As manufacturers are looking for more ways to save costs on shipping, they are finding that their inbound shipping programs can be better optimised for efficiency which can minimise delays and confusion as well as save them money. Depending on the size of the company and industry, a business can spend more than 40% of its annual freight budget on inbound shipping. By streamlining the process and understanding inbound freight management properly a company can reduce these costs.
Whether your company is a distributor taking shipments of important inventory, an industrial manufacturer receiving inbound shipments of parts to manufacture your goods, or a retailer looking to replenish their stock, inbound freight is a crucial part of your business itself and not just the supply chain. Many businesses do not take control of their inbound freight management because it complex and involves multiple departments in your organisation that sometimes can be put in opposition with each other as well as multiple companies – vendors, carriers, trading partners – and various shipping agreements to understand and analyze.
Why look towards inbound shipping to lower your overall costs?
The results of efficiently managing your inbound freight are substantial when done right, so do not be discouraged by the complicated process involved. Logistics, supply chain and transportation managers in organizations need to champion the cause to get control of inbound freight and ensure the C-level executives in the organization understand the benefits of doing so. Hiring an expert partner with experience in this field will help gain control of this complex issue can be very rewarding.
Some of the numerous advantages of implementing inbound shipping management strategies include securing the best pricing for both at will shipping as well as by applying pre-negotiated carrier contracts to general inbound shipping. Concise tracking of all logistics activities provides more informed shipping account when negotiating new contracts with clients.
Having logistics expertise in freight management services makes certain that business rule development and enforcement is performed by professions able to oversee the process, monitor all aspects of it, execute modifications as the need arises, and recommend long-term changes as the shipping industry and environment change. Consolidating invoices and offering visibility into the true costs of inbound shipping enable businesses to carry out necessary changes in process and reduce overall costs.
To help ease the burden on internal shipping organisations and IT staff, outsource both the technical solutions and the logistics expertise. Employing a service powered by a transportation management system is quick and inexpensive to roll out, requires no new software or hardware and provides access to users company-wide depending on role.
In summary, taking control of your processes, more efficiently managing costs and improving visibility through a managed service empowered by an effective inbound logistics program (through both integrated services and technology) reduces your overall costs and improves operations.
How is Technology Changing the Logistics Industry?
1. Self-Driving Trucks – Tech companies are making driverless trucks a reality with Uber having recently acquired Otto and completed the first autonomous commercial delivery in the U. S. The idea of self-driving vehicles is no longer in the realm of sci-fi; we have the software and hardware available now. The White House estimates that 2.5 million US jobs may be rendered obsolete by trucking automation.
2. Uber for Trucking – This year Uber launched its new service Uber Freight to help reduce excess capacity and make trucking more efficient overall by streamlining the process and minimizing time spend awaiting confirmation and communication. Rapid on-demand delivery combines the convenience of ordering products from anywhere with the immediate product availability of brick and mortar stores.
3. Automation and Robots – Since ecommerce has revolutionized shopping, retailers have needed to employ armies of workers for order picking to be able to get their orders out of the door. The manual picking of orders is not only expensive, but no value is added by having people do this job instead of automation. Amazon already had their own robotics division and they host an annual robotic picking challenge where robots perform tasks of restocking shelves and picking orders. Currently, the speed of automation does not compare to a human doing the same work but with technology rapidly advancing we are probably not too far off.
4. Drone Delivery – The FAA moved quickly to establish aerial drone testing regulations with Amazon, 7-Eleven, Google’s Project Wing and other making commercial drone delivery firsts this year. There may also eventually be ground delivery bots swarming the streets if Starship Technologies has its way.
5 Freight Booking Online – Online freight was limited to US domestic trucking for years until 2016 when online booking finally landed in Europe with a uShip/DB sSchednker partnership. International freight quoting is moving online too, with major progress by enterprise providers and start-ups as partnerships between top tier logistics companies and tech industries are growing,
6. Tracking – International ocean shipping has been devoid of courier-style tracking but that is also changing as MSC and CMA CGM (who collectively own 25% of the global container capacity) both invested in TRAXENS, a global container tracking solution. The founder of a supply chain intelligence company also launched a start-up for global pallet tracking and on the port site, the Port of Los Angeles and GE teamed up to improve uploading and tracking.
7. Customer’s Time – The urgency for fulfillment is speeding up with customers expecting quicker and more efficient service more so now than ever. After owning two day shipping, Amazon launched one hour Prime Now delivery and are creating the potential to drop that hour commitment further still with drone delivery. Walmart started two day ShippingPass program to help compete with the urgency for order fulfillment and Uber launched UberRUSH (a third-party fulfillment program).
