How Cabinetworks managed freight spend to median lane prices or below within a year: “Benchmarking ocean freight with Freightos Data allows us to make targeted negotiating decisions while continuously knowing where we are against the freight market.”
As the largest privately held cabinetmaker in the United States, Cabinetworks Group is home to 16 brands, including industry leaders KraftMaid®, Medallion® and Merillat®. Through an expansive network of major home centers, independent dealers, distributors and multi-family home builders, Cabinetworks builds life into the kitchen — meeting any customer’s vision with the industry’s most comprehensive choice.
Day in and day out, Cabinetworks delivers high-quality, beautiful cabinetry to their customers, helping the dream of a new kitchen become a reality. With facilities across the U.S., centralized logistics management keeps the complex supply chain moving. The logistics team plays a pivotal role in moving products from raw materials to factories to sales points to customers’ homes.
During the pandemic-fueled supply chain crisis, material shortages and extended delays drove increased demand for logistics. Raw materials and logistics costs rose significantly and, more importantly, for a consumer brand, customer lead times ballooned by a multiple of four to five times. When the market moves rapidly and often, how do supply chain organizations ensure competitive pricing without slowing down operations?
This question used to keep Tony Heldreth, Chief Procurement & Supply Chain Officer at Cabinetworks Group, and his team awake at night.As freight markets heated up, effective price negotiations and logistics market performance were top of mind for the supply chain team as well as company executives, with both asking the same question – how do we accurately measure performance versus the market, as opposed to explaining performance to ‘plan’? How do we really know “where we are?”
“Our inability to access real-time market pricing was a significant pain point,” says Tony. “The gap in information and lack of transparency in pricing hindered our ability to manage costs, forecast accurately, and negotiate pricing, making it extremely difficult to keep our internal executive leaders up to speed on what was happening in our lanes and markets.”
Tony looked for a benchmark that could give the organization a clear picture of where freight pricing performance needed to be. The solution needed to be high-quality data, reliable and actionable with a high reporting frequency, and easily presentable to the executive team.
Enter Freighos Data.
Freightos Data provides Tony and his team with daily transaction-based port-to-port benchmark pricing and contextual market-moving event updates. The data is clear and concise and gives Tony and the entire organization a 360-degree view of their markets. The data quality provides Cabinetworks with an edge that pays off at the bottom line:
“With Freightos Data we now know how our rates compare to market port -to- port rates, and this steers our lane-by-lane negotiations. We’ve seen significant savings in our negotiations since utilizing Freightos Data.”
The volatility-driven logistics market has faded into the rearview mirror in 2023, with current market levels back to pre-pandemic lows. However, Tony and the Cabinetworks international procurement and operations teams utilize Freightos Data more than ever to benchmark performance, provide internal reporting, and drive continuous optimization and savings on logistics negotiations.
“We use Freightos Data weekly to assess our performance in our lanes in the market…it doesn’t matter if it’s a $2,000 container or a $15,000 container. Knowing where we are continuously against the market is critical – because knowing where we are, advantaged or disadvantaged, allows us to make targeted negotiating decisions.”
Besides ensuring careful and accurate freight rate negotiations, access to robust market-generated pricing data enables the team to discover new and better trend signals to follow. “For example,” says Tony, “we’ve recently started looking at quarterly trend lines of our key lanes comparing market median to actual price. This helps us understand the market trajectory as well as our performance.”
Bottom line? “Freightos Data helps me and my team monitor market conditions and performance easily and clearly. I thoroughly recommend utilizing Freightos Data for benchmarking and market intelligence – it’s helped us optimize logistics market performance.”
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With Freightos Data we now know how our rates compare to market port to port rates, and this steers our lane-by-lane negotiations. We’ve seen significant savings in our negotiations since utilizing Freightos Data. Knowing where we are continuously against the market is critical.
