For shippers, any best news could start with their buyers putting in new orders and getting their goods rolling. But what if the order is only half their expected or normal amount? And all the leftover space is wasted and yet paid for? It’s common knowledge that the higher the volume, the lower the rate per unit – so the lack of volume caused is not the most effective cost management. So if orders frequently come in with less lead time and volume, how do businesses contest this trend while keeping costs in check?
Time to think freight consolidation
Freight consolidation involves grouping demands. With practice, sets of products, are formed, which, gathered in a larger amount (along with items from other suppliers), are sent for transport. Thus, companies can work collaboratively to decrease the logistical cost. Carriers, organizations, and customers tend to win. However, for the realization and effectiveness of the process, the destination of the loads must be the same.
You know those shopping that people like to do on international sites? As long as freight consolidation is possible, it is feasible to choose items from various suppliers. Otherwise, don’t even think about it. Have you ever thought that the only option was to pay the shipping cost from Turkey to KSA, for example, at each store? Certainly, many businesses would lose customers.
At TruKKer, freight consolidation has been happening since we ramped up our algorithms to club multiple loads onto one in the same or logical vicinity of places. Not only substantial lead time and cost, but we also end up saving millions of CO2 emissions every year, adding to the region’s sustainability goals.
Usually, our carrier network takes responsibility for managing the entire process, collecting materials from all companies, and grouping them into specific stock. And our mobile-native app dots all the drop-off locations along the trade routes, so there is no confusion. The place can be from a container to a shed with enormous dimensions.
Main advantages of the process
To begin, we highlight the financial benefit. When companies get together, this partnership is reflected in documentation and payment. This means that only one invoice (NF) is generated, with the payment being made at once. Consequently, fees that would otherwise be paid to banks are reduced, increasing the carrier’s profit margin. Also, less fuel is spent.
Logistical costs, in general, are reduced. Companies that decide to join in freight consolidation, for example, have the option to pay for the rent of common storage, achieving good conditions. Finally, the final consumer himself greatly benefits from the freedom to buy from several stores and pay a single shipping fee.
About load monitoring, it gets much simpler. After all, it will only be necessary to monitor the trip once, avoiding the dispatch of the products in several deliveries. The simplification extends from issuing all documentation (not just the invoice) to loading and unloading activities.
When it comes to freight consolidation for carriers, bundle means to simplify and streamline. We hope you have understood what the concept means and what benefits it, if practiced, brings. If you want to complement your learning, we would like to recommend other material. Enough of making mistakes, and hunkering down due to ignorance of newer styles – it’s high time businesses adopted different ways to find better ways of winning.