8. Augmented Reality – This technology superimposes a computer-generated sensory input such as sound, video, graphics, or GPS data into a user’s real view of the world and is rapidly becoming an important technology bridging the divide between the digital and physical world. Shipping company DHL has piloted AR in Europe and the US, equipping warehouse workers with AR smart glasses that guide them through order picking. This is very beneficial to any worker who is not at a desk and needs hands-free access to information, and is shown to result in higher efficiency, reduced errors, an optimized use of labor and reducing the need for training.
This year Uber launched a new service called Uber Freight that pairs up trucking companies, including independent operators, with loads nearby that need to be transported from one place to another. Drivers are able to log into the app, which still maintains the same look and feel of Uber’s original app, to browse for nearby and available loads, see the distance required for the journey, upfront payments, view all destination information and then simply tap to book. Uber Freight is looking to streamline the communication process by integrating a simple workflow with job confirmation and rates available instantly instead of having to spend hours negotiating conversations.
Another way that Uber Freight is gaining favour and attention is through its quick-payments to small trucking companies and independent drivers. Until now, like many freelancers, truckers have had to wait at least 30 days to receive a payout, while Uber Freight is able to pay drivers “within a few days, fee-free, for every single load.” According to the company, if there are cases where payments don’t go through as quickly as stated, Uber will pay additional fees depending on the wait period.
Uber Freight and Efficiency
So far, reviews of the new service have been mixed with Uber executives claiming that their infiltration of the trucking industry is in full effect and that they already have developed a network of recurring users from a number of large businesses, such as Unilever. Overall, Uber Freight does not stand to revolutionize the trucking industry, but the service will also have far reaching impacts on other areas including supply chain management especially when it comes to expediting goods.
As a result of the manufacturing industry becoming more competitive and consolidated, many companies are moving towards models that guarantee uptime. More customers are renting equipment for a specific number of hours, buying the use of the equipment rather than the actual physical goods, which means that manufactures must be able to meet the promised product uptime. As this is now becoming an important competitive aspect, having the right service parts in the right place at the right time to be able to make repairs quickly is crucial. The use of Uber Freight could help manufacturers ensure that the necessary equipment is on site as quickly as possible, eliminating the time spent coordinating as well as cost concerns that are generally associated with expediting parts for the ‘last mile’. Furthermore, as the on-demand economy becomes the norm and customers have higher expectations than ever, manufacturers will have to adopt these new and innovative ways of doing business in order to stay ahead.
Uber Freight is not likely the last we will hear about Uber’s service ambitions; they have aspirations for eventually becoming a service that offers self-driving trucks and smartphone-based logistics. It will be interesting to see how Uber Freight impacts the trucking industry as it moves forward and gains further popularity among manufacturers. Companies who are able to successfully leverage this new technology to positively impact their end-customer experiences are bound to benefit from the overall efficiency that Uber Freight is bringing to the shipping industry.
North American grocery-retailers have to provide fresh produce all year round to meet demand and with produce’s limited shelf life, delivering goods on time is very important. The products must move quickly through the supply chain as any delay can result in the goods spoiling and revenue being lost. The Food and Agriculture Organization of the United Nations (FAO) estimates that around one-third of the food produced for human consumption worldwide is lost each year in the process of moving food from farms to retail locations for consumption.
Produce has one of the shortest life cycles that exist, and although fruits and vegetables have all different shelf lives after harvest, there is always a heightened sense of urgency when it comes to transporting and distributing these products around the world. The supply chain has to be precise in order to minimize delays and maximize shelf life. In the past, retailers have relied on Wholesalers to handle their produce but more recently large retailers have started to enter into direct relationships with corporations and growers and then using freight forwarders who specialize in and understand produce’s unique shipping requirements to deliver the produce from their country of origin to the retailer’s various distribution centers.
Obstacles with Transporting Produce and How to Overcome Them
Freight forwarders need to ensure that all team members in the shipping process understand their role and are ready to react as delays or damages are costly and can result in the shipments not being accepted at their end destination. Transporting produce has many obstacles that need to be dealt with quickly and efficiently, such as delays at ports, transportation capacity issues and language barriers. Forwarders who have experience with these issues, ports of origin and how common problems affect produce will most often have strategies and relationships in place to avoid and quickly recover from issues.
It is crucial that the forwarder you partner with has relationships along the entire route and it is important to understand all of the touch points throughout the process. When shipping produce, you must decide which shipping methods will best balance transit time and overall cost. It is important to keep track of where the shipment is, and also what temperature it is being kept at, so that in case of rejection the source of the problem can be easily identified.
It is also necessary that your forwarders fully understand the rules and regulations for the USDA, US & Canadian Customs, FDA, and CFIA so that they have the correct information to make all processes flow smoothly. Establishing relationships with senior people within these organizations will help to resolve issues quickly and thoroughly as they arise. Having a state of the art P.O. management system that allows real time communication to the customer is critical to successfully shipping produce. It is very important to have the right logistics management team in place, so that you can save time and money when shipping your produce. Advances in technology and relationships with carriers have evolved the way that retailers obtain and ship their produce to always provide the optimal shelf life.
