czarliteeffectivebenchmarking_whitepaper

E f f e c t i v e P r i c e B e n c h m a r k i n g

w i t h L T L’ s M o s t P o p u l a r B a s e R a t e

An SMC³ White Paper August 2009

C Z A R L I T E W H I T E P A P E R , A U G U S T 2 0 0 9

Introduct ion right

Benchmarking ForPredictabi l i ty & Consistency right

A C O M M O N L A N G U A G E

F O R C O M M E R C E r i g h t

The Case For A True LTLPrice Benchmark 2

W H Y A L L LT L D E A L S A R E

N O T E Q U A L 2

T H E P R O B L E M W I T H

C U S T O M S H I P P E R T A R I F F S 3

Successful LTL Benchmarkingwith SMC3 CZARLITE ® 3

C Z A R L I T E U S E R D E M O G R A P H I C S 3

K E Y P R O D U C T C H A R A C T E R I S T I C S

& D I F F E R E N T I A T O R S 4

T H E I M P O R T A N C E O F R E G I O N A L LY

B A S E D LT L E C O N O M I C S 4

Bui l t To Last: Why CZARLITE Is Here to Stay 6

I N D E X I N G C A R R I E R S ’ C O S T S

T O D O B U S I N E S S 6

M A I N T A I N I N G Z I P C O D E

A C C U R A C Y 6

I N D E P E N D E N T V E R I F I C A T I O N 7

Conclusion 7

More About SMC3 8

Information Sources 9

C O N T E N T S I N T R O D U C T I O N

The once-humble surveyor’s benchmark has evolved into a

highly sophisticated analytical approach and management

practice. Today “benchmarking” is used by businesses

worldwide to compare cost, cycle time, productivity,

financial performance or quality against a standard or best

practice. Uniform, actionable data, content and business

rules are at the heart of benchmarking. Its ultimate goal is

to facilitate informed business decisions that will, in turn,

support strategic, operational efficiency and financial

goals and help assure consistent, predictable performance.

In this white paper, we explore general management

benchmarking best practices; benchmark pricing examples;

superior LTL benchmarking characteristics; and the specific,

tangible business benefits and value benchmark pricing

tools provide to LTL freight purchasers and vendors alike.

B E N C H M A R K I N G F O R P R E D I C TA B I L I T Y A N D C O N S I S T E N C Y

Benchmarking best practices are a business cornerstone of

effective metrics-based organizations worldwide—no matter

what their strategic, operational, process or financial

goals. Benchmarking best practices rely on a combination

of systematically updated information, which serves as a

stable metric for making informed decisions; unbiased

information, which is collected and distributed independent

of external influences; and widespread usage, so the benchmark

or benchmarking process can serve as common ground for

negotiations. Fortune 500 companies embrace universal

benchmarking methods as a systematic way to achieve strategic

and revenue objectives. Small- and medium-sized companies

embrace the strategic value of establishing a basis for

performance and business processes improvement. All seek

to enhance and secure their competitiveness with

benchmarking.

A C O M M O N L A N G U A G E F O R C O M M E R C E

Many august benchmark-development organizations and

benchmark pricing indices have attained regional, national

and global scope and influence, with the ultimate goal being

a common language by which users can conduct commerce.

Financial Benchmarks and Benchmarking: Financial benchmarks

are at work in most global financial markets, including

equities, foreign exchange and interest rate derivatives.

While there are many pricing models, the Black-Scholes model

(and some of its “knock-offs”) is generally regarded as the

quintessential financial pricing benchmark.1

c o n t i n u e d , n e x t p a g e

“ B e n c h m a r k i n g i s a n o n g o i n g o u t -r e a c h a c t i v i t y ; t h e g o a l o f t h e o u t r e a c h i s i d e n -t i f i c a t i o n o f b e s t o p e r a t i n g p r a c -t i c e s t h a t , w h e n i m p l e m e n t e d , p r o d u c e s u p e r i o r p e r f o r m a n c e . ”

Bogan and Engl ish,

Benchmarking for Best

Pract ices


P A G E 1

U.S.financial benchmarks include bond yields (generally

compared to benchmark yields on U.S. Treasury securities

of similar maturity) and the Standard & Poor’s 500

Index and the Dow Jones Industrial Average (the most

widely followed benchmarks or indicators of the U.S.

market for large-company stocks and funds that

invest in those stocks).

