Freight delivery must be one of the more mundane aspects of a cable-system manager's existence. A cable executive may know much about many disparate disciplines — including technology, operations, marketing and public affairs — but freight transportation rarely makes the list.
Over the past year or so, though, several MSOs have began outsourcing vendor equipment-delivery tasks. One such contractor — Elk Grove Village, Ill.-based New Age Transportation — had landed national accounts with Time Warner Cable, Cox Communications and AT&T Broadband.
New Age coordinates the shipments of vendor products between cable-equipment suppliers and MSOs, insuring timely and accurate delivery while saving operators thousands of dollars in shipping costs.
"It's worked out really well," said Cox director of purchasing John Sarver. "It's saved us money and they have good follow-through."
Sarver estimated that Cox saved more $200,000 between August and September of this year alone.
Time Warner Cable director of purchasing Steve Gines said New Age has helped his MSO save hundreds of thousands of dollars. "With pre-pay, you lose a lot of auditing capabilities," he said, making reference to the old method, in which vendors would hire shipping companies and pass the costs along to MSOs.
With New Age, Time Warner can better control shipping costs. And there's an added benefit.
"The field people love it," Gines said. "They know where orders are and can get quick tracking."
President Carolyn Gable formed New Age in 1989. She entered the cable universe in the late 1990s, working for Pioneer Electronics Inc. and delivering set-tops to Time Warner systems across the country.
Gable's company served as a contract carrier. When Pioneer needed to ship set-tops to Houston or Charlotte, N.C., Gable worked with various trucking companies to see which could deliver the load quickly at the lowest price.
Gable's work with Pioneer caught the attention of Time Warner, which had hired a consultant to determine how much money it would save by using New Age to handle all its equipment deliveries. Time Warner liked the results and signed a contract with New Age in May 2000 for the company's 40 divisions.
Cox came aboard in May, Sarver said. Previously, Cox Enterprises Inc. had a freight contract with a national carrier. Although the rates were good, Sarver said, Cox Communications Inc. was the largest shipper within the company and accounted for 92 percent of all freight traffic.
But "the shipping industry can be a bit confusing," Sarver acknowledged, and without a freight manager on board, it was sometimes difficult to spot potential savings.
New Age audited some Cox shipping bills early in the year and told the MSO where it could cut costs. Cox can average 800 to 1,000 shipments a month to more than 100 sites across the country, Sarver said.