Effective Ways to Reduce Shipping Costs

While e-commerce might be seeing a surge in the current economy, skyrocketing unemployment rates and unpredictable consumer demand make it difficult to feel stable in any industry. Uncontrollable freight costs have now become another common conundrum for businesses.

Controlling rising freight costs has now become more crucial than ever.

Unless you take the time to research your supply line and make sure you choose the most cost-effective solution, you will always be plagued with exponentially high shipping costs. But your business doesn't have to fall prey to rising shipping costs. Because luckily, there are many easy ways to reduce shipping costs for your business. This comprehensive guide explains how shipping costs are determined and offers some tips for keeping shipping costs down.

Minimise package dimensions with custom packaging

Heavier packages typically have higher shipping costs unless you've opted for flat-rate shipping. If you print labels and ship things from your garage or store, you may want to consider buying a postage scale which will give you a better idea of ​​the weight of each pack and allow you to calculate costs more accurately. In addition to weight, carriers also consider package size when calculating shipping costs. Larger boxes can result in a larger volumetric weight, resulting in higher shipping costs. Some companies charge more depending on the size of the box. If the item is light, there is no reason to pack it in a large container.

To reduce package weight and ultimately reduce shipping costs, you can try creating custom packaging in smaller sizes tailored to your product to optimize your volumetric weight (i.e. make it fit better instead of leaving items cluttered in the box), which essentially costs you for the air in the box).

Reduce the shipping distance

Bringing your products closer to your delivery location saves shipping costs and delivery times. How exactly? Well, the shipping area determines the shipping cost, whereas the zones or regions correspond to the distance between the origin and destination of the package. For example, a package shipped from region 1 to region two will cost less than a package sent to region 5.

While you need restaurant delivery in Melbourne, you can reduce your shipping area by working with a reputable e-commerce fulfilment company or B2B refrigerated transport service with multiple warehouses. The closer the warehouse is to the customer, the more you can reduce your shipping costs.

There are several logistics involved in delivering your product between multiple warehouses. The number of warehouses that are right for you depends on the size of your business and your order volumes. Amazon has hundreds of warehouses nationwide to deliver bulk orders quickly. However, most e-commerce sellers can reduce shipping costs and delivery times with just a few warehouse locations.

Consolidate your freight

Consider consolidating your freight, especially if you have various small shipments to send out at once. You can downsize your products by combining shipments from multiple suppliers or consolidating your goods with other nearby businesses that share the same destination, such as retailers and grocery chains.

In this way, each supplier only pays for their share of the altogether less-expensive shipment, and your company saves money along with other businesses involved. In addition, retailers can also get to receive their shipments on time with the same volume of goods in fewer, fuller loads.

Shipping small items with high frequency can also be beneficial for your business. For example, it is more expensive to send two batches or bulks every two days than to ship multiple sets at once.

You can reduce these costs by encouraging customers to buy products in bulk instead of ordering smaller shipments in a shorter time frame. You may need to promote bulk orders to convince customers to buy more freight than they need, such as a discount or free shipping on a certain quantity.

Negotiate shipping rates

If you want to lower your shipping costs, one of the best ways is to negotiate shipping costs with your carrier. It may seem daunting, but negotiating shipping costs is relatively easy once you know what to do and say.

The first step in reducing freight costs is understanding what freight costs really are. Familiarise yourself with the current shipping rates, including the base rate and surcharges or surcharges. This will give you a base when negotiating with your carrier. When you're ready to negotiate shipping rates, it's important to know exactly what you want. Need a lower base rate? Are there specific surcharges you'd like to waive or reduce? Having a clear idea of ​​what you want to achieve makes the negotiation process much more manageable.

It's also important to remember that carriers are just doing their job. They are not going to help you lower your shipping costs. They want to make a profit for their company. Therefore, it is essential to be professional when negotiating with them.

Finally, having a backup plan is always a good idea. If the airline you're dealing with doesn't try to meet your needs, be prepared to walk away from the deal. There are many other carriers out there, so don't be afraid to do some research until you find one that's better suited to your business.

Reconsider your storage inventory

If your business ships in bulk, you probably need to store significant inventory. Depending on the exact products involved and how they are stored, various logistical challenges and unavoidable costs can arise. Suppose you need to store products that require refrigeration. Cooling costs extra money, whether you're paying for cold room services near you or paying for electricity to cool your building.

Reducing these costs as much as possible will allow you to easily reduce the cost of your entire shipping process, from start to finish. While most of your items are shipped directly from A to B, they often need to be stocked first.

With price comparison sites, it's easy to ensure you're getting the best deal on every component - premises, security, and electricity. For example, using Utility Bidder and its free price comparison tool, you can compare electricity prices for online businesses. Identifying opportunities to reduce costs at various points in your supply chain will become more critical as your business grows.

Finally, work with a refrigerated logistics expert

The best way to reduce freight costs for your business is to hire a professional refrigerated transport service to minimise costs and maximise productivity.

Many goods will spoil, become worthless, or be damaged beyond repair if they are not transported in a refrigeration system. One of the reasons refrigerated shipping is so vital to the modern economy is that it accommodates so many different types of goods and products. The range of goods includes perishable goods like meat, dairy, medical, chemical, pharmaceutical or even beauty products that require temperature-sensitive settings to maintain their value.

Refrigerated logistics specialists take over the company's logistics processes involving freight forwarding, distribution and storage. These companies coordinate, plan, execute and manage how products move from A to B with maximum efficiency, so you don't have to.

Logistics management enables companies to reduce overhead costs by reducing freight costs, obtaining the best possible shipping rates, and selecting truck drivers based on their transport needs. Expert refrigerated transport companies help transport anything from cars to refrigerated goods, lawnmowers to general merchandise, whether by land or sea, creating a bespoke freight transportation solution to suit your needs.