Our transportation costs are rising, but we don't know why or what needs to be fixed.

Transportation costs rarely increase because of one single decision.

A carrier raises its rates. Fuel costs rise. A delivery network expands. Customer expectations become more demanding.

In most organisations, the bigger problem isn’t that transportation has become more expensive. It’s that management can’t clearly see what is driving the increase or where to act first.

The transportation team knows freight spend is higher than last year. Finance knows the transportation budget is under pressure. Procurement is negotiating harder with carriers. Planners are working harder than ever.

And the overall picture is still unclear:

Which lanes are becoming expensive?

• Are vehicles being used efficiently?
• How much are empty miles costing the business?
• Are planners making unnecessary changes because the planning process isn’t responsive enough?
• Are premium freight costs rising because transportation decisions are being made too late?
• Are carrier choices being driven by the right commercial and operational factors?

And, most importantly, can the organisation connect these operational decisions to actual transportation spend?

This is where SCM Champs work with companies, moving the conversation from “transportation costs are too high” to “we know exactly what is driving the cost, and we know what needs to change.”

The Problem Is Bigger Than Freight Rates 

When transportation costs increase, the immediate reaction is often to look at carrier rates. But reducing transportation costs is rarely as simple as negotiating a lower one.

A lower rate on an inefficient transportation plan can still produce a higher total cost. A company may negotiate better carrier rates and keep sending vehicles out with low utilisation; the rate looks better, but the spend doesn’t. Another may hold a strong carrier contract and still lean on premium transportation because deliveries are planned too late; the rate isn’t the real problem – how transportation is planned, executed, changed and controlled is.

That’s why we don’t treat transportation cost improvement as a standalone procurement exercise. This is also where experienced SAP TM consulting firms can help connect technology decisions with actual transportation outcomes. 

SCM Champs start by finding where the cost is actually coming from

One of the first challenges we address is visibility.

Management typically receives a transportation cost number. What they need is a transportation cost explanation. Knowing that spend increased 12% doesn’t tell a supply chain leader what to do about it.

Questions that need answers:

Is the increase coming from higher freight rates or from higher volume?

• Is the company using more expensive carriers than it needs to?
• Are routes longer than they need to be?
• Are vehicles leaving with unused capacity?
• Are shipments being split unnecessarily?
• Are late decisions creating premium freight?
• Are delivery changes triggering additional transportation movements?
• Are planners repeatedly replanning because the original plan wasn’t practical?
• Are execution exceptions creating additional cost?

Answering these requires more than a finance report — it requires visibility into the transportation planning and execution process. 

This is where our work with SAP Transportation Management (SAP TM) becomes important: we connect the operational side of transportation with the commercial side, so cost drivers become identifiable. A structured SAP Transportation cost analysis helps organisations move beyond a single freight-spend figure and understand the operational conditions behind it. 

Instead of one large spend number, the business gets the operational factors actually driving it, and a far more actionable conversation.

We focus on other aspects than visibility 

Visibility alone doesn’t reduce transportation cost.

• A dashboard can show that vehicle utilisation is low — it doesn’t improve utilisation.
• A report can show a lane has a high cost — it doesn’t fix the lane.
• A system can flag excessive mileage — it doesn’t produce a better plan.

Our objective isn’t to give management more information. It’s to make that information actionable.

That means we look at:

SAP TM configuration

• Transportation planning logic
• Constraints and master data
• Carrier strategy
• Routing approach
• Integration points

This is why companies often look beyond traditional Transportation cost optimisation firms when they need improvements that connect planning, configuration and execution rather than focusing only on cost reporting. 

We Examine the Transportation Planning Logic 

Transportation planning involves competing objectives:

The business wants lower freight costs

• Operations wants reliable delivery
• Customer service wants their commitments protected
• Warehouse teams want practical loading and dispatch schedules
• Procurement wants transportation to stay within negotiated carrier agreements. 
• Finance wants the spend under control

A plan that optimises for only one of these will create problems elsewhere:

Transportation optimisation has to reflect the business’s actual priorities, not the most technically elegant model. 

Our role is to help companies translate those priorities into a transportation planning model that SAP TM can actually work with, reviewing the constraints, cost settings, planning parameters, resources, routes and delivery requirements that feed it.

