Delivery Services Efficiency Improvement: Case study of BKK Moving Services

Abstract

This research aims to increase the efficiency of transportation service for small freight business, who faces the problem of refusing to accept a job or rejecting the customer's transportation needs (demands). From the studies, it found that 7.7% of customer’s transportation demands were rejected, of which 90% of it was a long-distance transport service. The main reason of  the rejection is due to the redundancy of operating procedures which cause delays in the whole process and high cost of long-distance transportation. Therefore, this research presents the application of the Make or Buy strategy together with the calculation of transportation costs to analyze the outsourcing service provider to cooperate working with company’s self-operation. This strategy aims to reduce the company's operating costs, to reduce job rejection rate, and reduce the redundancy operation process of the company. The study found that : (1) The Make or Buy strategy encourages the company to adopt “Buy” or “Outsourcing” for long-distance transport service, due to it produces total cost of  27,319,500 baht lower than self-operating service in 10-year span financing comparison. (2) The results from using real data of the past 2 years also reviews that if the outsourcing services is adopted during those periods, 32.71% of total cost can be reduced. (3) The outsourcing services is adopted for the real operation during 4 months it reviews that the service rejection rate can be reduced to 7 %. (4) the company can reduce the operating processes from 8 steps to 5 steps, resulting in faster operation process with more efficient service.