Multi-Industry Management Benchmarks and

Benchmarking: The members of the International

Standards Organization (ISO)—a worldwide federation

of national standards bodies from over 100 countries—

collaborate to develop and promote universal

management benchmarks and standards used in

industries ranging from manufacturing to communication.

ISO certification assures internal operational, product

and service compliance and excellence.

Energy/Commodities Benchmarks and Benchmarking:

Perhaps the most widely accepted benchmarks

are in the energy sectors:

•Oil is priced using benchmark pricing or

“price markers” that link local prices to publicly

traded benchmarks like NYMEX WTI crude oil

and IntercontinentalExchange® (ICE) Brent

crude oil.

•The Argus/McCloskey Coal Indices often serve

as the benchmark price for coal markets.

•Reuters RICs and history for the Argus liquefied

petroleum gas (LPG) dataset is the benchmark

pricing source for LPG markets.

•Steel Benchmarker™ draws information from

almost 1,000 steel buyers, sellers and users

and provides benchmark pricing data (these

information providers and pricing assessment

inputs are anonymous and in compliance with

U.S. and European Union anti-trust and

competition laws).

•The Energy Information Administration (EIA)

at the U.S. Department of Energy (DOE) provides

unbiased, policy-neutral energy data, forecasts

and analyses to promote efficient markets.

EIA’s data products cover energy production,

stocks, demand, imports, exports and prices.

Companies worldwide rely on EIA content to

make informed strategic and operational decisions.

$2,250

$1,750

$1,250

$7500800 1200 1600

Carrier C

Carrier B

Carrier A

Shipment ProfileClass: 77.5

Shipment Weight: 1,500 lbs

Origin ZIP Code: 30269

Key Point Miles

Sh

ipm

en

t C

ost

Figure 1. Three individual carriers’ pricing programs for the same average LTL shipment traveling from and to the same origin and destination locations fluctuate widely, causing even savvy LTL purchasers to question whether they received the best pricing scenario.


P A G E 2

“ T h e u s e o f o n e t a r i f f l i m i t s c o m p l e x i t y f o r t h e s h i p p e r a n d s i m p l i f i e s t h e c o m p a r i s o n o f LT L b i d s … C z a r L i t e u s e h a s i n c r e a s e d a s a s t a n d a r d t a r i f f f o r m a t . S h i p p e r s may pre fe r CzarL i te b e c a u s e i t i s ‘ ca r r ie r neut ra l ’ . . . ”

Norbr idge, Inc. , LTL Pr ic ing Ef fect iveness Research Study4

T H E C A S E F O R A T R U E LT L P R I C E B E N C H M A R K

The old adage “information is power” is a new truism

for companies sourcing freight within today’s ultra-

competitive LTL environment. There is literally no

margin for making flawed business decisions based

upon inaccurate information or faulty assumptions.

Despite economic upheaval and a ferociously competitive

LTL market, some carriers and shippers continue to

forgo base rate benchmarking. But lacking a shared

pricing benchmark, the integrity of both parties’ short-

and long-term planning processes can become

compromised.

The North American LTL carrier pool has con-

tracted dramatically, and industry consolidation is

leaving only the fittest, best-capitalized carriers

standing—companies with considerable power, who

have learned how to obtain significant revenue

yields on a lane-by-lane basis. As the Canadian

Web site trucknews.com recently reported,

“Shippers should not be lulled into a false sense of

security that there is a lot of capacity. Two thou-

sand six hundred and ninety (2,690) trucking

companies went bankrupt or closed through mid-

November [2008], with more to come. … That kind

of capacity drawdown will leave a major dent when

the economy finally turns around.”2

True LTL benchmarking—where shippers and carriers

employ reliable, fuel- and direction-neutral

baseline LTL rates to manage mutually successful

outcomes and reliable sourcing—has become core

to doing business.

