Phillips-Van Heusen Sews Up Global Ocean Freight Management System

Feb. 1, 2004
ALAMEDA, CA @ February 3, 2004 @ GT Nexus announced today it was selected by Phillips-Van Heusen Corporation (NYSE:PVH) to provide the hosted software,

ALAMEDA, CA @ February 3, 2004 @ GT Nexus announced today it was selected by Phillips-Van Heusen Corporation (NYSE:PVH) to provide the hosted software, services and integration infrastructure for the company’s global ocean freight management initiative.

Under the contract, GT Nexus will deploy a hosted technology platform through which PVH will centralize the management of global ocean freight operations. The system will support annual contract negotiations, analyze ocean freight expenses and optimize cargo allocation across a network of global carriers. GT Nexus also will provide integration and implementation services to launch the platform and configure the applications to Phillips-Van Heusen’s specifications.

PVH is the world’s largest shirt company and a global leader in the apparel and footwear industry. “Ocean freight is a key link for PVH’s global supply chain. Efficient management of this transportation resource is critical to our operations,” noted John Wells, Vice President @ Imports for PVH. “GT Nexus provides sophisticated, market- leading technology that PVH Logistics Services will employ to support the three PVH operating groups: Dress Shirts, Sportswear and Footwear.”

“The system is designed to enhance our ability to leverage our global corporate volume and negotiate favorable ocean freight contracts,” Wells noted. “It is also designed to provide the platform and tools to design and execute customized ocean transportation solutions which meet the unique cost and service requirements of each operating group.”

As a hosted service, PVH will access the system over the Web, eliminating the need for hardware purchases, software installations or additional in-house IT staff. The system will be deployed in a GT Nexus-managed private logistics network specifically for PVH and its partners. PVH will use the platform to manage global transportation logistics activities, including:

Ocean Services Procurement -- standardized, electronic tendering, bid evaluation, countering, negotiation and management of service proposals with multiple ocean carriers

Strategic Allocation Planning -- leveraging optimized models to create precise carrier and trade lane allocation programs to ensure consistent service levels and contract adherence while controlling costs

Digital Contract Management -- centralizing and standardizing all global ocean contracts in a single online database, enabling rapid access to up-to-date rate and service terms, and ongoing digital management of contract amendments

Shipment Planning and Optimization -- dynamically selecting the optimal carrier, voyage and routing for each order or shipment, based on user-defined business rules, driven from digitized pricing, service terms and operational schedule data.

Partner Management -- establishing collaborative business rules, processes and workflow with freight forwarders, 3PLs and ocean carriers to improve performance and compliance.

PVH sources ready-to-wear apparel and footwear from over 30 locations worldwide, bringing thousands of containerized cargo shipments into North America every year. With a multi-million dollar annual ocean transportation spend, PVH wanted to standardize and automate its procurement processes, gain better visibility through a single data store for contracts and rates, and apply optimization and analytical tools to improve its allocation and management of global freight volumes across carriers.

The goal of the technology initiative, according to Wells, is to support two objectives:

Control ocean freight expenses through better purchasing and optimization of ocean cargo services. Enhance service levels through optimization of transit times with carriers, and more effective monitoring and measurement of carrier and partner performance.

Wells noted that GT Nexus was selected based on its core competency in the ocean industry, the global focus of its solution, and the experience of other GT Nexus customers facing similar strategic logistics issues. “We found GT Nexus to be the right fit for our business. The system has a good track record with current customers, and is known to carriers already,” Wells said. “By contracting for the software as a service, we significantly reduce the up-front cost and risk, and we accelerate the implementation process.”