November 30, 2022
Freight & Logistics -
10 Tips To Reduce Freight Transportation Costs |OneLink Holdings
Shipping your goods is no easy task. With the amount of costs and time-consuming elements involved, you have to be smarter about how you do it. Here are the OneLink Holdings top ten tips to help reduce your freight transportation costs!
If you’re in the business of shipping goods, then you know that freight transportation costs can eat into your profits if they’re not managed properly. Thankfully, there are a few things you can do to keep your freight costs under control. In this blog post, we’ll share 10 tips to help you reduce your freight transportation costs.
1. Review Your Rates Regularly
One of the best ways to reduce your freight transportation costs is to review your rates on a regular basis. By shopping around and comparing rates, you can make sure that you’re getting the best possible deal. Additionally, don’t be afraid to negotiate with your current providers. If they know that you’re willing to switch to a competitor, they may be more likely to offer you a better rate.
2. Use Technology To Your Advantage
There are many powerful tools available that can help you save money on freight. For example, using a freight audit and payment platform can help you catch billing errors so that you only have to pay for the services that you actually received. Additionally, there are many online marketplace platforms that can help you find the cheapest rates from different carriers. Freightos, a global freight comparison, booking and management system for over 10,000 companies is a popular online service used to obtain quotes for various shipments. It also allows businesses to book directly with freight companies and freight forwarder services.
3. Decide on the Best Container Capacity
Shipping less-than-container load (LCL) can generally be cheaper than full container load (FCL). This is because LCL shipments are consolidated with other shipments going to the same general area, which results in lower per-shipment costs. However, when calculating costs, a LCL will cost more than a FCL when using per unit of freight. Therefore, the cost of shipping can be more economical in the long run for businesses to fill a full container at the time of shipment. It’s important to note that LCL shipping can sometimes take longer than FCL shipping, so be sure to factor in transit time when deciding which option is right for your business.
4. Avoid Time-Sensitive Shipments
If your shipment is not time-sensitive, choosing a cheaper but slower shipping option is often the best way to go. For example, opting for ground or cargo shipping instead of air shipping will almost always save you money. Yes, it will take longer for your shipment to arrive, but it will also cost less. So, unless time is of the essence, choosing a slower but cheaper option is usually the best way to go. A couple of days difference of shipping time can cut a few hundred dollars off the bill, so if your business can wait a few extra days for it to arrive, generous savings can be made.
5. Use The Right Packaging
Believe it or not, using the right packaging can also help you save money on freight shipping costs. This is because if your shipment arrives damaged, you’ll likely have to pay for costly repairs or replacements. As such, it’s important to use packaging that will adequately protect your shipment from damage during transit. The type of packaging used in the shipment can also affect the total weight, as well as the need for a pallet which would increase the weight and also size of your packaging. If you are unable to unload without the use of a forklift then this is also a viable option to reduce costs.
6. Reduce The Weight Of Your Shipments
The heavier your shipment is, the more it will cost to ship. As such, one way to reduce your freight transportation costs is to make sure that your shipments are not overweight. Using lighter-weight materials such as corrugated cardboard instead of wood can help reduce the weight (and cost) of your shipments. Corrugated cardboard is a great option, as it is very durable, lightweight, relatively inexpensive and environmentally friendly. Packing inserts such as air pillows, bubble wrap and foam inserts are a great way to protect items without adding the extra weight. About 20% of extra shipping charges come from adjustments to chargeable weight, as items are not correctly weighed or packed when ready for placement into containers.
7. Avoid Peak Shipping Times
There are two main peak shipping periods: the holiday retail period from mid-August to mid-October and a shorter period for Chinese New Year in January and February. Shipping during these times can often cost more due to increased demand from other shippers vying for space on trucks, planes and ships. With the increase of demand skyrocketing and prices rising accordingly, container space becomes limited. Shipping companies will also charge a peak season surcharge on top of the higher base rates. So, if possible, try avoiding shipping during peak periods.
8. Consolidate Your Shipments
If you have multiple shipments going to the same general area, try consolidating them into one larger shipment instead of sending them individually. Doing this will often lower your overall shipping costs. Once the shipment has arrived at a consolidation centre, goods will be distributed locally. When choosing suppliers it would be a good idea to choose suppliers within the same area or province to save on internal transport charges to your freight forwarders warehouse.
9. Inventory Management
Maintaining an accurate inventory can also help reduce your freight transportation costs. This is because if you frequently over-order inventory, you’ll end up paying to ship products that sit unused in storage. On the other hand, if you frequently under-order inventory, you may end up paying Rush Shipping fees because you need products shipped quickly. So, maintaining an accurate inventory count can help ensure that you don’t overpay for shipping
10. Choose Your Carrier Carefully
Not all carriers are created equal. Some specialize in certain types of shipments while others have a more diverse range of offerings. As such it’s important that you choose a carrier that offers services that fit your specific needs. For example, if you frequently ship heavy or large items, you’ll want to choose a carrier with experience in handling those types of items. Another important consideration is the company’s reliability and reputation. Unreliable companies can be known to delay shipping times, which can cause significant damage to your business and your customers. Choosing a company with a bad reputation can mean your shipments are going to be delayed or arrive damaged. Taking the time upfront to choose the right carrier can make a big difference in how much you ultimately pay for shipping services.
There are many ways that businesses can reduce their freight transportation costs. By reviewing rates regularly, taking advantage of technology and choosing the right carrier, businesses can save themselves a significant amount of money. By optimizing freight costs, businesses can ensure the company is maximizing their return on investment and managing the supply chain efficiently.
The OneLink Holdings team are specialists in the freight and logistics world. Whether you’re after a freight forwarding service, or needing us to manage the whole process, we can help. We are passionate about getting the best deals for our clients, with their interests at the forefront of our decisions. Contact us today info@onelinkholdings.com to find out more about how we can get your goods to your front door, stress free.
Written By
One Link Holding team
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