Many logistics companies spend most of our advertising budget competing with other brokers and carriers. When it come to freight management services, this is misplaced money. The fiercest competitor of a freight management service provider is the company inquiring about the freight management services. The most popular alternative to outside freight management services is managing freight within a given company.
When a company strives to determine whether to outsource its freight management services or keep them in house. The decision makers must ask themselves the following 3 questions.
Outsourcing freight management services might seem counter intuitive at first. After all, people send things from point A to point B in their personal lives all the time: letters and invitations through USPS; gifts and necessities ordered through Amazon.
But don’t make the mistake of letting the easy nature of shipping in your personal life distract you from nuances that could cost you an arm and a leg when you ship goods for your business.
First of all, shipping in the business sense refers to the processes surrounding shipping, in addition to the actual shipping itself. In a word: logistics. In a phrase: freight management services. There’s the pickup and drop-off to coordinate, drivers and trucks to be hired and managed, and crises to be negotiated during traffic accidents or lost or stolen goods.
Even isolated strictly to the issues of shipping, there are plenty of choices to be made. And every time there’s a choice, it’s possible to make the wrong one; these odds are increased exponentially when dealing in a category in which you are not familiar. Take for example different shipping modes: small parcel, less than truckload (LTL), produce, partial truckload, full truck.
Choosing the wrong shipment type can – and does – result in penalties. While seemingly minor in isolation, a $20 penalty or fee quickly becomes $20,000 when it is unknowingly made over the course of 1000 shipments. As anyone running a large business knows, 1000 shipments can be made in seemingly no time at all!
Let’s make a laundry list of all the steps involved in logistics, for any and every company with goods to ship.
Before shipping: inventory, getting quotes, printing shipping labels, entering data for bills of landing, scheduling pickups.
In-transit: monitoring trucks, managing truck drivers, counting goods/boxes at each checkpoint, dealing with inquiries regarding where the goods are.
After delivery: issuing invoices, reviewing and confirming invoice rates, properly coding invoice for records, data entry into accounting system, paying the invoice.
Freight management services are in the business of managing each and every one of these steps on a daily basis, for hundreds or thousands of companies. For an individual company managing its own logistics, it might make more financial sense to employ someone to do the mind-numbing management and data entry associated with each step in the process.
Freight management companies like Prestige Worldwide Logistics can take over each step in the process for you. Using tried-and-true technology for each step in the freight management process, we are able to manage each step for a fraction of the time and money it would take your employees.
Partnerships make life and business both more enjoyable…and often more efficient as well. It is all too easy for people in the office to become pigeonholed in their roles. By operating within your own department, it’s easy to develop tunnel vision in the way you approach problems. Companies that have cross-functional team meetings open the forum to solutions from other departments.
While it is always advisable to invest in internal communications, outsourcing freight management services removes the need for your company to do that where logistics is concerned. Part of the value you’re investing in with a freight management service like Prestige is the knowledge of how to best combine insights from various departments to save money and leverage systems to minimize time and effort expended.
External communications is engaging with your customers to find ways to best collaborate to find where either or both party is operating less-than-efficiently. Then, come up with win-win solutions that allow both companies to enjoy cost and time savings. For example, we’ve realized in several instances that shipping partial truckloads for clients several times a week is not necessary for their customers, because these customers only ship products to their customers once every other week.
Additionally, when our client’s customers receive the boxes full of goods from these less than truckload shipments. They must unpack and break down all the corrugated cardboard boxes before repackaging the goods themselves. Because of our external communication, we now ship a full truckload once a week in a sealed truck. This way, we can leave the goods unpacked and save the customer time and energy breaking down and repackaging goods.
Consider outsourcing freight management services to put our years of experience to work streamlining your logistics processes. Give us a call on (248) 707-1991 or submit an inquiry today to get started!
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