February 8, 2016 - Chainalytics

Confidential | © 2016 Chainalytics Inc.

PRESENTED BY:

February 8, 2016


TODAY’S SPEAKERS

2

Andrew Koval

Manager, Truckload Services

Chris Ricciardi

Co-founder and Chief Product Officer

Matt Harding

Vice President, FMIC


AGENDA

3

The Current State of Pricing

Benefits of Rating Tools

LoadDex Insights

Market Rate and Capacity Update

Freight Market Intelligence Introduction

Pricing Problems

How CHAINalytics and LoadDex helped provide solutions


AGENDA

4



LoadDex Insights



Pricing Problems



WHO IS CHAINALYTICS?

5

11 YEARS

GREAT SUPPLY CHAIN PARTNER SupplyChainBrain

18 TOP 25

supply chains of Gartner’s

8 RETAIL TOP 10

7 FOOD & BEVERAGE TOP 10

6 CPG TOP 10

91 of the

FORTUNE 500

TOP SUPPLY CHAIN SCHOOL

67 %

WITH DEGREE FROM consultants

of

* 27 BILLION

$

FMIC

FREIGHT SPEND CAPTURED IN

25 %

CAGR since 2009

COOL VENDOR in supply chain services

Gartner 2013 13 PROS

Supply & Demand Chain Executive

TO KNOW

AMSTERDAM ATLANTA BANGALORE MILAN MINNEAPOLIS HELSINKI SINGAPORE STOCKHOLM SYDNEY 9 offices

GLOBAL


OUR COMPE TENCIES

6

Supply Chain Design

Integrated Demand & Supply

Planning

Sourcing & Supplier

Management

Packaging Optimization

Supply Chain Operations

Transportation Service Supply Chain

Applying fact-based transformation approaches using top supply chain talent.


SPOT POLL

What is your current expectation for dry van carrier capacity?

Easily Available

Somewhat Available

In Balance

Somewhat Tight

Very Tight

CHAINalytics powered by

7


THE QUALITATIVE: WHAT PEOPLE THINK CHAINALYTICS: QUARTERLY RATE AND CAPACITY SURVEYS

8

PERCENT OF RESPONSES: CURRENT CAPACITY OUTLOOK BY QUARTER PERCENT OF RESPONSES: 6-MONTH RATE OUTLOOK BY QUARTER


THE QUANTITATIVE: THE DATA FREIGHT DEMAND INDEX: DRY VAN RESULTS

9

GREEN Indicates weakening pricing

pressure in market due to

lower

spot market rates

for truckload capacity

Red Indicates greater pricing

pressure in market due to

increased

spot market rates

for truckload capacity

Confidential | © 2016 Chainalytics Inc. 10

The abundance of transportation data across markets combined with Chainalytics’ analytical capabilities is transforming how LLPs/Brokers

respond to these challenges

3PLS & BROKERAGES UNIQUE PRICING CHALLENGES CENTRAL TO LONG-TERM CUSTOMER RELATIONSHIPS

3PL Lead Logistics Providers (LLPs) Brokers

Maximize service and minimize spot rates by developing a reliable carrier base

Customers expect transparency, solid procurement processes and flawless execution

Ensure high levels of readiness

Strategies range from selective load acceptance to comprehensive account management

Always drive cost from the network

Capacity ebbs year to year leaving outdated routing ongoing

New lanes enter route guide sub-optimally, old lanes exit

Always drive profit

Buy low – sell high

Manage and develop trust ensuring long-term relationships

Strong understanding of transportation markets – rates and capacity-trajectory


OUR MISSION

11

Elevate the impact of transportation for Lead-Logistics Providers and Brokerages with enhanced market-focused competency

Maximize utility of information

impacting material gains

Transform Communicate

Provide necessary information to

inform customers and providers of market dynamics

Minimize time-to-insight with ground-breaking tools and

visualization technology

Accelerate

Maximize the proliferation of data

driven insights within internal IT

systems to support procurement and pricing functions

Integrate


FREIGHT MARKET INTELLIGENCE CONSORTIUM

12

2004 2016

+140 MEMBERS

$27B FREIGHT DATA

8 OFFERINGS

7 MEMBERS

$0.7B FREIGHT DATA

1 OFFERING

NORTH AMERICA ALL MAJOR MODES

- SHIPPER LTL, TL

- 3PL/BROKER TL

- OCEAN

BRAZIL & EUROPE - SHIPPER TL

FMIC GLOBAL GEOGRAPHIES


FREIGHT MARKET INTELLIGENCE DEFINED ECONOMETRIC MODELING

13

https://www.youtube.com/watch?v=mIx2Oj5y9Q8

https://www.youtube.com/watch?v=mIx2Oj5y9Q8


MODEL OUTPUT: ATLANTA OUTBOUND MARKETS RATE PER MILE, >250 MILES, DRY VAN

14

1 DAY

2 DAY

3 DAY

4 DAY

5 DAY


RATE PER MILE: ATLANTA TO CONTINENTAL 48 1-6 DAY TRANSIT TIMES

15



16



17



18



19



20


SUPPORTED OUTBOUND US MARKETS

21

Markets updated monthly

Trailing 12-Months (Contract)

Trailing 3-Months (Market)


LAUNCHING NOWCAST IN FEBRUARY

22

Markets updated monthly

Trailing 12-Months (Contract)

Trailing 3-Months (Market)

Spot : Atlanta - Orlando Contract : Atlanta - Orlando

Confidential | © 2016 Chainalytics Inc. 23

SUMMARY – WINNERS AND THE “BIG PICTURE”

No question that the world is in significant transformation – IoT, Sharing Economy, AI, Cloud all leading to a data “explosion” Data is merely a noun…we all consume, but the goal is to win…so what do winners do in this emerging environment? Winners use data to triangulate – in ALL business cycles

- Familiarity with many sources of market intelligence - Keen awareness of strengths and weaknesses of various options - Master balance between Judgement (gut) and Data (facts) - Build efficient, repeatable, scalable processes enabling staff to

execute, collaborate and win

How do 3rd Party Providers thrive in this emerging world when the amount of information seems unmanageable?


