SCM3516 Temple University Tucker Company Transportation Management HW Please see attached for the case. Case Study:Teams will be provided with a specific c

SCM3516 Temple University Tucker Company Transportation Management HW Please see attached for the case. Case Study:Teams will be provided with a specific case study and will be required to analyze the problem, present their thought process and make a decision. The report is expected to be a short 2-3 page report. One submission per team. DRAFT
TUCKER COMPANY WORLDWIDE: DELIVERING VALUE IN
LOGISTICS SERVICES
Neha Mittal, Roman Szewczuk, and Subodha Kumar wrote this case solely to provide material for class discussion. The authors do
not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names
and other identifying information to protect confidentiality.
Version: 2019-02-01
Mike Mellencamp, carrier sales manager at Tucker Company Worldwide Inc. (TCW), a privately owned
third-party logistics (3PL) company based in Haddonfield, New Jersey, could feel the determination and
toughness in the voice of the company’s president and chief operating officer (COO), Jim Tucker: “Mike,
it is not just about being cheap, fast, and easy,” Tucker said. “We must provide the right and the best service
to our customer.” Mellencamp was working on a bid to provide logistics support to Bell Oil, a refinery
based in Reading, Pennsylvania. Winning this contract would enable TCW to establish itself as a regional
leader in the 3PL industry. As Mellencamp walked out of Tucker’s office, he realized that preparing the bid
would not be as straightforward as he had thought it would be. The proposal would need to effectively
showcase TCW’s value, address all practical transport options, and remain consistent with the company’s
core practice. Above all, Mellencamp had only that day, Friday, June 1, 2018, to bring it all together.
HISTORY OF TUCKER COMPANY WORLDWIDE
Tucker Company Worldwide, a third-generation, family-held corporation, was founded in 1961 by Jacob
Tucker. The company provided logistical services to shippers and their customers, helping companies
efficiently execute freight hand-offs; saving them time; and eliminating the hassles of paperwork, billing,
audits, training, staffing, and optimization. It acted as an intermediary both between shippers and receivers
and between shippers and carriers. Through its market knowledge and subject expertise, it often helped its
clients open new market opportunities, receive volume discounts, lower overhead costs, and achieve timely
service.
After Jacob’s sudden death, his son, Bill Tucker, took over the business. For the next 32 years, Bill
immersed himself in the business and industry. His two sons, Jeff and Jim, worked for their father for over
10 years and later took over the business; they shared a passion for the business and the industry. Jeff served
as the chief executive officer, overseeing sales and marketing, as well as industry participation and
leadership. Jim served as the president and COO, managing the carrier side, credit, collections, and
accounting.
Over the years, Jeff and Jim had built an outstanding reputation in the third-party logistics industry. TCW
was ISO certified in 2008, and it held ISO 9001:2015 certification as well. In all their business interactions,
the brothers strove to uphold their core values: customer focus, integrity, safety, quality, and advocacy.
SERVICES OFFERED BY TUCKER COMPANY WORLDWIDE
Page 2
As a non-asset-based company (i.e., it owned no trucks but worked with fleet operators), TWC provided
supply chain solutions to companies in industries such as oil and gas, life sciences and health care, highvalue and high-security goods, and food. It also provided services to government entities, for example,
providing relief work during national emergencies such as forest fires, hurricanes, and terrorist attacks;
freight services for the US Mint; and helicopters and boats for the military. TCW utilized an array of
transportation modes—including truck, rail, ocean, and air—to arrange logistics all over the world. It
offered truckload (TL), intermodal, flatbed, and specialized equipment for transporting freight. It
specialized in freight transportation that required higher service needs—that is, where the risk of shipment
lateness or cargo theft was high, where the delay consequences were high, and where there was visible
corporate behaviour dysfunction.
TCW also provided real-time tracking and tracing (through a customer portal), quarterly business reviews
(for existing customers), scorecards (based on shipping characteristics), and technology options that
included visual performance statistics. Customers appreciated these analyses by TCW and considered them
to be value-added services.