W H Y A L L L T L D E A L S A R E N O T E Q U A L

LTL shipment handling costs vary greatly for carri-

ers, depending on whether the shipment is local,

regional or long haul. For example, short-haul regional

shipments have a higher percentage of their over-

all cost at the terminal level, while longer haul

interregional and transcontinental shipments have

a higher percentage of cost in their linehaul oper-

ations. These cost differentials play out in

various ways in individual carriers’ tariffs, and

introduce unnecessary pricing complexity when

used as a base rate.

An individual carrier’s “base rate alternative”

rarely incorporates a historical maintenance

perspect ive, and may simply use a basic or even

out-of -date price/ZIP code matr ix that does not

ref lect current postal code complexity. So -cal led

“ free” rates of ten come with substantial fine

print and subsumed goals; therefore, all LTL

deals are not created equal.

0%

10%

20%

30%

40%

50%

60%

70%65.17%

38.50%

17.74%

35.70%

7.90%

15.90%

8.50%8.47%1.50%0.72%

Linehaul P&D Terminal Hub Administrative

NationalCarrier

RegionalCarrier

Transportation Activity

Op

era

tin

g C

ost

Figure 2. The relative share of cost varies dramatically between national and regional carriers due to differences in the length of haul, average weight per shipment, traffic density, terminal network and equipment.


Strategic Marketing Goals: Individual carriers

use their pricing to tailor their rates to market

conditions. As conditions and strategies change

for carriers and shippers, the shipper is not

always provided a viable means to change

their current pricing.

System Distribution Goals: Individual carriers’

tariffs are designed to give them the advan-

tage, since their pricing is based on their

specific head-haul lanes, deadhead, through

rate, turn around, differential routes, peddle runs,

needed back haul, terminal locations, traffic

patterns and lane imbalances. An inbound

premium covers a vehicle’s less-profitable

return trip to its origin terminal, and carriers

offset circuitous routings and empty or low-

capacity miles in short-haul lanes with

additional charges.

Profitability Goals: Carriers simply cannot supply

every transportation solution to every shipper;

they are limited by their terminal systems and

geographic range. Each market has a unique set

of operational challenges and associated costs.

Profitability is a function of the price/cost

ratio and is often adjusted in the rate to or

from these areas. There is a severe cost

disjuncture when regional carriers are forced

to do business out of their normal areas of

operation. Thus, the shipper may be paying for

individual carriers’ operational decisions—

although those costs were not incurred by

the freight.

T H E P R O B L E M W I T H C U S T O M S H I P P E R T A R I F F S

On the flip side of the coin, very large shippers

and logistics service providers have created their

own shipper-optimized tariffs to cherry-pick the

lowest-priced freight movements. However attractive

these tariffs may seem for shippers, this approach

also contains inherent risks: When carriers gain

pricing strength in an economic turnaround and are

no longer “low-balling” to garner shipper business

and meet their fixed costs, they will most likely

be unwilling to price using today’s “strategically

optimized” shipper rates. These vanity tariffs will

be the most obvious agreements for carriers to

renegotiate or do away with.

SUCCESSFUL LTL BENCHMARKING W I T H S M C ³ C Z A R L I T E ®

To work effectively and reliably over time and

through the twists and turns of a global economy, an

LTL price base must be fair, balanced, and maintain

a fuel- and direction-neutral basing system. It must

also closely benchmark key independent data as

well as draw from a transportation network and the

frequently updated, well-understood postal and

ZIP code assignments. Above all, it must be able to

express and maintain all the aforementioned infor-

mation in an efficient, effective database that

delivers key decision-making information on time

to shippers and carriers alike.

Industry-standard SMC3 CzarLite® is a trusted,

predictable pricing benchmark. Refined over 21

years, CzarLite is used routinely throughout North

America as the basis for thousands of successful

shipper, carrier and logistics service provider

pricing agreements that represent several billion

dollars in annual managed transportation spending.