AGENDA

24



LoadDex Insights



Pricing Problems


We are a Chicago-based technology company focused on the logistics and

transportation space. We want to take the complexity out of shipping and

open up new possibilities across the supply chain.

Our pricing platform, LoadDex, aggregates historical, social, and external data

and empowers users to make strategic decisions about pricing and mode

selection.

25 WHAT IS LOGISTICAL LABS? COMPANY OVERVIEW

OUR CUSTOMERS:

• Transport Topics’ Top 50 Logistics Companies

• Transport Topics' Top 25 Dedicated Contract Carriers

• Inc. 5000 Companies

SHIPPING IS

CONFUSING

Which MODE is best?

Which CARRIER is best?

Is my COST too high?

Is there a FASTER way to move this?

27 THE PROBLEM WITH PRICING

28 PRICING NEEDS A PROCESS

• Companies feel ‘growth pains’

since there is a long ramp-up time

for reps to become educated and

profitable.

• Information silos across the

organization make it difficult to

spread the wealth of knowledge in

a uniform manor.

• Putting the best systems in place

will drive operational efficiencies

and allow companies to scale.

29 BENEFITS OF RATING TOOLS

INCREASED RATING

INTELLIGENCE

IMPROVED STAFF

EFFICIENCY

OPERATIONAL

LEVERAGE RESULTING

IN MORE PROFITABLE

SHIPMENTS

30 IMPROVED QUOTING PROCESS

31 IMPROVED QUOTING PROCESS

• Create consistencies while quoting

the same customer/lane

• Get sales reps to think like analysts

instead of only relying on gut instinct

• Run bids much faster than before

• Track win/loss quote information to

increase their customer conversion

ratio or stop quoting customers that

rate shop

There’s so much data out there that without a process, people get lost and

info gets interpreted incorrectly. By putting a solid process in place we’ve

seen companies:

• Break down information silos and

broadcast knowledge to entire

organization

• Reduce spot quote research from 10

minutes to 10 seconds, allowing more

for more opportunities in less time

• Provide a process that allows staff to

win while giving execs the tools to

manage it

32

LOADDEX INSIGHTS HOURLY ACTIVITY LEVEL

33

LOADDEX INSIGHTS FLOODED MARKETS

34

LOADDEX INSIGHTS ASSET UTILIZATION

SUMMARY

Pricing is confusing; current methods

are fragmented.

Pricing needs a process. Aggregating

all data into a centralized system

allows for optimal execution.

When combining the right data with

the right tools, how do 3PLs actually

manage the process?


AGENDA

36



LoadDex Insights

Trends Driving Demand for FMIC & Our Mission

Freight Market Intelligence: Trends & Visualization

Pricing Problems


LPS’s Background

• Incorporated in 1987

• Privately Held, WBE & DBE Certified

• Original offering was automated transportation pricing

• Headquarters in Saint Paul, MN

• Regional Branch Offices: Minneapolis, Kansas City, Houston, Tulsa, Tallahassee, Los Angeles, Antwerp Belgium

• $250+ Million Global Customer Freight Spend

37

Services That LPS Provides

• 4 PL

• 3 PL

• SaaS

• Freight Payment and Audit

• Project Logistics

• Customized Software Solutions

• Consulting

LPS Growth

41% Employee Growth Since 2014

2014 Ernst & Young finalist for Entrepreneur of Year

A MN Fastest growing company. 2013/2014 & 2015

In 2012, LPS acquired a new 24,000 sq. ft. headquarters in Woodbury, Minnesota

The Beginning of LPS’ 3PL Offering

• LPS’ 3PL offering started in 2011

• No dedicated 3PL system

• Had to be “creative” for management of transactions, customers, and carriers

• Very little process in place

Classic Pricing Problems

• Different rates quoted to the same customer

• Different pricing sources and methods

• Viewing load history was difficult

• Quotes saved on individuals email

• Difficult quote retrieval process

• RFP’s were cumbersome

LPS & CHAINalytics

• Started utilizing CHAINalytics in 2011

• Benefits that were provided:

– Provides “clean data”

– A source of “truth”

– RFP solution

– Reporting

LPS & LoadDex

• Started to utilize LoadDex in 2013

• Benefits that LoadDex provided:

– Provided one platform to view all rate information

– Visual representation for trends

– Consistent pricing

– Ability to customize

– Avoided the time, cost, and maintenance to build in-house option

Capabilities Today

• LoadDex is the only source for rates

• Quoting process is streamlined

• LPS now has the ability to easily enter quotes and retrieve quotes

– Configuration of quotes based on historical information

• Ability to see all rating sources

– Integration with CHAINalytics

– Poll the Group

• Clean LPS history

• RFP turnaround time dramatically improved

THANK YOU

ANDREW KOVAL

Manager, Truckload Services

[email protected]

+1(651) 789-4986

Q&A

CHRIS RICCIARDI

Co-founder and Chief Product Officer

[email protected]

+1(312) 662-4773

MATT HARDING

Vice President, FMIC

[email protected]

+1(603) 347-1250

http://www.chainalytics.com/

mailto:[email protected]?subject=FMIC%20Loadex%20Integration%20for%203PLs%20-%20From%20Chaos%20to%20Consistency



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February 8, 2016 - Chainalytics