One thing that had set TCW apart from its competition was its investment in establishing strong
communication and visibility channels between its customers and service providers, including truck, air,
and ship carriers. This helped TCW create the right logistical solutions for its customers. Results from an
internal customer survey showed that, while TCW was not always the cheapest, it was one of the most
dependable and reliable partners for most of its clients.
THE REQUEST FOR PROPOSAL
On Friday, June 1, 2018, Bell Oil, a large refinery in Reading, Pennsylvania, sent out a request for proposal
(RFP) soliciting bids to transport multiple products from multiple origins to multiple destinations. The
refinery solicited local and regional third-party logistics companies to submit bids for three unique
transportation needs: The first requirement was to ship a highly critical, 67-kilogram (148-pound) gasket
from Houston, Texas, to Reading, Pennsylvania. The second requirement was to transport a large
102,058-kilogram (225,000-pound) tank from Houston, Texas, to Wilmington, Delaware. Third was a
small, 90-kilogram (200-pound), but highly valuable $48,600 computer server containing sensitive
company information, which was to be transported across the country, from Herndon, Virginia, to San Jose,
California.
According to the RFP, each component could use a combination of transport modes, but the best solution
should offer the best service in terms of transit time, reliability, damage rate, insurance, and of course cost.
Jim Tucker saw the call and asked his manager, Mellencamp, to begin working on the bid right away.
However, preparing the bid was not easy, and TCW had a set of challenges to overcome.
Page 3
TCW’S CHALLENGE
Customers always preferred solutions that were cheap, fast, and easy. Shippers and receivers would often
forget the importance of advance planning and would not communicate their needs clearly. Customers also
assumed that the right vehicle with the desired transit time, reliability, insurance terms, and damage rates,
would be available. This last-minute attitude increased the overall transportation costs for most customers
and became the enemy of corporate savings. TCW knew that overcoming this attitude would be its first
challenge. It could not provide the lowest-cost option to its customer if the customer waited until the very
last moment.
Jim Tucker wanted to prepare a bid that exceeded expectations for customer service and satisfaction—a
solution that provided the lowest-cost option while maintaining the required reliability and service to
successfully transport the shipments. He knew that an overly expensive option would jeopardize TCW’s
chances of winning the bid.
Tucker and Mellencamp recognized that they were competing with other 3PL companies in the region on
this bid. They understood the market and were aware of the different strategies that their competition might
use—and they were afraid the competition might present a low-ball offer that might be attractive to the
customer. At the same time, they were confident that the competition could not deliver the experience and
service that TCW could offer.
Tucker was aware of several past instances where a competitor 3PL had bid on and lost a deal because of a
lack of communication and feasibility analysis from the trucking company and driver. Conversely, TCW
had seen competitor 3PLs win business but then be unable to follow through and meet customer
expectations, leading to aggravated customers. Tucker and Mellencamp discussed their strong
communication channel, which kept all involved parties in touch at all times, as well as their forensic
dispatch1 practice, which had been successful over the years. They were confident that a careful
examination of available options and clear communication of the customer’s needs would enable TCW to
provide the best logistical solution for the Bell Oil refinery.
TCW’S TRANSPORT OPTIONS
To prepare the bid, Mellencamp carefully examined all shipping options for serving the refinery’s three
specific needs. He prepared three different tables for the three different scenarios and shared these with
Tucker. Together, they needed to create a bid that not only minimized transport costs but also maximized
reliability and customer satisfaction.
Shipment Requirement 1: Ship a 67-kilogram (148-lb) gasket from Houston, Texas, to Reading,
Pennsylvania.
In this requirement, the customer wanted to move a 67-kilogram gasket, which was critical to the normal
operation of the refinery. If the gasket were needed, a delay of one day in receiving it could result in millions
of dollars in losses for the refinery. Mellencamp evaluated the different shipping options and prepared a
table that compared the different components of each option (see Exhibit 1).
1
Forensic dispatch was a practice where truck drivers were called by the company before they picked up each load in order
to gauge the driver’s readiness, awareness of both shipment- and customer-specific requirements, and ability to make the
pick up and delivery on time.