C Z A R L I T E U S E R D E M O G R A P H I C S

CzarLite relies on the periodically updated SMC3

Carrier Cost Index (CCI), regionally based economics

and independent verification of the update process

to enable shippers and carriers from all areas of

commerce and transportation to make wise choices:

Several branches of the U.S. government employ

CzarLite to process literally thousands of competing

motor carrier rates and maintain control over

their massive LTL transportation needs.


20% Other Carrier Tariffs

11% Own Carrier Tariffs

69% Other Tariffs

Source: Norbridge and Associates

Shippers’ Use of Benchmarks

P A G E 3

Benchmark pricing has been a normal practice in the LTL industry for many years. A study by Norbridge and Associates showed 89 percent of a carrier’s customers use price lists other than the carrier’s for “benchmarking” their freight. The same study determined that CzarLite is the most popular non-carrier tariff.4

Nearly half of the Fortune 500 and more than

2,000 shippers, including some of the largest

U.S. logistics service providers, use CzarLite

to optimize their LTL purchasing processes;

secure long-term value and core carrier capacity;

and adjust their freight services to meet their

transportation planning needs and strategic

business goals. CzarLite serves as a critical

negotiating tool for securing and affirming

competitive carrier pricing and automating

shippers’ contracts.

Over 375 carriers, including all 50 of the

largest national, multi-regional and regional

LTL carriers use CzarLite with shipper-customers

to negotiate single and joint-line movements;

eliminate rate disputes with connecting carriers;

develop their overall pricing offers; secure

freight that supports their operational

strengths and goals; avoid pricing hazards like

freight mix changes, artificially inflated

regional pricing and DC relocations; improve

productivity; reduce request for pricing (RFP)

expenses; and compare shippers’ historical

freight statistics with marketplace statistics to

determine shippers’ shipment profiles.

Benchmark pricing has been a normal practice in

the LTL industry for many years. A study by

Norbridge and Associates showed 89 percent of a

carrier’s customers use price lists other than the

carrier’s for “benchmarking” their freight. The

same study determined that CzarLite is the most

popular non-carrier tariff.

K E Y P R O D U C T C H A R A C T E R I S T I C S A N D D I F F E R E N T I A T O R S

Delivered via Web services (also known as service-

oriented architecture, or SOA) or other engines

for PCs, networks and UNIX, CzarLite supports a

wide range of transportation and warehouse

management systems as well as enterprise

resource planning systems. Reliable benchmarking

is only one CzarLite benefit; it also brings value

through reduced operational and labor costs, ease

of integration, quick ramp-up times, common

terminology and rules that facilitate internal and

external communication, borderless pricing and

proven technical support.

All CzarLite products—including SMC³

MexicoLite™ and SMC³ CanadaLite™—are designed

to help users establish pricing details that correlate

with each of their carrier agreements, including

discounting, minimum charges, fuel surcharges

(by individual carrier or national average) and

FAKs. Robust discounting features allow simple

discounts, weight break discounts or discounts

attached to very specific geographic lanes.

T H E I M P O R T A N C E O F R E G I O N A L L Y B A S E D L T L E C O N O M I C S

CzarLite is designed to handle the anomalies as

well as the economic and geographic complexity

of North America’s many regions, which affect

carriers’ ability to price and move LTL freight and

shippers’ transportation rates. The factors

CzarLite takes into consideration are:


F O R T H E I R P A R T , C A R R I E R S :

• Develop their overall pricing offers

effectively and benchmark industry

standards at regional, multiregional,

transcontinental and North American

market levels

• Gain access to freight that supports their

operational strengths and goals

• Improve productivity and reduce expense

when replying to RFPs

• Determine shipment profiles by

comparing a shipper’s historical freight

pricing statistics with marketplace

statistics

W I T H C Z A R L I T E , S H I P P E R S A N D L O G I S T I C S S E R V I C E P R O V I D E R S :

• Make wise logistics choices by assessing

annual bid awards to carriers

• Survey general pricing availability in

various markets

• Ensure carrier rate competitiveness

• Standardize critical areas of their

business operations, including accounting

functions, computer systems, purchasing

agreements and RFPs

• Increase productivity and overall

efficiency for greater profitability and

competitive end-customer pricing

P A G E 4


• State and regional labor expenses

• Weather-related costs

• Speed, weight and restricted road limits

• Load factors

• Freight flow costs, traffic congestion

• Local, state, county and city laws and restrictions

• Chronic head-haul imbalances into New York

City, Washington, D.C., and Florida

• Additional operational expenses, such as tolls

and access fees, and restrictions, such as time-

limited road access, bypasses, etc.

