Case Study
Signed, Sealed, & Delivered: Reducing Delivery Costs by $100 Million
When a federal agency needed help in reducing delivery fees, Censeo was brought on, and ended up saving the government $100 million over the lifetime of the program. The solution ultimately reduced costs, improved service levels, and helped agencies make smarter shipping decisions.
Situation
Prior to launching a government-wide delivery services management program, the federal government did not leverage its purchasing volume, and had minimal insight into its shipping patterns. As a result, the government was overpaying for services it bought, and in many cases was not buying the right service for their needs. Censeo’s client agency was charged with running the program and lowering the Total Cost of Ownership through the evaluation and restructuring of services.
Approach
Censeo supported the client through three generations of its government-wide delivery services program, building on previous successes each time. Through Censeo’s Strategic Sourcing process, the team helped GSA understand the complex dynamics of the delivery services market. Censeo then supported the development of strategies to lower costs, improve vendor performance, and empower users make more informed decisions.
Results
Each generation of the program resulted in incremental cost savings and other service improvements. The first generation solution resulted in an initial 30 percent cost reduction, and the government began collecting detailed shipping data for the first time. The second generation solution reduced delivery prices a further 7 percent, and helped agencies make smarter shipping decisions, further lowering service costs by 20 percent. The latest solution brought all $200 million in delivery services spend under management, increasing the government’s ability to manage vendor performance. The latest solution also reduced prices by another 3 percent, and reduced improper payments through rigorous invoice auditing.
Throughout their time supporting the agency, Censeo also developed a business model that enables the program to provide efficient and high-quality customer service, resulting in some of the highest customer satisfaction scores within the agency.
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