Page 4
Shipment Requirement 2: Ship a 102,058-kilogram (225,000 lb) tank from Houston, Texas, to
Wilmington, Delaware.
In the second requirement, the customer wanted to move a 102,058-kilogram tank from Texas to Delaware.
Mellencamp considered four different transport options to move this oversize load across state boundaries:
Option 1 was to pick up the vessel from the manufacturer and move it on a 19-axle trailer over-the-road
(OTR) to its final destination (see Exhibit 2).
Option 2 was to pick up the vessel from the manufacturer and move it OTR to the rail ramp in Houston,
then transload and move it on rail to the customer site via a local rail line. Finally, the vessel would be
transloaded and delivered to the final location on a 19-axle trailer.
Option 3 involved picking up the vessel from the manufacturer and moving it OTR to the port in Houston,
then transloading it onto a barge and barging it to the port in New Castle, Delaware. Finally, it would be
transloaded to a 19-axle trailer and moved OTR to its final destination.
Option 4 was to pick up the vessel from the manufacturer and move it OTR to the port in Houston, then
transload it onto a barge and barge it directly to the customer’s site. (This option would require site
improvement on the customer’s end.) Finally, the vessel would be transloaded and delivered to the
installation site.
Mellencamp prepared a table listing all the feasible transport options to carry out this oversize load
transportation (see Exhibit 3).
Shipment Requirement 3: Ship an estimated 90-kilogram (200-lb) computer server valued at
$48,600 from Herndon, Virginia, to San Jose, California. Shipper thinks the dimensions are
roughly (36 × 36 × 40) inches.
Under the third and the last requirement, the customer required a computer server with very sensitive
corporate information to be transported coast to coast. Mellencamp developed a set of feasible solutions to
successfully carry out this transportation (see Exhibit 4).
THE DECISION
Based on the transport choices developed by Mellencamp, the challenge was to come up with a decision
for each shipment requirement that would become part of the final bid. How should he go about making
the right logistical decision? What strategy should he use to prepare TCW’s bid, given that in part 1 of the
case, Mellencamp at TCW is unable to connect with the procurement manager at Bell refinery and cannot
get any more information than what is provided in the RFP, and in part 2 of the case, TCW is able to
communicate with the procurement manager at Bell and ask specific for information he may need to make
the final decision on these shipment requirements. Do you expect to observe any difference in the logistical
decision made under the two cases?
Page 5
EXHIBIT 1: OPTIONS FOR TRANSPORTING A 67-KILOGRAM GASKET
FROM HOUSTON, TEXAS, TO READING, PENNSYLVANIA
Mode
LTL
LTLExpedited
2-Day Air
1-Day Air
TL
TL-Team
TLExpedited
Airplane
Charter
Availability
for Same
Day
99.9%
Transit
Time (days)
Reliability
Damage
Insurance
Cost
(US $)
5.0
85.00%
6.00%
N
150
99.9%
4.0
88.00%
6.00%
N
200
98.0%
98.0%
93.0%
92.0%
2.0
1.0
3.0
2.0
99.00%
99.00%
95.00%
95.00%
1.50%
0.20%
1.50%
1.50%
N
N
Y
Y
1,300
1,750
1000
1,500
96.0%
2.0
98.00%
1.50%
Y
4,500
100.0%
0.2
99.99%
0.10%
N
25,000
Notes: The data in the table (modes, related parameters, and costs) has been disguised;
LTL = less than truckload (freight companies that consolidated a large volume of small shipments from multiple parties and
carried them in a truck);
LTL-Expedited = freight moved by the same method as standard LTL, but with some level of money-back guarantee;
2-Day or 1-Day Air = freight moved by an air cargo service, with rates dependent on the transit times and dimensions of
specific freight;
TL = truckload (freight companies that moved shipments in 48-foot or 53-foot trailers where the shipper was allowed the full
trailer; rates charged for this service were not dependent on weight or how much space was used on the trailer);
TL-Team = the same as TL shipping but with two drivers instead of one (when one took the wheel, the other rested, cutting
transit time to half of standard TL times);
TL-Expedited = expedited service offered by freight companies who specialized in attracting highly reliable drivers by paying
them above market rates (TL-Expedited often moved by either TL or TL-Team, but was a more expensive option);
Airplane Charter = the most expensive option, in which an unscheduled flight was chartered (i.e., the shipper rented the entire
aircraft and dictated the departure/ arrival locations and times).
