About Wayne A. Siegert Expertise Transportation, Warehousing, Import and Export consolidations. Project Freight for overseas construction projects. Paper and Metals warehousing and distribution.
Experience Employment history: 10 years Wagner Industries Inc. Kansas City Missouri 5 years Owner AAA Transfer Kansas City Missouri 5 years Transnational Diversified Kansas City Missouri 5 years Trailer Train / Romar Transportation 5 years Owner Siegert Transportation Services Kansas City Missouri
Organizations: Transload Distribution Association North American Wholesale Lumber Association National Hardwood Lumber Association International Trade Club Kansas City Missouri
Education: Graduate University of KANSAS UNIVERSITY OF MISSOURI Transportation Degree
Question Hi! My company has recently set up a CDC (combined distribution centre). Our vendors used to arrange direct delivery to our retail outlets in all regions (by using third party transport). Today, we require vendors to deliver to our new CDC and would like to charge them a certain percentage of CDC charges in order to cover our CDC operation cost. Please advise how to define/calculate this CDC charges? Following are some information may help you to understand more about our operation:-
i) Our commodity is consumable item - plastic bags (for outlets to serve customers)
ii) Vendor's delivery pattern to our CDC - everyday
iii) Our total daily purchase amount - USD1500
iv) When CDC staffs receive vendor's goods(in carton), they need to break it and do putting, according to outlet's order quantity.(normally in packet, 1 packet = 500pcs plastic bags)
We charge this vendor 4% on total Invoice value for the cdc charges, vendor will give us credit note every end of the month. But how to justify this 4%? How to support this 4% in terms of product & price? Is there any formula to calculate CDC charges? Please advise.
Thank you.
Patty
Answer PATTY
YOU CAUGHT ME ON ONE OF THE "BAD" DAYS, SO HERE IS MY BAD
ANSWER.
IF I WAS YOUR VENDOR I WOULD IMMEDIATELY INCREASE YOUR BILL
BY 8%, TO COVER WHAT YOU WANT ME TO SUBSIDIZE AND ANOTHER
4% FOR JUST ASKING THAT I SUBSIDIZE YOUR CDC.
THE WALMART MENTALITY THAT PERMEATES OUR INDUSTRY WILL DRIVE
ALL OF US OUT OF BUSINESS.... WHO EVER SAID THERE IS A
GUARANTEE THAT WE MAKE A PROFIT IN THIS BUSINESS??????????
WE SUBSIDIZE THE TRUCKING FIRMS WITH FUEL INCREASES!!
AND NOW SUBSIDIZE THE CDC TO GET THEIR BUSINESS
NO THANKS
I THINK I WILL GO OUT AND RAISE SOME OF MY ACCOUNTS
TO SUBSIDIZE MY COST OF OPERATIONS.
