The Right Shipping Supplies and Procedures Reduce Costs and Increase Warehouse Efficiencies

Cut operational costs while increasing efficiency and maintaining quality. Sound familiar? This is a goal we all strive for, no matter the industry. When it comes to reducing operating expenses in a warehouse, it’s a good idea to first examine the operations of the picking, packing and shipping of outbound orders, since this is where over 50% of warehouse resources are used.

Let’s begin with shipping cost reduction. Here are 5 things to carefully consider to help you cut your costs while improving your shipping processes and procedures.  

1. Think Inside the Box: Start with what’s inside your box. When trying to save on shipping, many people overlook the packing materials. Are you using Bubble, Foam or Corrugated? Is what you’re using the best option? Could another method protect your items while being more cost efficient? A lighter option will save you on weight. Packing material that takes up less space will save on package size. Perhaps what you are using needs to be upgraded, but the better protection will ultimately save dollars on the returns caused by damaged goods.

2. Consider Package Size: We touched on this issue above when we discussed how internal packaging can influence size and weight of your package. You should be thinking about both the dimension and weight of what you are shipping. In short, reduce your package size and weight to reduce shipping costs if at all possible. Review dimensional weight shipping rates and see if your package will trigger a higher rate. You may be able to reduce the size of your cartons and realize a considerable savings. Many carriers have weight minimums and oversize penalties, calculated based on package weight and size. Get to know these rules and make necessary adjustments to the cartons’ size and weight to eliminate the extra fees.

3. Determine Fewer Touches: It stands to reason that the fewer times a product is handled, the less the cost of shipping that product will be. If you can streamline your operations by implementing industry best practices to reduce the amount of touches a product goes through between supply and the end customer, you will effectively reduce cost, not only through labor reduction but also because fewer touches means less risk of error and damage.

4. Analyze Processes & Shipping Options: Spend time on analysis of your current processes. How do you ship? Air, Rail, Sea, Truck? Determine which is the most efficient and cost effective method and then get 3 quotes. Furthermore, control how you are shipping. Are shipments being sent out express or expedited that don’t require it? Often times an entire order is sent expedited but actually doesn’t need to be. These costs could be controlled by planning and determining what really needs to be expressed shipped and then send the balance of the inbound or outbound order by rail, freight or standard shipping. Make sure to calculate transit time and how package weight factors in to determine the best shipping method. Include shipping cost considerations when designing your packaging to further reduce the risk of paying more than you need to.

5. Shop Carrier Options:  In 4, we discussed shipping methods, but who you chose as a carrier can also go a long way to saving dollars. Shop around different carriers to find the best rate, transit times and service options. Once you have done your due diligence make sure you negotiate your rate with the chosen carrier. 

The process of shipping is complicated and there are many opportunities to cut costs. A lot has to do with reviewing and improving current processes and procedures. Basic things like your shipping containers and packaging materials can also make a big impact. With some analysis and planning you could be well on your way to saving significant dollars in shipping.

Download our Infographic to help you analyze if you are using the right packaging material inside your containers.