2020 was a rough year for everyone but particularly for businesses. Almost all companies reported a substantial loss of income for the year, with a reduced cashflow many businesses have had to cut costs wherever possible to stay afloat. If your company has been in the red more than the black lately, you need to consider innovation ways to reduce your costs – the easiest place to start is by reducing your organisation’s transport costs. Here are 10 excellent ways to do that:
1. Get Creative
Ask any successful business owner and they’ll happily tell you – there is no one-size-fits-all in business. You must find what works the best for your own business and its unique needs. In order to cut costs without compromising service delivery, it is important to become more flexible and adaptable regarding your transport modes. Look at exploring different modes of transport, just make sure you do your homework – some transport options are more expensive but the time they save your business could help you cut significant costs from your overall transport bill.
2. Consider Warehousing Services
If you do lot of long-distance shipping, you should consider warehousing your products. Storing products closer to your customers could drastically reduce your overall transport costs. Be sure to understand that with this option there are many security considerations to take into account. The warehousing option will have its own set of overheads and costs to factor in, so make sure you research this option thoroughly in order to make your decision and to remain proactive.
3. Embrace Technology
Technology is almost always a great addition to any company in practically every industry. Implementing technologically advanced systems can significantly lower your transport costs over time. This will mean an initial investment, which could be very large, but once everything is up and running you will soon see the savings rolling in. Implementing automatic container loading and unloading systems can help to avoid product damages as well as save on production costs.
4. Implement Preventative Maintenance
Properly maintaining your fleet and equipment will go a very long way in reducing the overall transport costs of your company. Only doing emergency or breakdown work can negatively impact your service, your fleet as well as your delivery schedule. You need to analyse your business’s current preventative maintenance policies and make sure that everything is in order. This is the best way to do an audit and make sure your equipment and trucks are being properly maintained, before it is too late, and the costs pile up.
5. Don’t Skimp on Your Fleet
It is possible to buy second-hand trucks, but it is a much more involved and delicate process. Find an international dealer you can trust to buy a new fleet from and they will give you the best advice on how to upgrade your current fleet or to buy a whole new fleet. Keep your budget in mind when buying your fleet – focus on what kind of travel each truck will be expected to do. Once you know what you need them for then you can invest money in getting them. New trucks will run better, they also make use of newer technology which makes for a safer trip for your drivers. Overtime, these expenses will result in major savings for your company.
6. Shared Truckload Shipping
Shared truckload shipping is a freight mode that allows several shippers to share trailer space in one full truckload. This is a better option for some companies who may not have a full truckload to send. A full truckload is a freight mode in which one truck moves loads from a single shipper only. Being able to share a load with other shippers can significantly cut back on your overall transport costs by allowing multiple shippers to absorb the transport costs of their loads, rather than just paying for the entire trip themselves. This transport option can only work if your loads aren’t that big and they’re also not time sensitive deliveries. Do some research on shared truckload shipping in your area to find out how often trips are made and to where.
7. Optimize Your Routes
Bad routes can slow down your entire operation. Make sure your teams take the time to check their route plans and make sure they’re taking advantage of all the perks of technology. Routes planned using pen and paper are not only outdated, they could also prove to be a major waste of time. Your drivers need to spend the least amount of time stuck in traffic and more time on the open road. Being stuck in traffic jams not only negatively impacts on your delivery schedule but it also greatly increases the fuel usage of that truck. Make sure your company always implements 100% accurate and well-optimized routes in order to avoid unnecessary expenditure and wear and tear, this can be achieved by using a route optimizer.
8. Educate Your Drivers
Let your drivers and field reps know that you’re implementing cost-saving initiatives, then encourage them to submit a few ideas of their own to further this cause. You would be surprised at what they can come with if you would just give them a fair chance. You could also consider implementing a reward system for fuel-efficient driving, which will incentivise your drivers into trying to keep the expenses down.
9. Focus on Reducing Failed Deliveries
Every failed delivery costs your company money. Over time, all these failed deliveries could end up costing your company millions of dollars. This isn’t just something that you can control on your own, your drivers could arrive in time for a delivery but if your customer isn’t there to accept the delivery then it is an entirely wasted trip. The easiest way to reduce failed deliveries is by allowing your customers to choose their preferred delivery windows.
10. Be Open-Minded
These are tough and crazy times to be living in, you need to make sure your business, and every department in it, is adaptive and open to embracing new ideas. What worked in the past won’t necessarily work in this version of our future. Your business needs to evolve in order to grow, that means out with some of the old ways and embracing some new ones at the same time.
