With the increase in the number of online businesses, the demand for logistics solutions has taken a huge leap. With the big brands outsourcing their logistics services, it has turned into one of the largest revenue generating industries.
The logistics services are responsible for everything covering “what”, “where” and “how” to deliver. And therefore, an efficient supply chain is deemed to be the back bone of any affluent logistics service, while at the same time, over-paying for the required efficiency is unnecessary. Apparently, with the few cost cutting strategies, logistics services can indeed generate huge profits with decreased investment. So to facilitate you with such cost cutting measures, here is the list of few tips which can be implemented to cut logistics costs while effectively maintaining the quality of service:
Eliminate the factors that vary delivery time: The variation in the transient time is often compensated with higher inventory and warehouse stock which corresponds to higher rents. This additional cost can be easily reduced and avoided by eliminating the variability.It can be done by gaining a reliable insight on the future orders by the help of various visibility softwares. Thus, this information would cut the size of inventory and facilitate the timely delivery.
Avoid detention fines: These bills may not effect initially, but gradually they add up into a huge sum. So keep a track of all your shipments and take into consideration the repeated fines with their reasons. Such slight changes can save a huge amount of money in the long run.
Coordination: If a huge number of items are to be shipped from a country then it would be beneficial to store and confine the goods within one container whereas if the number of items to be shipped is less, it would be cost effective to collaborate with another logistics service. This would hugely reduce the shipment cost while increasing the chance of timely deliveries.
Over expenditure on insurance: Most of the companies are self insured while the carrier insurance being covered in the policy. So avoid wasting money on extra carrier insurance as we tend to buy these extra carrier insurance on the shipment of the premium goods. So before going for an extra insurance cover, go through your self insurance policy and opt accordingly.
Control shipping cost: We always end up over paying on the express shipping. So in order to avoid it, divide the goods that are to be expressly shipped and those which can be shipped normally. Proper calculations and timely estimations can effectively help you in figuring out the right amount of the goods that are to be shipped immediately.Avoiding stress and confusion is the key here.
Timely planning: Though it is one of the most regarded and followed tip, more often than not we fail to comply by it. So to effectively reduce the expenditure, plan well ahead of time. If you have to ship a consignment overseas, then timely book the air, water or rail services as the last minute bookings are always expensive. In addition, timely planning of tasks leaves you with an essential time to look out for other consolidating services, which can further reduce the shipping cost of your logistics solution.