44 platform is now providing functionality to address the lack of inbound transit visibility. Go here to read our press release about this new functionality: project44 Introduces Supplier Visibility.