SCM Champs Help Companies Address Low Vehicle Utilisation 

Vehicle utilisation is one of the simplest transportation metrics to understand and one of the easiest places for hidden costs to accumulate. A truck moving with significant unused capacity still generates a full transportation cost.

The scale of this problem, industry-wide, is not small. In our experience, deadhead (empty) mileage can account for nearly one in every six miles driven, while average trucking operating costs can reach $2.336 per mile. While still consuming fuel, driver time, and equipment life. 

Whether that capacity sits in a private fleet or gets priced into carrier rates, it still has to be accounted for. And when the same inefficiency turns up again and again — across the same lanes, regions, or customer groups — it's the transportation network's overall utilisation that takes the hit. Fixing that isn't as simple as telling planners to load more onto each vehicle. 

The system has to weigh:

• Shipment compatibility
• Capacity
• Delivery windows
• Routes
• Resource availability
• Operational constraints

We assess whether the transportation planning process is actually capturing available consolidation and capacity opportunities, and where it isn’t, we work on the planning configuration and business rules needed to close the gap, without compromising the requirements that matter. The goal is straightforward: move more of the right freight, with the right transportation resource, at the right cost.

We Help Reduce Unnecessary Mileage and Empty Movement 

Mileage is another area where cost grows quietly. A route can look operationally acceptable while still creating unnecessary travel.

Common causes:

Poor sequencing

• Disconnected shipment planning
• Inefficient backhauls
• Weak consolidation
• Transportation decisions made independently rather than across the network

One inefficient movement on its own rarely looks significant. Thousands of similar movements do — which is especially true for organisations running complex transportation networks. 

That’s why our approach examines how the network is being planned rather than reviewing individual trips in isolation, assessing whether SAP TM is considering the relevant relationships, routes, resources, capacities and constraints across the whole network. 

The goal is a planning environment where unnecessary movement gets identified and reduced systematically, turning cost optimisation from a manual planner exercise into a repeatable business process.

We Help Identify the Cost of Poor Planning Decisions

Not every transportation cost problem comes from a bad route. Sometimes it comes from a late decision.

What a late decision typically triggers:

Carrier availability becomes limited

• Delivery options shrink
• Consolidation opportunities disappear
• The business has to use a more expensive mode
• A shipment needs expedited movement
• A planner has to build a last-minute workaround

By the time the freight reaches the customer, the delivery commitment may be met at a much higher cost. This is why transportation cost management can’t be separated from planning discipline. 

We help organisations identify where these late decisions are occurring and how SAP TM can support earlier, more structured planning, reducing the situations where the business is effectively paying extra because the transportation decision was made too late.

We Review Carrier Selection and Transportation Strategy 

Carrier selection has a direct impact on cost — but the lowest rate isn’t always the lowest total cost.

A carrier with a competitive rate may have limited availability.

• A carrier with a higher nominal rate may offer better coverage or reliability.
• A carrier may be the right fit only for certain lanes or shipment types.

The challenge is making these calls consistently, rather than relying on individual planner judgement. 

We help organisations review how carriers and transportation resources are represented and used within their SAP TM processes to establish a more controlled, repeatable approach to carrier selection — one that reflects the commercial and operational requirements of the business. 

This is especially valuable for organisations running multiple carriers, regions, transportation modes or operating entities, where consistency is what improves both control and scalability.

We Address the Master Data Behind the Cost Problem 

Sometimes transportation planning looks like the problem when the real issue is the data feeding it. We regularly find:

Incorrect locations

• Outdated transportation lanes
• Incorrect resource capacities
• Missing calendars
• Incorrect transportation sones
• Incomplete carrier information
• Incorrect lead times
• Poorly maintained rates

Small data problems produce poor transportation decisions — and repeated across hundreds or thousands of shipments, they become a financial problem. 

This is why SCM Champs’ assessment doesn’t stop at process design. We look at the master data and configuration SAP TM depends on to confirm the planning engine is working from information that actually represents the operating environment. A transportation optimisation model can only be as good as the information and business rules behind it.

We Connect Transportation Planning With the Broader SAP Landscape 

Transportation doesn’t operate in isolation:

Orders originate in enterprise processes.

