System and method for effectuating the creation and management of customer pick-up/backhaul programs between buyers and sellers in a supply community

• US 20050209869A1
• Filed: 03/22/2004
• Published: 09/22/2005
• Est. Priority Date: 03/22/2004
• Status: Active Grant

• Current Assignee: IGIT Enterprises Incorporated
• Original Assignee: IGIT Enterprises Incorporated
• Inventors: Irvin, Charles F.
• Granted Patent: US 7,467,091 B2
• Time in Patent Office: Days
• US Class Current: 705/39
• CPC Class Codes: G06Q 10/08 Logistics, e.g. warehousing, loading or distribution; Inventory or stock management
• CPC Class Codes: G06Q 10/083 Shipping
• CPC Class Codes: G06Q 10/0835 Relationships between shipper or supplier and carriers
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems

Abstract

A business method and system that effectuates collaboration on Customer Pick-UP (CPU) between one or many buyers (customers) and sellers (suppliers) in a supply community. The method and system have particular utility in markets where the standard terms of sale are Destination Delivered. The method and system enables sellers to create, configure and maintain seller-specific CPU programs having at least one strategy option and at least one CPU allowance unit rate structure option which can be contemporaneously accessed by buyers to identify potential CPU opportunities and then submit a CPU proposal/request, each based on a single CPU strategy option, to one or more sellers, wherein the CPU proposal/request is a collaboration invitation, a supply bid or a request for a lane allowance quotation structured to facilitate structured to facilitate the agreement of a mutually acceptable CPU allowance unit rate consistent with the selected CPU strategy option. The system includes an internet-based program tool within which the seller can specify the rules used to select the most appropriate CPU allowance unit rate structure option for calculating the CPU shipment allowance and the seller can utilize a gainshare module to pay the buyer the agreed CPU allowance for any CPU shipments.

Claims

1. In a system for effectuating collaboration on a customer pick-up program and allowance management between one or many sellers and one or many buyers (partners) in a supply community which enables the one or many sellers to create, configure, and maintain a customer pick-up program, enables the one or many buyers to contemporaneously access, query, and view customer pick-up program and seller location information to identify potential customer pick-up program opportunities, enables a buyer and a seller to collaboratively establish a mutually acceptable customer pick-up! Program strategy from a collection of one or many customer pick-up program strategy options and to establish customer pick-up program allowances, and to determine the customer pick-up program allowance for a specific shipment by the selected customer pick-up program allowance unit rate structure option selected by the seller, the method including the steps of:

the seller creating a customer pick-up program by selecting at least one customer pick-up program strategy option, selecting at least one customer pick-up program allowance unit rate structure option, and selecting the decision rules by which the customer pick-up program allowance unit rate structure option is selected to determine the customer pick-up program allowance for a single shipment;

the seller providing required information for at least one seller shipping location;

the buyer one of the at least one customer pick-up program strategy options selected by the seller and submitting a customer pick-up program proposal and request to seller, wherein the structure and content of the customer pick-up program proposal and request is determined by the just one selected strategy option;

the buyer and seller selecting a customer pick-up allowance unit rate and at least one customer pick-up program allowance unit rate structure option for each customer pick-up program allowance; and

determining the customer pick-up allowance for a specific shipment using the selected customer pick-up allowance unit rate structure option.

2. The method as claimed in claim 1 wherein the seller creates a customer pick-up program by entering attribute data including the customer pick-up program strategy, policy, procedures, shipping location profiles, and the customer pick-up program allowance and allowance unit rate formulae.

3. The method as claimed in claim 2 wherein the at least one customer pick-up program strategy option selected by the seller is from the group of options including collaborative gainsharing, for-hire transportation provide and the customer pick-up customer options

4. The method as claimed in claim 3 wherein the gainshare allocation factor by which the net cost savings are to be allocated between the partners in the collaborative gainsharing strategy option is within the range of 0% with no allocation to the customer pick-up program buyer and 100% with a total allocation to the customer pick-up program buyer.

5. The method as claimed in claim 1 wherein the at least one customer pick-up program allowance unit rate structure is selected by seller from a group of options including hundredweight basis ($/cwt), cube basis ($/cubic feet), pallet basis ($/pallet count), flat rate per purchase order basis ($/purchase order), flat rate per shipment basis ($/shipment) and percentage of invoice basis (% of invoice $ value).

6. The method as claimed in claim 1 wherein a single decision rule is used to select the just one customer pick-up program allowance unit rate structure to be applied to a single shipment, the decision rule being selected from the group including the default option specified by seller and buyer, the option that maximizes the customer pick-up program allowance, the option that minimizes the customer pick-up program allowance and a flat rate option.

