Monday, October 20, 2008

Reduce Warehouse Costs

- Some costs are only estimated. Get a better idea of how much money is spent by closely analyzing the cost of freight, duty, brokerage, and carrying. Finding an approximate price can help a business determine if it is worth trading overseas or to think about using domestic resources.

- Some businesses attempt to time their received shipments in order to save money. This can lead to other issues such as making customers wait for their shipment, a lack or surplus of product, and inconsistent records. Determine whether it is worth receiving shipments at consistent intervals regardless of the cost. It may help a business save money overall.

- Watch out for shipments that contain less than a full load. Some suppliers may charge per container. If the supply chain involves several stops before its final destination to a business' warehouse, check to see if consolidating loads from different locations is a possibility in order to save more money.

- Keep excellent records on a daily basis. Inform decision makers of the daily costs regarding shipping and warehouse costs. Letting people know about the data can improve the choices being made on a daily to weekly basis.

- Many businesses get charged carrier's insurance. Most businesses are self-insured, so it is beneficial to see if goods are covered under their own insurance in order to avoid paying the extra carrier cost.

- Express shipping is expensive. This level of shipping is employed when a warehouse is in immediate need of goods. This extra cost can be avoided by closely analyzing company data. A business needs to know how much product is needed on site on a daily basis. Few businesses should be in need of express shipping on a regular basis.

- A warehouse needs to compare the costs of shipping and receiving by land, air, and sea. Depending on times and the bulk of shipment, a business can save money by employing all three modes of transportation.

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