7 Ways to Reduce Freight Costs

If you are a business owner, you’ll understand that a major portion of business operations includes freight and delivery services. If your freight services aren’t up to the mark, your customers won’t be pleased with your company. This is what makes efficient freight services such a crucial part of a successful business.

However, most freight companies charge a lot of money. In Australia, for example, bulk shipping rates rose by 122% from January 2020 to April 2022. 

If you’re looking for some creative ways to reduce freight costs but also maintain the quality of your shipments, then here are some useful tips.

1. Schedule Them at Off Timings

If it’s possible, try to arrange for shipping at off-timings, such as late in the day or early in the week.  Most companies schedule their freight shipping appointments in the morning or afternoon, which is why the shipping costs are high during those particular times. As for the days of the week, Friday is seen as the most popular choice for collecting shipments from various businesses. 

Ask your freight partner if they reserve lower rates for off-timing shipments to attract cost-conscious businesses. 

2. Find a Consolidation Program

Retail consolidation is also a good plan for business owners who wish to cut down on freight costs. All you have to do is combine all the LTL shipments with similar businesses that are also shipping to the same mass retailers for direct delivery. 

Since many different shipments will be processed together, you have to pay a much lower amount than usual. Even the retailers will get all their goods together.

3. Invest in Better Logistics

One reason why you’re paying a lot of money to freight companies can be because your logistics plan isn’t proper enough. 

Maybe the company that you’ve partnered up with is not using updated tools or software. If you’re looking for a logistics company that’s not only affordable but also highly efficient, then Cario should be your first choice. 

The experienced team there will be able to set up the lowest-cost carrier for you automatically so that you don’t have to worry anymore. 

4. Have a Good Plan

If you plan ahead, it helps your company in many ways, especially when it comes to freight costs. You must develop a robust plan as to which shipments might cost more and why. 

Even though it’s not possible to forecast shipping costs for the entire year with utmost accuracy, it helps to have an approximation. 

Understand the lead times, volume constraints, and all other aspects. And only then can you choose a good shipping partner that will significantly lower your costs.

5. Go for Fixed Rates

In some cases, the variable rates that you pay to your freight partner can actually result in spending more money. 

Fixed-rate costs, on the other hand, are not only much easier to manage but are also consistent and predictable. If you have to pay a fixed amount for every shipment, then you’ll also be able to calculate whether the freight company is charging you a fair rate or not. 

You can also choose to purchase space instead of paying for the cost of the items.

6. Try Out Modal Conversion

Modal conversion is the method of switching a shipment from one mode of transport to another. 

Many business owners feel that modal conversion is expensive and hectic. But in reality, it can help you to cut down your freight costs. 

You can switch from truckload to intermodal or from LTL to truckload. Therefore, if you move from a more-costly to a less-costly option, you will actually save quite a bit of money. 

Small parcels are also seen as an advantage in modal conversion.

7. Minimize Pallet Spaces

Surprisingly, if you pack your items more efficiently and save up more space, it can actually help to reduce freight costs. 

If you can optimize the cube of the product or stack it so as to lessen the pallet spots, your carrier partner will charge you less money. 

For example, try to stack up many small boxes instead of putting a small item in a large box. 

However, different freight carriers have different guidelines on pallet spots. So, make sure you talk with your logistics partner first. 

Over to You

These are a few unique ways in which you can bring down your freight costs quite easily. So don’t wait anymore and try these tips out!

Here are Some Other Articles Related to Your Search:

The Different Types Of Shipping Options And How To Choose

Types of Freight and Logistics services that logistical companies provide

How to Improve the Operational Efficiency of Your Business