• Deliveries depend on warehouse and inventory activity.
• Transportation planning depends on accurate logistics data.
• Execution creates events that can require transportation changes.
• Freight settlement eventually hits the financial side of the business.

When these processes are poorly connected, transportation teams compensate with spreadsheets, manual checks, emails, and repeated system updates — which creates more than administrative work:

A plan built on outdated or incomplete information leads to unnecessary movement.

• A delayed update misses a consolidation opportunity.
• A disconnected execution process results in expensive corrective transportation.

SCM Champs’ role includes examining these integration points and identifying where the SAP landscape is preventing transportation teams from making timely, informed decisions.

We Turn Transportation Data Into Management Decisions

For senior management, transportation data needs to answer the business questions, not system questions:

Why is transportation spends are increasing?

• Which areas are responsible for the increase?
• Which transportation decisions are creating unnecessary costs?
• Where are we paying for low utilisation?
• Where are we using premium transportation?
• Which lanes require intervention?
• Which carriers are creating commercial or operational issues?
• What should we fix first?

This is the SAP TM environment and reporting approach SCM Champs helps build, so transportation leaders can answer these questions with confidence — moving from retrospective reporting toward operational control. 

Instead of discovering at month-end that transportation spend increased, the organisation should be able to see the operational conditions contributing to it and act earlier.

We Help Prioritise the Fix 

Not every transport problem is worth the same attention. Trying to do everything at once can stretch the resources and make it harder to manage the problem.

The biggest opportunities tend to follow a few clear patterns. For example, a small number of high volume lanes may be responsible for a disproportionate share of excess freight costs.

• Poor vehicle utilisation turns out to be the primary issue.
• Premium freight is climbing because planning decisions are made too late.
• Inefficient routing is affecting a large part of the network.

The right fix is driven by the underlying cost structure of the business.

We help identify the highest-value opportunities and focus SAP TM improvements where they produce the most meaningful operational and financial impact.

The Goal Is Better Control, Not Just Lower Cost 

Cost reduction shouldn’t come at the expense of the operation. A strategy that cuts costs but creates late deliveries isn’t a successful strategy. Neither is one that improves utilisation but makes planning too complex for planners to use consistently.

SCM Champs’ approach is built on balance — transportation processes that weigh:

Cost

• Service
• Capacity
• Route feasibility
• Carrier availability
• Delivery requirements
• Operational practicality

Every transportation decision involves trade-offs. The technology’s role isn’t to eliminate them; it’s to make them visible and manageable.

What Our Role Looks Like 

When SCM Champs engages with a company facing rising transportation costs, we don’t start by assuming the answer is another optimisation setting. We start by understanding the business problem:

1. Where is transportation spend increasing, and what has changed?
2. How is transportation currently planned?
3. What data is being used, and what constraints matter?
4. Where are planners making manual decisions, and where are exceptions created?
5. How are carriers selected, and how are actual costs measured?
6. How does transportation connect with the wider SAP environment?

From there, we can find where the real gaps are. Depending on the business, that may involve:

• SAP TM configuration
• Planning strategy
• Master data
• Integration
• Optimisation
• Transportation process redesign

Often, it’s a combination. Our role is to bring these elements together into one practical improvement programme, rather than treating each issue as a separate technology problem.

From Transportation Spend to Transportation Control 

Increasing transportation costs are often treated as an unavoidable cost of doing business. They shouldn’t be.

Some cost increases are market-driven and genuinely unavoidable. Others are created by how the transportation network is planned and managed. The challenge for management is knowing the difference and that requires visibility. But visibility alone isn’t enough. The business needs the ability to act.

SCM Champs role as a certified SAP partner is to help make that happen: 

Working with companies to identify where transportation costs are being created

• Determine what’s driving them 
• Configure the transportation environment around the operational and commercial realities of the business. 

Because the objective was never another transportation report. It’s a clear, consistent answer to three questions:

Where is the money going? Why is it going there? What should we change?

If transportation spend is climbing in your organisation, and you don’t yet have a clear answer for what’s driving it, that’s exactly where we start. Our Free Transportation Assessment reviews your SAP TM planning, data and execution process to show you precisely where the cost is coming from & what to fix first.