A freight network that was designed for the business as it was three years ago may not be the right network for the business as it is today. Customer locations shift as the customer base grows or changes. Supplier relationships evolve, adding or removing origin points that were not in the original network design. Volume distributions between lanes change as product mix and customer demand patterns develop. And the carrier market evolves, making some network configurations more commercially attractive and others less so than they were when the current network was established. A freight network design review identifies the gap between the network that is currently operating and the network that would best serve the current business – and quantifies the cost of that gap in terms of freight spend, service quality, or both. RoadFreightCompany conducts network design reviews for clients at regular intervals because the savings identified are consistently larger than the cost of the review.
What a Network Design Review Actually Examines
A freight network design review is not a rate benchmarking exercise or a carrier performance assessment – those are inputs to the review, not the review itself. It is an examination of whether the structure of the freight network – the lanes used, the transport modes selected, the consolidation points employed, and the warehouse locations serving as origins and destinations – is optimally matched to the current freight flows and service requirements of the business.
The specific questions a network design review addresses include: are there lanes currently served by dedicated transport where consolidated services would meet the service requirement at lower cost? Are there lanes currently served by consolidated services where the volume has grown to the point where a dedicated service would be faster and cheaper? Are there warehouse or consolidation points in the network whose location is no longer optimal for the current customer and supplier base? Are there transport modes being used for specific lane types where an alternative mode would provide better cost or service performance? And are there carrier relationships whose scope has not kept pace with the evolution of the freight network, creating gaps or overlaps that a more deliberate carrier portfolio design would eliminate? The network analysis that the commercial team at RoadFreightCompany builds for clients entering a review covers all of these questions with specific data from the client’s own freight history – because the answers are in the operational data rather than in general market assessments.
When Network Design Reviews Are Most Valuable
Freight network design reviews deliver the most value at specific inflection points in a business’s development – the moments when the network is most likely to have drifted from optimal alignment with current requirements:
- After significant commercial growth – when the customer base has expanded materially, changing the geographic distribution of delivery demand in ways the original network was not designed to serve
- After acquisitions or mergers – when two previously separate freight networks are being operated alongside each other rather than being rationalised into a coherent combined network
- After major supplier changes – when new supplier locations have been added or existing ones removed, changing the inbound freight origin structure in ways that may make the current warehouse and consolidation point locations sub-optimal
- After significant market entry or exit – when new geographic markets have been entered or old ones exited, changing the demand pattern in ways that affect the optimal lane and carrier portfolio structure
- On a regular scheduled basis – for operations with stable but evolving freight profiles, a review every two to three years catches the gradual drift from optimal alignment that accumulates between major structural changes
The review is most valuable when conducted proactively – at a scheduled interval or at a known inflection point – rather than reactively in response to a specific problem. A reactive review identifies the cause of a known issue. A proactive review identifies issues that have not yet become problems and opportunities that would not be visible without the analytical view the review provides.
What Network Design Reviews Typically Find
The findings of freight network design reviews are consistent enough across different operations to be worth describing in general terms. Consolidated services are almost always underutilised on lanes where the volume has grown to the point where dedicated services would be cheaper per unit. Warehouse and consolidation point locations are typically two to three years behind the optimal location for the current customer geography. And carrier portfolios routinely contain gaps – lanes without a primary contracted carrier – and overlaps – multiple carriers competing on the same lanes without a deliberate allocation structure – that a more deliberate design would rationalise.
The quantified savings from addressing these findings vary by operation but are consistently material. Cost reductions of five to fifteen percent of total freight spend are achievable in most operations that have not had a network design review in the previous three years – not through rate negotiation but through structural improvements to how the network is configured. Those savings are durable because they are structural rather than commercial – they do not reverse when the carrier market changes or when a rate agreement expires.
A freight network design review is one of the highest-return analytical investments available in logistics management. The cost is a structured analysis exercise. The return is a more efficient network that produces lower freight spend and better service quality on a permanent basis. For operations that have not conducted a review recently, the analysis of what the current network is costing relative to what a better-designed network would cost is almost always a compelling finding. That finding is what RoadFreightCompany produces for clients entering a network design review – and it is the finding that most consistently drives the decision to implement the network improvements the review identifies.
Freight networks drift from optimal alignment gradually, as the business they serve evolves and the network does not. The drift is invisible in day-to-day operations but visible in a network design review – and the cost it represents is recoverable through structural changes that do not require carrier concessions or market conditions to change.
The operations that conduct regular network design reviews are those whose freight spend is most consistently aligned with the actual cost-efficient structure for their current business – rather than the structure that made sense three years ago.
For logistics operations whose freight network has not been reviewed recently against the questions described above, the review is the right starting point. RoadFreightCompany is ready to conduct it – with the analytical capability and the network knowledge to produce findings that are specific, quantified, and actionable.
A freight network that was right for the business three years ago is probably not right for the business today. The gap between those two networks is the cost that a network design review identifies and a network optimisation programme recovers.
The recovery is available to any operation willing to look at the current network honestly against the current business requirements – and the savings it produces are among the most durable available in freight cost management.
That analysis is what Road Freight Company brings to every network design review it conducts – and the savings it identifies are the reason the review is consistently worth doing.