For example, the heavily populated Northeast has

a highly unionized labor force and considerable

urban congestion. Trucks are limited by interstate

highway congestion and often operate on surface

streets. Conversely, the Southeast has less-expensive

labor, less-congested roads, and high-speed road

access with higher speed limits. And unlike some

carriers’ individual pricing systems—which use

one level of rates for intrastate freight pricing and

another for interstate freight pricing—CzarLite

simplifies intrastate pricing, which is based on

regional pricing for the corresponding interstate

movements. For example, CzarLite’s transportation

cost for freight traveling 200 miles between

Georgia and North Carolina is the same as a

corresponding shipment moving between two

points in Georgia or two points in North Carolina.

This eliminates analysis, billing errors, and discount

negotiation and administrative management problems—

an important feature if a shipper’s logistics

patterns include regional distribution or a local

customer base.

Figure 3 compares two individual carriers’

inbound and outbound rates versus CzarLite for

the same shipment moving from Phoenix, Ariz. to

nine U.S. points. CzarLite price increases are

uniform across distances, while carriers’ rates

fluctuate based on individual lane requirements

and revenue goals to and from the target city.

The SMC³ CzarLite, CanadaLite and MexicoLite

base rate systems are aligned to provide consis-

tent rating throughout North America (as shown

in Figure 4):

• MexicoLite enables shipments to move

between any point within the United States

and the Mexican border crossing point under

the standard, established CzarLite rates, while

the distance from the border crossing point to

the Mexican destination is rated for the Mexican

portion of the move. For convenience, these

P A G E 5

National OB

Regional OB

National IB

Regional IB

Czarlite IB/OB

Distance

Ra

tes


Figure 3. Carriers tailor their inbound (IB) and outbound (OB) rates to reflect individual operational and marketing objectives. CzarLite rates trend uniformly on an IB and OB basis without unknown headhaul or backhaul adjustments.

rates are presented as through rates from the

point of origin to the point of destination.

• CanadaLite enables a shipment to move

between any point within the United States

and a Canadian border crossing point under

the standard, established CzarLite rates.

B U I LT T O L A S T: WHY CZARLITE I S HERE TO STAY

I N D E X I N G C A R R I E R S ’ C O S T S T O D O B U S I N E S S

The SMC3 Carrier Cost Index is designed to sup-

port CzarLite regional benchmark pricing and is

a key factor at the “heart” of the CzarLite update.

Unlike other supposedly “indexed” base rates—

which may draw from irrelevant indices—the CCI

is based on a statistical subset of regional U.S.

Department of Labor, Bureau of Labor Statistics

Consumer Price Index (CPI) and Producer Price

Index (PPI) 3 data and:

• Tracks motor carrier costs

• Eliminates CPI items that are not part of motor

carrier costs (e.g., entertainment, produce,

timber, food, liquor, etc.)

• Assigns a weighted, regional cost

• Allows interregional or “overhead” pricing

that reflects cost characteristics of the

transcontinental freight market

• Quantifies carriers’ labor expenses (including,

for example, salaries, wages and fringe benefits)

and non-labor operational expenses (for example,

equipment depreciation, amortization, general

supplies, insurance, rentals, etc.)

M A I N T A I N I N G Z I P C O D E A C C U R A C Y

CzarLite’s pricing accuracy relies on biweekly ZIP

code system updates from the U.S. Postal Service

(USPS). But these updates generate a staggering

amount of data, resulting in 1,676,738,704 unique


P A G E 6

U.S. Western

U.S. Pacific Northwest

U.S. California Intrastate

U.S. Middle West

U.S. Southwest

U.S. Southern

U.S. Central

U.S. Eastern

Canada Region 1

Canada Region 2

Canada Region 3

Canada Region 4

Mexico Region 1

Mexico Region 2

Mexico Region 3

Mexico Region 4“ T h e S M C 3 C C I appl ies to spec i f i c , i d e n t i f i a b l e e x p e n s e s , a l i g n i n g t h e p r o c e s s w i t h t h e r e c o m m e n d a -t i o n s o f t h e B u r e a u o f L a b o r S t a t i s t i c s . ”

Figure 4. CzarLite’s comprehensive regional, inter-regional and international pricing supports accurate LTL decision making throughout North America.


