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2009 Quest for Quality Awards: FREIGHT FORWARDERS: Best foreign performance

By Logistics Management Staff -- Logistics Management, 8/1/2009

Although many shippers are still finding that far-shore operations can still equate to a high-quality, low-budget production, some of the savviest logistics and supply chain professionals are quickly turning to a strategy we’re calling “right-shoring.” As we defined it in the pages of Logistics Management earlier this year, right-shoring is the combination of on-shore, near-shore, and far-shore operations into a single, flexible, low-cost, and service-centric approach to supply chain and logistics management.

While the authors of our feature “Right-shoring: A flexible strategy for tough times” were not implying that far-shoring is no longer a viable strategy, they were attempting to stress the fact that “worldwide economic problems and changes have drastically altered the cost dynamics associated with manufacturing and distribution network strategies.” So much so, our authors found, that many shippers no longer assume that far-shore operations are less expensive in the long term.

And as we continue to follow the strategic moves top global shippers are making, we’re finding that companies that are over-invested in far-shore operations tend to be the supply chain operations that are most at risk, as crude oil prices fluctuate wildly, labor costs rise in developing countries, and the value of the U.S. dollar shifts unpredictably.

But no matter how difficult the global supply chain landscape may become, there is one thing for certain: Global shippers will continue to rely on the best connected freight forwarders to move goods through expanding—or contracting—distribution networks. Indeed, this savvy group of freight forwarders has seen their business flourish over the past decade, and now the very top service providers are poised to catch the next phase of growth.

In 2009, global shippers have voted in 14 freight forwarders, three more than we invited to walk down the red carpet in 2008. And as we’ve found in a number of other categories this year, shippers are telling us that this group of winning providers has kicked their performance up a notch. In fact, the overall weighted average for this group ticked up 1.27 points over 2008’s number, signaling an improved overall level of service satisfaction.

As in the other categories that saw the overall weighted average climb this year, there were a couple of the individual attribute categories that helped push the number up. Freight Forwarder executives should be proud to note that four of the five attribute categories saw slight improvements, including On-time Performance, Value, Customer Service, and Equipment & Operations.

Pilot Fright Services (37.51) and UPS SonicAir (37.31) led the pack of winners this year in a race that was nearly too close to call for the overall top position. In the individual attribute categories, UPS posted the top score in On-time Performance (12.63) and Information Technology (5.38), Lynden Air Freight took top honors in Value (8.55), and Pilot Freight Services posted the high mark in Customer Service with a 7.91.

On-time Performance Value Information Technology Customer Service Equipment & Operations Weighted Score
All scores are weighted. Weighted scores are determined by multiplying the average raw scores by the average importance of each attribute (1= least important; 5= most important). To find the attributed weights for this category, see the introduction to the Quest for Quality report.
Logistics Management - 2009 Quest for Quality - Freight Forwarders - Reed Business Information - June 2009
Pilot Freight Services 12.37 8.46 4.92 7.91 3.85 37.51
UPS SonicAir 12.63 7.65 5.38 7.65 4.00 37.31
Lynden Air Freight 11.46 8.55 4.86 7.75 3.70 36.31
Nippon Express USA 12.32 7.97 4.82 7.53 3.61 36.25
Hellmann Worldwide 10.97 8.28 4.83 7.68 3.81 35.56
FedEx Trade Networks 11.18 8.02 5.29 7.02 3.91 35.41
Expeditors International Express 11.34 8.18 4.91 7.25 3.65 35.33
Exel 11.25 8.00 4.73 7.16 3.59 34.72
SEKO 11.32 7.69 4.39 7.68 3.42 34.50
CEVA Logistics 11.20 8.05 4.56 7.03 3.64 34.48
Kintetsu World Express 11.39 8.03 4.44 6.92 3.58 34.36
UTi Worldwide 11.03 7.75 4.68 7.07 3.55 34.08
DAX Dependable AirCargo Express 11.57 7.75 4.35 6.64 3.69 34.01
Kuehne + Nagel 11.15 7.57 4.68 6.84 3.67 33.90
AVERAGE 10.87 7.82 4.56 6.95 3.58 33.78
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