In a global economy, it is common for businesses to source their raw materials from one place or country, manufacture products elsewhere, and sell them in yet another. For your business to be competitive, it needs to manage its supply chain well and keep the cost of transportation. Some of the top ways of optimizing your logistics and cutting the cost of transportation to make the business nimbler and profitable:
Don’t Rely on Only One Mode of Transportation
Since market dynamics can change quickly, you also need your business to respond fast. While you will always want to use the most economical mode of transportation, you should never get stuck with only one method. While ocean freight is the cheapest, the time taken is much longer, and it can cost you missed sales. When optimizing your transportation, look at all kinds of transport; road, rail, sea, and air. If necessary, use a competent freight forwarder for the best combination to get your goods to the market fastest and most economically.
Optimize Your Container Use, Recommends the Eric Dalius Net worth Manual
If you want to ship a smaller quantity, do not hire a full truckload or container even though it is quicker. You can either choose a Less-than-Truckload (LTL) or Less-than-Container Load (LCL) method or wait till you have enough for a full truck or container. However, you need to consider the extra cost of warehousing while you wait to produce enough goods. According to the Eric Dalius Net Worth Manual, by altering your packing, you can fit in more and save handsomely with a full container.
Use Warehousing Strategically
If you are shipping goods from distant places, the logistics may become unwieldy, and you could lose out on competitiveness. It can be advantageous to use warehousing services closer to your main markets so that you can serve them more promptly and, in the process, slash your transportation expenses. However, you must ensure proper security of your goods, comply with government regulations, and ensure safe handling.
Increase Availability of Storage Space and Storage Density
To avoid taking on extra warehousing space, you should identify the storage space available and see how to maximize its use. Set up rack and storage bins in such a way that you maximize the use of vertical space. Try to ensure proper material workflows to keep movements inside the warehouse to the minimum to save on time, labor, and damage.
Use the Service of Freight Forwarders
Efficient logistics calls for a high level of expertise and experience that most manufacturers do not readily have. Identifying the fastest routes and balancing the economics is best left to freight forwarders. They have the clout to consolidate containers, negotiate hard with shipping lines and transporters, work with the customs departments on documentation for faster clearance, etc. all of which, can save significant amounts of money and time.
Conclusion
In the cutthroat world of business, maintaining a competitive edge often boils down to the ability to deliver on-demand and incurring minimum transportation costs. By using some or all the above methods, you can reduce your logistics cost significantly.