7. The method as claimed in claim 2 or 6 wherein the customer pick-up allowance formulae are

$\mathrm{CPU}$

 

⁢

Allowance ⁢

 

⁢

Unit ⁢

 

⁢

Rate ⁢

 

⁢

( $ / UOM ) = ( Gainshare ⁢

 

⁢

Allocation ⁢

 

⁢

Factor ) ×

{ ( Scaling ⁢

 

⁢

Factor ) ×

[ ( Line ⁢

 

⁢

Haul ⁢

 

⁢

Cost ) + ( Fuel ⁢

 

⁢

Adjustment ⁢

 

⁢

Term ) ] + Accessorial ( Standard ⁢

 

⁢

No .  

⁢

of ⁢

 

⁢

Units ) $\mathrm{CPU}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Allowance}<br><br>\text{\hspace{1em}<br><br>}<br><br>\left(\$\right)=\left(\mathrm{Performance}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Factor}\right)\times <br><br>\hspace{1em}<br><br>\left[\left(\mathrm{CPU}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Allowance}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Unit}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Rate}\right)\times <br><br>\left(\mathrm{No}.\text{\hspace{1em}<br><br>}<br><br>\mathrm{of}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Units}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{on}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Shipment}\right)\right]$

8. The method as claimed in claim 1 wherein the criteria used by the buyer to identify potential customer pick-up program opportunities are selected from the group of criteria options including customer pick-up program strategy, policy, procedures, customer pick-up allowance formulae, shipping location and profiles, and shipment volume and volatility

9. The method as claimed in claim 1 wherein the approval of customer pick-up program allowance payments from seller to buyer is effected by using an option selected from the group of options including a manual review and approval by the seller of each customer pick-up program allowance, by the seller and the systematic and automatic approval of each customer pick-up program allowance.

10. The method as claimed in claim 3 wherein payment of the customer pick-up allowance is effected using an option selected from the group of options including an off-invoice line item credit in the amount of the customer pick-up program allowance, a freight bill in the amount of the customer pick-up program allowance and use of the gainshare module to credit the buyer and debit the seller in the amount of the customer pick-up allowance.

11. The method as claimed in claim 1 wherein the buyer submits a customer pick-up program proposal and request to more than one customer pick-up program sponsor to consolidate more than one order on a single shipment and thereby pick up less then full truckload orders at more than one location.

12. The method as claimed in claim 1 wherein the line haul charge component of the customer pick-up program allowance unit rate is from time to time updated for changes in the fuel adjustment term as specified by the seller.

13. The method as claimed in claim 1 wherein the buyer and seller may be within the same corporate entity.

28. The method as claimed in claim 1 wherein the buyer reviews the customer pick-up program and location information to identify sellers and seller shipping locations that may be potential customer pick-up program opportunities.

30. The method as claimed in claim 7 wherein the scaling factor can be between 0 and any positive number.

32. The method as claimed in claim 7 wherein the performance factor can be between 0 and any positive number.

34. The method as claimed in claim 7 wherein the fuel adjustment term can be less than 0, greater than 0, and 0.

36. The method as claimed in claim 7 wherein the accessorials can be less than 0, greater than 0, and 0.

14. A system for effectuating collaboration in a customer pick-up program and allowance management between one or many sellers and one or many buyers (partners) in a supply community which enables the one or many sellers to create, configure, and maintain a customer pick-up program, enables the one or many buyers to access, query, and view the customer pick-up programs and seller location information to identify potential customer pick-up program opportunities, enables a buyer and a seller to collaboratively select and establish a mutually acceptable customer pick-up program strategy from a group including one or many customer pick-up program strategy options and to negotiate and agree customer pick-up program allowances and enables ! the determination of the customer pick-up allowance for a specific shipment by a selected customer pick-up program allowance unit rate structure option, the system comprising:

means for a seller to create a customer pick-up program by selecting at least one customer pick-up program strategy option, selecting at least one customer pick-up program allowance unit rate structure option, and selecting the decision rules by which one customer pick-up program allowance unit rate structure option is selected;

means for a seller to enter the required information for at least one seller shipping location in the customer pick-up program;

means for a buyer to select one of the at least one customer pick-up program strategy options selected by the seller and submit a customer pick-up program proposal and request to seller, wherein the structure and content of the customer pick-up program proposal and request is determined by the just one selected strategy option;

means for a buyer and seller to select customer pick-up program allowance unit rates and at least one customer pick-up program allowance unit rate structure option; and

means to determine the customer pick-up program allowance for a specific shipment using the customer pick-up program allowance unit rate structure option selected by the seller.

15. The system as claimed in claim 14 wherein a seller creates a customer pick-up program by entering attribute data including the customer pick-up program strategy, policy, procedures, shipping locations, the customer pick-up program allowance and the customer pick-up program allowance unit rate formulae.

