Fallout from 2020 continues to impact shippers globally due to container shortages, Covid related delays at ports, fluctuations in the cost of fuel, spikes in ocean shipping costs and increased volume. You may not be able to manage many of these variables but there are steps that you can take to reduce costs and keep loads moving.
- Cost of Out Of Stock – Production Delays – While freight is a significant cost, it may be less impactful than out of stocks or production delays due to shipping delays. Working with carriers that have been vetted and have strong performance histories is a key to keeping loads moving. Sometimes you may also calculate the costs of using premium shipping versus the cost of shutting down a production line.
- Low Volume Days – Some carriers may offer lower rates for shipments picked up on a Monday or a Tuesday. An experienced broker can help you identify carriers that will offer cost savings for loads on lower volume days.
- Back Hauls – Evening Dock Hours – Understanding carrier costs is the first step in being able to manage your freight costs as carriers generally need to pass on their costs to customers. Back hauls increase utilization of carrier’s trucks and staff so if your warehouse can accommodate evening dock hours, you are likely to benefit from carriers competing for these loads.
- Load Times – Another carrier cost is load time is the clock is ticking while the truck and driver are parked waiting to be loaded. Pricing is generally based on a two-hour load time. If a shipper gets a reputation for quick turnarounds at the dock, carriers will see that their efficiency and margins improve. Managing docks efficiently as a priority makes a shipper more appealing to carriers.
- Volume Contracts – Long term contracts are a way to lock in better rates, but not always feasible for many shippers. Working with a broker that manages many loads can position a shipper for better quotes based on the consolidated volume that broker brings to carriers.
If you are looking for a logistics provider that can help you delivered your products reliably and safely to its destination, you are welcome to contact 1st Choice Logistics. We look forward to a great partnership with you!