In reviewing the current delivery process, I immediately noticed that Spartan seems to have the same ship methods for every customer. While it may be easier for the transportation department to have a single shipping process, it is not necessarily the best move for our business. Spartan is shipping both local and rural orders via highway transport. Given the number of customers who often ask us to ship to multiple locations and the sheer number of orders in a given month, that equates to a lot of trucks on the road at any time. The company is wasting money on less than truckload (LTL) shipments in addition to shipping all orders by way of highway transport.
Paul Saxton mentioned that “right now we give too much flexibility to our sales people, who like to get on the phone and play “dial-a-deal” (page 4). The difficulty is that the sales staff gets evaluated on the basis of product gross margins, which ignores the costs of handling, storage and transportation.” Spartan is not the first company to be faced with logistical challenges while trying to meet the demands of the sales team, nor will they be the last. The difficult part is convincing the sales team that not every sale is going to be beneficial to the company's bottom line. People often do not look at the cost of running a supply chain in from beginning to end; especially those in other departments who may not fully understand how a supply chain operates. That is why it is important for us to offer solutions that people in other departments may not be aware of.
Paul Saxton mentioned that “right now we give too much flexibility to our sales people, who like to get on the phone and play “dial-a-deal” (page 4). The difficulty is that the sales staff gets evaluated on the basis of product gross margins, which ignores the costs of handling, storage and transportation.” Spartan is not the first company to be faced with logistical challenges while trying to meet the demands of the sales team, nor will they be the last. The difficult part is convincing the sales team that not every sale is going to be beneficial to the company's bottom line. People often do not look at the cost of running a supply chain in from beginning to end; especially those in other departments who may not fully understand how a supply chain operates. That is why it is important for us to offer solutions that people in other departments may not be aware of.