16. The system as claimed in claim 15 wherein the at least one customer pick-up program strategy option selected by the seller is from the group of options including collaborative gainsharing, for-hire transportation provider, and customer pick-up customer options.

17. The system as claimed in claim 16 wherein the gainshare allocation factor by which the net cost savings are to be allocated between the partners in the collaborative gainsharing strategy option is within the range of 0% with no allocation to the customer pick-up program buyer and 100% with a total allocation to the customer pick-up program buyer.

18. The system as claimed in claim 15 wherein the at least one customer pick-up program allowance unit rate structure option is selected by seller from a group of options including hundredweight basis ($/cwt), cube basis ($/cubic feet), pallet basis ($/pallet count), flat rate per purchase order basis ($/purchase order), flat rate per shipment basis ($/shipment), and percentage of invoice basis (% of invoice $ value).

19. The system as claimed in claims 15 or 18 wherein the single decision rule used with the customer pick-up program allowance unit rate structure to be applied to a shipment is selected from the group including the default option specified by seller and buyer, the option that maximizes the customer pick-up program allowance, the option that minimizes the customer pick-up program allowance, and a flat rate option for a purchase order or shipment.

20. The system as claimed in claim 14 or 19 wherein the customer pick-up program allowance formulae are

$\mathrm{CPU}$

 

⁢

Allowance ⁢

 

⁢

Unit ⁢

 

⁢

Rate ⁢

 

⁢

( $ / UOM ) = ( Gainshare ⁢

 

⁢

Allocation ⁢

 

⁢

Factor ) ×

{ ( Scaling ⁢

 

⁢

Factor ) ×

[ ( Line ⁢

 

⁢

Haul ⁢

 

⁢

Cost ) + ( Fuel ⁢

 

⁢

Adjustment ⁢

 

⁢

Term ) ] + Accessorials } ( Standard ⁢

 

⁢

No .  

⁢

of ⁢

 

⁢

Units ) $\mathrm{CPU}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Allowance}<br><br>\text{\hspace{1em}<br><br>}<br><br>\left(\$\right)=\left(\mathrm{Performance}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Factor}\right)\times <br><br>\hspace{1em}<br><br>\left[\left(\mathrm{CPU}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Allowance}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Unit}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Rate}\right)\times <br><br>\left(\mathrm{No}.\text{\hspace{1em}<br><br>}<br><br>\mathrm{of}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Units}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{on}<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{Shipment}\right)\right]$

21. The system as claimed in claim 14 wherein the criteria selected by the buyer to identify potential customer pick-up program opportunities are from the group of criteria options including customer pick-up program strategy, policy, procedures, customer pick-up program allowance formulae, shipping locations and profiles, and shipment volume and volatility.

22. The system as claimed in claim 14 wherein the approval of customer pick-up program allowance payments from seller to buyer is effected by using an option selected from the group of options including a manual review and approval by the seller of each customer pick-up program allowance and the systematic and automatic approval of each customer pick-up program allowance.

23. The system as claimed in claim 14 wherein the payment of the customer pick-up program allowance due from the seller uses an option selected from the group of options including an off-invoice line item credit in the amount of the customer pick-up program allowance applied to the invoice for the goods, a freight bill in the amount of the customer pick-up program allowance submitted by the buyer to the seller, and use of the gainshare module to credit buyer the amount of the customer pick-up program allowance.

24. The system as claimed in claim 14 wherein the buyer submits a customer pick-up program proposal to more than one customer pick-up program partner to consolidate more than one order on a single shipment and thereby pick up less than full truckload orders at more than one location.

25. The system as claimed in claim 14 wherein the line haul charge component of the customer pick-up program allowance unit rate is from time to time updated for changes in the fuel adjustment term as specified by the seller.

26. The system as claimed in claim 14 wherein the buyer and the seller may be within the same corporate entity.

27. The system as claimed in claim 14 wherein the system is modular in design and the modules include a customer care module, a data entry and management module, a transaction module, a customer pick-up program creation and management module, a performance and compliance module, an incentive program creation and management module, and an account management module.

29. The system as claimed in claim 14 wherein the buyer reviews the customer pick-up program and location information to identify sellers and seller shipping locations that may be potential customer pick-up program opportunities.

31. The system as claimed in claim 20 wherein the scaling factor can be between 0 and any positive number.

33. The system as claimed in claim 20 wherein the performance factor can be between 0 and any positive number.

35. The system as claimed in claim 20 wherein the fuel adjustment term can be less than 0, greater than 0, and 0.

37. The system as claimed in claim 20 wherein the accessorials can be less than 0, greater than 0, and 0.

39. The system as claimed in claim 14 wherein the buyer submits customer pick-up program and request to seller.

38. The method as claimed 1 wherein the buyer submits a customer pick-up program and request to seller.