U.S. lanes (origin-destination pairs). To add to

code maintenance complexity, each CzarLite

change—which varies from the extremely large

ZIP code boundaries in the western United States

to the unique pricing challenges posed by areas

like the Chicago Loop, Puget Sound, the Florida

Keys, and California—must be individually investigated

and aligned with the proper ZIP code rate.

California, for example has over 10 percent of the

total U.S. population, large shipment volumes,

generally smaller shipments, and unusual traffic

patterns that must be adjusted to insure equitable

pricing for both shippers and carriers.

To deal with these many complexities, CzarLite

employs an “intelligent hybrid” of three- and five-

digit ZIP codes and state-of-the-art software that

gives users the most granular, accurate, and cost-

efficient information available to make highly

informed strategic pricing/cost decisions, avoiding

overcharges and undercharges. This hybrid system

has an additional payoff: a smaller, faster engine

able to rate 50,000 shipments per minute.

I N D E P E N D E N T V E R I F I C A T I O N

The CzarLite, CanadaLite and MexicoLite benchmarks

are periodical ly updated to assure accuracy.

These updates are guided by the regional and

interregional changes in the CCI, resulting in

updates to the rates. The economic update process

is carefully vetted by industry experts: An independent

Certified Public Accountant (CPA) verifies the

application of the SMC3 documented process and

the product’s mathematical accuracy, and an

outside economic review panel comprised of

economic and supply chain subject matter experts

carefully reviews any proposed changes to the

benchmark, assuring a practical, fair and carrier-

neutral approach.

C O N C L U S I O N

Like other professionals throughout the world

who use highly accurate benchmarks and benchmarking

best practices to assure their organization’s progress

and success, savvy LTL purchasers throughout the

United States and North America succeed when

they utilize benchmarks and best practices to

accurately, consistently and predictably manage

their transportation pricing agreements.

CzarLite base rates are the tool of choice for many

organizations in their daily supply chain management

activities, because they predictably and consistently

provide a common language for commerce—and they

are fairly indexed according to carriers’ costs to do

P A G E 7

$2,250

$1,750

$1,250

$7500800 1200 1600

Key Point Miles

Carrier C

Carrier B

Carrier A

SMC3 CzarLite

Shipment ProfileClass: 77.5

Shipment Weight: 1,500 lbs

Origin ZIP Code: 30269

Key Point Miles

Sh

ipm

en

t C

ost


Figure 5. The graph below re-plots individual carrier rates from Fig . 1 with CzarLite pricing, represented by the green line, showing CzarLite’s uniformity over distance.

business without being biased toward any individual

carrier’s operational structure.

M O R E A B O U T S M C 3

Founded in 1935, SMC3 is devoted to consistently

raising the level of knowledge, collaboration and

technological capability in the freight transportation

marketplace. We achieve this by using our internal

expertise and industry connectivity to provide the

best data, content, technology and educational

services to our members, customers and associates.

Our deep-seated core values of integrity, consistency,

thought leadership and operational excellence

support this mission and provide a foundation for

our unique portfolio of industry solutions.

Shippers, carriers and logistics service providers

look to SMC³ for the technology, industry data,

educational services and general know-how they

need to achieve greater success in the transportation

marketplace.