Source: Company documents
EXHIBIT 2: ILLUSTRATION OF A 102,058-KILOGRAM TANK ON A 19-AXLE TRAILER
Page 6
EXHIBIT 3: TRANSPORT OPTIONS FOR SHIPPING A 102,058-KILOGRAM TANK
FROM HOUSTON, TEXAS, TO WILMINGTON, DELAWARE
Likelihood
of
Additional
Costs
Estimated
Transit
Time
Planning
Time
Required
Survey(s)
Required
Escorts
Required
Police
Involvement
Additional
Cranes
Route
Complexity
Likelihood
of Transit
Delay
Likelihood
of Freight
Damage
Additional
Insurance
Required
1 $175,000
High
8–10
Business
Days
2 Months
Road
Road &
Utilities
Extreme
None
Highly
Complex
High
Moderate
None
2 $135,000
Low
2–3
Months
4 Months
Road &
Rail
Limited
Road
Limited
+1 Lift
Simple
Low
Limited
None
3 $410,000
Moderate
3 Weeks
4 Months
Road
Road &
Utilities
Moderate
+2 Lifts
Moderate
Moderate
Moderate
Maritime
4 $390,000
High
3 Weeks
6 Months
– 1 Year
Road &
Water
Limited
Road
Limited
+1 Lift
Simple
Low
Limited
Maritime
Estimated
Cost
Note: Data in the table (modes, related parameters, and costs) is disguised.
Source: Company documents
Page 7
EXHIBIT 4: TRANSPORT OPTIONS FOR MOVING A 90-KILOGRAM COMPUTER SERVER COAST TO COAST
Mode
Required
Time to
Schedule
(Hours)
Weight
Change
Affects
Cost?
Dimension
Change
Affects
Cost?
Transit
Time
(Days)
Reliability
Likelihood
of Damage
Insurance
Coverage
(in US
dollars)
Cost (in
US
dollars)
LTL
1
Y
N
7
75.0%
6.00%
$1,000
$362
Next Day Air
4
Y
Y
1
90.0%
0.20%
$200
$5,800
Cargo Van (no Air Ride)
8
N
Maybe
5
95.0%
3.00%
$48,600
$3,000
Team Cargo Van (no Air Ride)
8
N
Maybe
3
98.5%
3.00%
$48,600
$3,645
Air Ride
8
N
N
6
95.0%
1.25%
$48,600
$4,000
24
N
N
3
98.0%
1.25%
$48,600
$5,200
24–48
N
N
6
95.0%
1.25%
$48,600
$4,200
24–48
N
N
3
98.0%
1.25%
$48,600
$6,500
165
(1 Week)
N
N
6
99.0%
0.50%
$48,600
$15,500
4
N
N
1/4
99.9%
0.10%
$200
$44,235
Team Air Ride
High-Value Air Ride with Security
Safeguards
Team High-Value Air Ride with
Security Safeguards
Brinks-Type Armed Escort
Transport
Charter Airplane
Note: Data in the table (modes, related parameters, and costs) is disguised; Cargo Van (no Air Ride) = small van-sized trailers with standard spring suspension systems;
Team Cargo Van (no Air Ride) = two drivers, instead of one, riding in a small van with standard spring suspension system; Air Ride = trailers with air suspension system to
reduce the vibration and likelihood of product damage inside the trailer; Team Air Ride = two drivers, instead of one, riding in a trailer with air suspension system; Brinks-Type
Armed Escort Transport = highly secured logistics solution that entailed superior technology and communication systems, often including locked doors, geo-fencing or cameraenabled trailers, and armed drivers.
Source: Company documents

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