Case Study | Strategic Transport Savings
Modul8 was engaged by an ASX Top 10 multi-industry organisation to deliver a step-change in freight efficiency across its industrial business unit. Through detailed lane-level cost analysis and direct negotiations with the incumbent 3PL, Modul8 secured over $4 million in immediate savings and an ongoing 8% annual cost reduction, while maintaining service quality and enabling future network flexibility.
1. Challenge
- High $80 million annual spend on distribution centre to store freight movements
- Established 3PL provider delivering strong service performance but at a premium cost base
- Limited ongoing commitment to year-on-year cost improvement or productivity gains
- Cost misalignment when benchmarked against comparable industry providers
- Need to achieve material and sustainable transport cost reduction without compromising service levels
2. Solution
Modul8 conducted a detailed review of the client’s transport cost base, including:
- Comprehensive lane-by-lane and day-by-day cost-to-serve analysis to identify inefficiencies
- Deep review of the 3PL’s rate card and pricing structure
- Engagement with internal stakeholders and direct negotiations with the incumbent 3PL over three months
- Focus on achieving a commercially sustainable rate structure aligned to the client’s business model
- Negotiation of key contractual changes, including:
- Immediate rate reductions
- Guaranteed year-on-year rate offsets
- Revised rating methodology
- Flexibility to accommodate future network consolidation and growth
3. Outcome
Financial
- $4 million+ in-year savings secured for FY26
- ~8% annual cost reduction from FY27 onwards through committed rate improvement
Strategic & Operational
- Locked-in savings for 5–6 years under a firm contractual framework
- Enhanced commercial transparency and long-term cost governance
- Flexibility to adjust freight volumes and network design without impacting guaranteed savings
- Maintained service quality and operational performance benchmarks