Shipping costs account for a fair share of expenses for businesses shipping internationally. Cost efficiency in logistics is a major source of competitive advantage for your business. Use the tips we provide below to save on shipping costs and improve your bottom line.
1. Pack efficiently
There are several common sense approaches when it comes to packing your goods for export.
● Density: Increase density by eliminating dead space in packages. The price you pay carriers may depend on the volume of your shipment, especially for lighter and bulkier shipments. Make sure to use space efficiently so that you don’t have to pay for volumetric weight.
● Stackability: Make your shipment stackable so you don’t have to pay for the entire space above your shipment. Carriers across all modes of transport charge more for non-stackable shipments because you cannot stack any other cargo on top of it.
● Standard packing: Use industry standard packing (e.g. standard euro pallets 120*80 cm) because they can easily be transloaded across different modes of transport. Besides, it helps to optimize your packing according to carrier requirements. If you can ship your goods in the belly of a passenger aircraft, pack according to the specifications of that particular aircraft type. There is no reason for your cargo to be shipped on cargo aircraft at premium rates.
2. Palletize your cargo
This may at first seem a counterintuitive approach since palletizing your loose boxes adds to the cargo weight and consequently the shipping cost. However, palletizing loose boxes into a single shipping unit has several benefits. It provides protection against potential loss, damage or delay of your cargo in transit, while it is handled through several warehouses and handling points across various modes of transport. When you think about the financial and reputational cost of returning or replacing a lost item for your business, palletizing may not be a bad idea at all.
3. Optimize your shipping schedule
This may at first seem a counterintuitive approach since palletizing your loose boxes adds to the cargo weight and consequently the shipping cost. However, palletizing loose boxes into a single shipping unit has several benefits. It provides protection against potential loss, damage or delay of your cargo in transit, while it is handled through several warehouses and handling points across various modes of transport. When you think about the financial and reputational cost of returning or replacing a lost item for your business, palletizing may not be a bad idea at all.
4. Use express mail for small shipments
If you are shipping small items, usually under 10 kilos, consider using express mail services such as DHL or FedEx. This saves you the trouble of declaring your shipment for customs and paying outsized fees for first / last mile deliveries. Think about the value of your time - is it really worth it? Courier services normally consolidate small packages into big consignments to achieve better price points with airlines, which makes them a better alternative for shipping small parcels.
5. Get your paperwork right
Make sure your export shipping documents are in good order to avoid delays or incurring fines from authorities. If your contract term is DDP, you want to make sure your export paperwork is compliant with the destination country's import customs regulations. At Xscale, our foreign trade teams specialize in drafting documents for import, export and transit shipments, from commercial invoices and packing lists to certificates of origin and permits for special cargo.
6. Avoid miscommunication
When communicating with carriers or freight forwarders about a shipment, be clear and open about all cargo details. Holding back your crucial cargo information such as your insurance needs, special handling requirements or delivery deadlines will hinder your logistics provider’s ability to execute a shipment as required. This may eventually lead to extra costs and surprise outcomes which you can avoid.
7. Choose your forwarder wisely
Having an experienced freight forwarder by your side has various benefits so try to partner with a 3PL provider rather than going it alone when you ship internationally. A qualified logistics provider will not only move your shipment from point A to point B, but also help you optimize your logistics processes in a variety of ways which cannot always be quantified in monetary terms.
Logistics experts can take a holistic view of your supply chain practices and help you optimize your logistics spend by analyzing, identifying and closing the gaps that may be hindering your operations. A-class freight forwarders such as Xscale have a global network and negotiating power with major carriers, enabling them to offer a one-stop solution for all of your logistics needs.
To summarize
With rising inflation, fuel price rises and the ongoing disruption to global supply chains, shipping costs are likely to continue to grow. While you may not have complete control over external cost contributors, taking a few proactive steps can go a long way in optimizing your logistics spend. Take advantage of the products we offer at Xscale to maintain your shipping costs within reasonable boundaries.
About Xscale
Xscale is a logistics and supply chain management company headquartered in Singapore. We operate out of our hubs in Singapore, Tashkent, Frankfurt and London, providing a complete range of logistics and procurement services to businesses around the world. We combine our global network, industry expertise and highly competent professionals to work alongside our customers and solve their supply chain challenges. Contact Us if you require any assistance.