Hodell-Natco Case Study

At first, I was blown away by the data and excited, then I started getting disgusted at seeing the things we were doing to that were costing us money … Now that we see the data so easily, we have an advantage and an opportunity.  We identified a way to use the data that can save us over $60,000 in supplier costs.    – Dan R. – Purchasing Director

Hodell-Natco Industries is a full-service wholesale distributor of fasteners and chain. Stocking over 40,000 industrial fastener and chain items, they provide customers with expertise in sourcing hard-to-find items. Hodell-Natco spends over $650K annually on parcel, 82.6% ground with 12.8% Next Day shipments. Two-thirds of the spend is on inbound or third-party shipments, as a large amount of the outbound shipping is shipped collect.

In 2018, Hodell-Natco was gathering data into Parcel BI to negotiate a new contract. Parcel BI’s Contract Edge helped highlight some important contract negation points between both UPS and FedEx. One thing that was exposed that one of their DC’s gets hit with a delivery area surcharge on all shipments, so that was addressed along with rates, incentives and waivers.

They are executing a new contract that will save of over $75,000 annually.

Additionally, Hodell-Natco was made aware of the impact vendor shipping practices is having on their profitability. Parcel BI exposed over $10,000 in declared value charges and they are now adjusting and communicating policy improvements to suppliers. Additionally, they have exposed bad practices and bad data that was costing them over $1,000 in invalid account fees and $2,300 in avoidable address correction charges.

Parcel BI also empowered Hodell-Natco to identify suppliers that were shipping collect and see what that was costing them. Negotiating price reductions from suppliers is challenging, but they realized that they can instead ask for free shipping. The suppliers are more agreeable to give free shipping than price concessions, but it is a bigger savings for Hodell-Natco to get free shipping. Without Parcel BI features sender/receiver grouping, it would be impossible to quantify.

Upon realizing the savings thus far, Hodell-Natco will be taking advantage of Parcel BI’s Refund Audit and recapturing funds otherwise lost, and that alone will provide ROI on Parcel BI, further justifying the value of product.

 

Customer: Hodell-Natco Industries

Industry: Industrial Distribution

About:  A full service distributor of hard to find fasteners and chain.

 www.Hodell-Natco.com

 

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