Business

Top 4 Ways to Lower the Ocean Freight Rates

For businesses that ship goods internationally, shipping cost is one of the most important factors. As shipping cost is dynamic and fluctuates all the time, it’s impossible to reduce the shipping costs without any proper planning. For businesses that are inventory intensive, shipping costs play a major role in determining their profitability.

However, lowering the shipping costs isn’t extremely hard. Many business owners know how to reduce their freight shipping costs properly. This way they maintain the profitability of their business. Some tips will help you to overcome the unpredictable nature of shipping costs. Here are the top 4 ways you need to follow to reduce your freight shipping costs.

Consolidated Shipments

Shipping goods in bulk is always cheaper than shipping them in smaller consignments. When you ship your goods in bulk, you’ll undoubtedly get a massive discount as it helps the carrier to load the containers quickly and efficiently. Additionally, the unloading process also becomes much quicker.

However, keep in mind that consolidated shipments reflect inventory as well as massive inventory costs. But, these prices are lower compared to the costs of frequent shipping of goods in smaller quantities. You can also use the universal currency converter to know the costs of shipping large numbers of goods.

Scheduling Shipments

Many business owners unnecessarily ship their goods in urgent to achieve speedy delivery. Unless you ship perishable goods, this is nothing but a waste of money. If you approach a company for rushed or urgent order, they will undoubtedly charge you extra. But this can be avoided with proper planning.

Another factor business owners need to remember is that the costs of freight shipment stay lower on the off-peak days. Your business will be able to save thousands of dollars if you manage to leverage this factor. Apart from that, you can further lower the cost of shipping by exploring all the options for backhaul shipping. Considering all these details will save significant costs during the freight shipment.

Automate Invoice Reconciliation

Expert studies proved that the processing of invoices can cost around $6 to $12 per invoice. If you add this amount to your sheer volume of invoice processing, you’ll realize how costly the invoice-making process is.

Apart from that, the process is also time-consuming, mundane, and prone to multiple errors that can damage the cash flow of your business. Not only overpayment, but it can also cause lost productivity and duplicate payments.

The greatest way to increase productivity and save costs is by adopting automate invoice reconciliation. This way you can enhance seamless audits. As per Sps commerce, automated invoice reconciliation is capable of generating invoices electronically and automatically.

Understand Your Rate

It’s extremely important to check all the freight rates that the shipment is covering. Whether the freight rate is door-to-door or port-to-port, you need to check everything including the surcharges. Additionally, before you sign a deal with the freight service company, make sure you ask all the payment-related questions as well as the matter of hidden fees to avoid any problems at the time of payment.

If you ship a large volume of goods with the same freight shipping company, they will undoubtedly provide you massive discounts.

Conclusion

These are the top 4 ways to reduce ocean freight rates. If you want to reduce the freights costs effectively, you need to combine strategic planning with the right technology. Additionally, don’t forget to establish a relationship with the clients and vendors.

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