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Cost to Serve solution

ORTEC (booth # 9426)

Summary of Innovation

ORTEC’s Cost to Serve solution is advanced analytics software that uses machine learning to identify delivery cost per customer for all supply chain industries. It does this by using customer attributes (distance to depot, service window, volume) to break down route cost and allocate per customer. With this new calculation model, you can more easily calculate customer profitability.

As an example, a fuel truck drives 10 miles from the depot to gas station A then another 10 miles from gas station A to gas station B before driving 20 miles back to the depot, delivering the same product and amount to both stations. Based on $2/mile, the total route cost is $80. With the Cost to Serve solution, it now weighs the impact of the attributes to determine customer specific cost which in this case the cost for station A for $47 and for station B is $33.

Innovation Statement

ORTEC’s Cost to Serve solution is advanced analytics software that uses machine learning to identify delivery cost per customer for all supply chain industries. The solution is a state-of-the-art commercial product to identify cost allocation, while taking into account dozens of customer attributes and extensive historical route data.

Applicability

For each logistics provider with a dedicated fleet, the solution gives accurate insight into the cost per customer and the profitability can be right sized.

 

Posted Date 12/19/19
Contact Eric Lucey
Contact Email
Category Best IT Innovation

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