Ten Tips for Managing Produce Shipments
1. Develop documented standard operating procedures. Ensure that carriers know the rules at a shipping or consignee facility as it reduces detention charges, loading and unloading feeds as well as mistakes in handling freight that has been rejected.
2. Build your inventory of carriers. Identifying multiple carriers and modes of transportation to move produce gives shippers flexibility in pricing which is helpful when cost of fuel rise. Options such as intermodal or carload are more fuel-efficient than truckload.
3. Create a forward inventory. Having a just-in-time delivery networks gives companies the ability to order products today for next day delivery ensuring freshness.
4. Stay on schedule. Consignees and shippers should make carrier appointments to prevent increased wait time on the dock and reduce the risk of the goods being spoiled.
5. Develop a qualified carrier base. Offering full visibility to your shipments, maintaining load security and ensuring that the cold chain is intact throughout the load’s life are crucial. Food traceability and safety are two of the most important challenges so validating your carrier base against strict industry protocols are a top priority.
6. Make yourself an attractive shipper. Always inspect the inside of trailers to make sure that they are clean, dry and odor-free and ensure that your carriers know standard operating procedures, and that your shipping department confirms proper loading temperatures and matches case counts to the original bill of lading.
7. Find the perfect match. It is important to work with carriers who understand your business needs and can fulfill those needs at the right price.
8. Monitor temperatures. Monitor temperatures at the warehouse and make sure the trailer is the right temperature before loading. Make sure that your carrier has the right tools, technology and procedures to monitor, report and adjust temperatures while the produce is in transit.
9. Ship it forward, trace it back. Prepare yourself in advance with the technology to quickly trade the product back to the farm, and even the lot, to save time and money.
10. Deal with issues in a timely manner. Shippers are entitled to due process and to the right of inspection, but they need to process rejections quickly.
With over 34 million residents who have similar interests as US consumers, Canada has become the top export destination of more than thirty-five states. Since entering the North American Free Trade Agreement in 1994, Canada has been USA’s largest trading partner and statistics show that trade with Canada is still growing so expanding into Canada should be a primary objective for all businesses looking to gain more market share.
Of all the freight that passes through the Canada / USA border, 82.2% is done on land by truck, rail and pipeline with trucks making up the majority of that figure. The use of trucks for hauling freight is expected to grow at 4.7% per year, which is much greater than the growth rates of air at 1.7% and rail at 0.7%. Logistics professionals who operate where north meets south have forged a working relationship proving that cross-border cooperation can be a win-win situation.
What are the benefits of shipping to Canada?
U.S. companies should view Canada in both strategic and economic terms. Firstly, the Canadian dollar is extremely favourable to the export market and the United States in general. Cross border trade will grow faster than the overall economy which may experience setbacks. When the US went through a recession the Canadian dollar remained strong, and it opened up a large and eager market for American companies looking for alternative means of selling their goods and services. The Canadian market is far from saturated and both economies are conductive to growth.
Moreover, international shippers can avoid certain fees – such as harbour maintenance fees – by shipping through Canada instead of directly into the US. For example, if a vessel arrives in the Port of Vancouver or Montreal with goods from Asia that are destined for the United States they would be able to avoid the harbour fees because they didn’t come directly into the US via ocean freight. Shippers can also bypass the need to file an Importer Security Filing (ISF) when US bound shipments come through Canada. The ISF filings are mandated by U.S. Customs and Border Protection and are designed to identify high-risk cargo for inspections as it moves.
Another advantage of shipping to Canada is that transit times are generally shorter, with the BC port city of Prince Rupert being the shortest route from Asia to North America. For companies looking for quick and seamless delivery of their goods, shipping through Canada is becoming a more efficient and profitable solution.
Things to Know about Shipping to Canada
Although Canada is the United States’ largest trade partner, there are a few important differences that need to be taken into consideration before deciding to ship to Canada.
Since September 2001, security at the Canada/US border has tightened significantly which makes transit times longer than it used to be. Border wait times are publicly accessible through resources like https://travel.gc.ca/travelling/border-times-us , so being aware of and planning for these potential delays is manageable. The Canadian/US border is the most expansive and stretches across 8,891km of land and water with 119 border crossings throughout.
There are different regulations and compliances when shipping into Canada that you need to be aware of, which is why trusting a third party logistics company who has a dependable and experienced Canadian logistics system in place or partners with one is very important. They will already be aware of all of the differences within the regulations and will have planned for them accordingly. It is also crucial to ensure that your third party logistics company is multi-functional with the ability to quickly and dependably process reverse logistics as around 7% of good shipped are returned. The ability to seamlessly integrate this process will save you both time and money.