Logistics firm Wincanton is in discussion with enterprise software supplier Manugistics to recover several million pounds after a software implementation failed to live up to expectations.
Charles Carr, marketing director at Wincanton, said, "We have taken the decision to write down £2.4m on our investment this year. The value of our investment was substantially more - several million - and that is what we are trying to recover from Manugistics."
He said the Manugistics software was a customised package of transport modules that was expected to reap savings but was never fully installed.
A source close to the implementation told Computer Weekly the software was considered "not fit for purpose".
Recently released financial results for Wincanton declare, "The decision has been taken to substantially write down the book value of our investment in a series of supply chain software modules. This has led to a £2.4m charge. We are currently in discussion with the supplier to seek to recover the costs of our investment."
Wincanton negotiated an exclusive tailored access arrangement with Manugistics for transport and retail software modules and has been rolling these out on a Europe-wide basis. Two years ago Wincanton's IT director said these changes were expected to give a double-figure percentage saving.
The systems were intended to manage demand and optimise transport operations while linking with the warehouse management system to ensure the right goods were located and dispatched at the right time.
Simon Bragg, an analyst at ARC Consulting, said, "You cannot take a standard design for transport software from a US company and expect it to work in Europe. European logistics are very different.
"At the same time there are dangers in customisation because not a lot of good transport software has been developed here."
Manugistics declined to comment.