Six ways to cut logistics costs
Optimising your logistics processes is one of the most important factors in increasing your profits. In Sargona's blog, we'll talk about six ways you can actually reduce shipping costs and make your business more profitable.
1- Combine shipments
2 Leverage process automation
Let's say you have several shipments of goods from different suppliers that need to be delivered to different customers in the same location. If you send them separately, you will waste more time and money.
What to do:
This approach not only reduces transport costs but also simplifies the logistics process.
What to do:
- It's more profitable to wait a little longer for deliveries from suppliers and send multiple shipments in one truck.
This approach not only reduces transport costs but also simplifies the logistics process.
Managing logistics manually is inefficient and costly. The people who do it aren't working for free. With today's technology, you can hire one person to monitor your entire supply chain in real time.
What to do:
Yes, you'll have to make a one-off investment, but automation makes processes faster and cheaper.
What to do:
- Invest in supply chain management (SCM) systems.
- Buy machines to automatically load and unload containers.
Yes, you'll have to make a one-off investment, but automation makes processes faster and cheaper.
When a truck breaks down, it means delays and extra repair costs. Breakdowns can be avoided by having your vehicles serviced regularly.
What to do:
What to do:
- Establish a preventive maintenance schedule for your fleet. This will help extend the life of your vehicles and reduce downtime.
3. Get your equipment serviced regularly
Sometimes it's more cost-effective to outsource some logistics tasks. Especially if it's international transport or you have a work emergency.
What to do:
This will speed up your company's work and improve the quality of your logistics.
What to do:
- Think in advance about which tasks you would benefit from outsourcing to other transport companies and find reliable partners who can carry them out.
This will speed up your company's work and improve the quality of your logistics.
4- Outsourcing can help
Let's say your vehicle has travelled from point A to point B to deliver a consignment of goods. After the delivery, the vehicles will travel back. Find out in advance which goods can be picked up on the way back so that you don't waste a car. In this way you will complete two tasks and save transport costs and time.
What to do:
What to do:
- Take orders for transport and return.
- Plan routes and destinations in advance.
6. Track logistics performance indicators
5. Route optimisation
Monitoring key performance indicators (KPIs) helps you identify problems and improve your logistics processes. If you don't track them, it's hard to see where you're losing time and money.
What to do:
These steps will help you reduce your logistics costs and make your supply chain management more efficient. Start small and implement changes gradually, and you'll see results.
What to do:
- Identify key performance indicators: shipping costs, bounce rates, delivery times, order fulfilment accuracy, and other metrics that are important to your business.
- Analyse these metrics regularly and use the data to make decisions that benefit you.
These steps will help you reduce your logistics costs and make your supply chain management more efficient. Start small and implement changes gradually, and you'll see results.