T E C H N O L O G Y A N D P R O D U C T S T O F U R T H E R S E C U R E Y O U R K E Y L T L B U S I N E S S R E L A T I O N S H I P S

CzarLite’s value is enhanced through integration

with SMC3 companion products. Often delivered

via an SaaS delivery model, these products assure

complete freedom of choice among a wide range

of hardware, operating systems, databases and

software applications and eliminate systems

integration issues:

A vital part of the new SMC3 portfolio of products,

the SMC3 CarrierConnect™ XL database combines

carrier operational capabilities, points of service,

transit times, hours of operation and terminal-to-

terminal network information into one easy-to-use

system. More than 150 participants’ data files

represent the industry’s leading national, interregional

and regional LTL carriers, plus select truckload

carriers. Shippers can easily add niche carriers;

view detailed, terminal-level carrier contact

information; make accurate routing decisions with

regular data/content updates; audit freight bills;

and review effective dates for auditing carrier

on-time performance.

SMC3 RateWare® XL totally accurate and timely

rate calculations, delivered via SOA to speed

critical information to accounting, purchasing,

transportation planning and other shipper business

functions requiring transportation pricing content.

Unlike RateWare, many technology offerings miss

the point—and key inputs, such as line item discounts,

FAK calculations, floor minimums, and other


P A G E 8

0

10

20

30

40

50

60

70

80

90

100 150 200 250 300 350 400 450 500 550 600 650 700 750 800 850 900 950 1000 1500

Distance

Co

st

NortheastRegion

Central/Middle WestInter-regional

Southeast Region

Southwest Regional

CzarLite Rating Curves

Figure 6. As distance increases CzarLite provides smooth, predictable, omni-directional benchmark rating across regional, inter-regional and transcontinental territories.

shipment rating details. The result: Wrong carrier

assignments and unexpected charges. Other’s

flawed workarounds rely on estimates and rating

modeling, instead of rate calculations. The result:

Quality errors. Still other offerings lack service

and transit times. The result: Inaccurate rates.

SMC3 Bid$ense® helps shippers and carriers achieve

the optimal carrier selection and maximize cost savings.

Automated RFP distribution and analytics support

operational excellence for all bid parties. Bid$ense

integrates seamlessly with CzarLite base rates, so

common rating structures are shared between carrier

responses for true “apples-to-apples” bid comparisons.

With complete, uniform shipment data from shippers,

carriers remove costly steps from their RFP response

process, reducing their pricing decision uncertainty.

Automated review-and-respond features save carriers’

time and expense.

Density-based transportation pricing is the default

approach for most of the world. The United

States—the only country in the world using

class-based LTL pricing—is catching up with the

global market with CzarLite density pricing.

Density pricing enables U.S. carriers to accurately

compute density-based LTL charges to or from a

U.S. port or between any two points within the

continental U.S. using SOA; and supports load-

planning software requirements for dimensional

data (to assure efficient trailer loading and cost

savings). With CzarLite density, foreign manufacturers

can bid their wares inclusive of transportation to

U.S.-based points and foreign customers can easily

price the inland U.S. portion of their shipment.

Lastly, carriers are free to price and sell to shippers

with greater flexibility, to meet individual customer

needs and performance goals.

I N F O R M AT I O N S O U R C E S1. Trade Technology Australia Web site (see:

http://www.tta.com.au/news/observing-the-risk/).

2. “Schneider Logistics Gives State of the Industry Overview,” http://www.Trucknews.com, April 13, 2009.

3. For CPI and PPI source information, visit the U.S. Bureau of Labor Statistics Web site (http://www.bls.gov/news.release/cpi.toc.htm and http://www.bls.gov/ppi/, respectively).

4. Norbridge, Inc. “LTL Pricing Effectiveness Research Study,” November 2002.

P A G E 9


A T L A N T A H E A D Q U A R T E R S

500 Westpark DrivePeachtree City, GA 30269

phone 770.486.5800 800.845.8090

www.smc3.com

Copyright © 2009 Southern Motor Carr iers Rate Associat ion, Inc. SMC3, Bid$ense, CzarLi te and RateWare are registered trademarks; CanadaLite, Carr ierConnect and MexicoLite are trademarks; and Pr ic ing Expert ise Del ivered is a service mark of Southern Motor

Carr iers Associat ion, Inc. Other brand and product names are the property of their respect ive owners. PI# 13998-L.

czarliteeffectivebenchmarking_whitepaper

Documents