Moving Less-than-Truckload freight not just efficiently, but cost-efficiently poses unique challenges to shippers. Although falling gas prices have been a blessing on the transportation industry, LTL shipping still has to contend with the effects of truck driver shortages, higher rates, and congested infrastructure. So how can you save money in LTL shipping?
1. Shift Costs to Consumers
While this won’t apply to everyone involved in LTL shipping, many companies find they can cut costs simply by charging customers more for overnight delivery, or less for longer delivery times. You can even do both at once. Try offering a premium fast delivery option, but lower prices for standard delivery. With longer transit times, you can usually find lower LTL shipping rates.
2. Invest in Third Party Logistics Already
In 2015, there’s no excuse for avoiding transportation software that can help you improve your shipping department. In the 2014 Third Party Logistics Study, data showed that most companies view their shipper-3PL relationship positively. That’s because shippers that invested in 3PL software saw an 11% reduction in logistics costs, a 6% decrease in inventory costs, and reduced their fixed logistics costs by 23%.
3. Optimize Packaging Processes
If you’re a savvy shipper, chances are you’ve already carefully analyzed and optimized your packaging process. Do it again. Even small changes like switching from Styrofoam spacers to bubblewrap (75% cheaper) or electronic postage (3.5% cheaper) can have big savings.
4. Are You Using LTL Freight Brokerage?
During the recession, a number of LTL brokers came into the market to help fill empty trucks and offer struggling companies lower rates. Even now, there are a variety of LTL shipping brokers in the industry who can help secure better rates.
5. Combine Shipments Whenever Possible
Anytime you can combine small shipments into a single large LTL shipment can usually cut shipping costs. Occasionally, LTL shipments might be better consolidated into a full truckload. By combining those small LTL shipments, you can cut down on your total number of LTL shipments and thus save money.
While some of these tips might seem basic for experienced LTL shipping pros, it’s often simple things that lead up to big costs. That’s why an estimated 80% of shippers overpay simply because they don’t compare shipping rates and transit times. Ultimately, if you want to cut LTL shipping costs, then start shipping smarter.