For the freight world holiday shipping or for shippers in any peak season (such as those who ship plants for the spring time) it gets chaotic, everyone is trying to clear docs, empty warehouses, and get their books in order. Holidays are always difficult to work around in our industry. We lose valuable transit days with shipments when carriers aren’t moving freight. Add to that, the fact that the winter holidays are occurring during the time of year where the weather is already affecting a large portion of the country. So there are multiple obstacles to overcome this time of year. Holiday shipping time also brings customers that ship primarily for this season. They are shipping products specifically geared towards the holidays, so their shipment counts increase exponentially. The closer it gets to the actual holidays themselves, the more urgent a customer’s needs become to ship the product out so it leaves their location in enough time to get to the destination with the missing transit days accounted for. We wanted to bring you some quick strategies and tips that can help your holiday shipping woes or at any time of the year where you experience an increase in shipping volumes.
Truckload Holiday Shipping
Holiday shipping prices for 2015 are pretty similar to what they were last year, only a bit lower thanks to an ease in capacity. The truckload market spiked last year about this time and the prices have gone down some. This isn’t necessarily surprising, so let’s focus on the areas of the country where you CAN look to save some money. Holiday shipping prices going INTO California and heading west are looking good. As the shipping gears begin to grind, the retail industry is filling up trucks moving out of California to the rest of the country. Though rates coming out of California are high, you can get a deal if you’re moving freight back west. It’s important at this time to gather quotes and execute with trusted partners.
Central Freight Holiday Shipping Rates
Another good place to save money on your holiday shipping prices? The east. With all the retail coming out of the west, freight rates in the east are going to be a bit lower due to supply and demand forces at play. However, plan a bit more time as the weather delays that could hit your freight as winter buckles down. Another thing to keep in mind when it comes to holiday shipping for 2014 is the Christmas tree monster. If you’re shipping in Oregon, Washington, or the Carolinas then lanes are at capacity. Why? They’re full up with giant Christmas trees. Consider this if you are shipping into these areas.
Try Creative Forms of Shipping, Utilizing Multiple Modes
The mantra for all transportation professionals is simple and holds true no matter the holidays or peak seasons: reduce costs and increase customer satisfaction levels. However, market forces such as fuel costs and decreased capacity work to undermine these goals. But that doesn’t have to be so this busy holiday shipping season. Core carrier programs and carrier negotiations that once played a fundamental role in shippers’ cost reduction strategies no longer are sufficient. Transportation professionals have begun to realize that negotiating lower rates with carriers is only a first step in an effective transportation management optimization program. To be successful at finding ways to reduce costs while maintaining customer service levels, shippers must utilize creative initiatives that will produce savings and allow them to remain competitive. The best practices presented below represent strategies to optimize freight and in turn, achieve cost savings without reducing service levels to customers. The primary best practices are (read an extended version with graphical explanation here):
- Straight Pooling: Using a pooling strategy does not increase handling costs as it substitutes pool point costs for an LTL carrier’s terminal distribution costs. Transit time should not be impacted in this model. The value that shippers derive results from shifting modes from LTL freight to truckload freight on the initial outbound leg of the shipment. By putting all of the orders on one master bill of lading, an opportunity for cost reduction is created.
- Shipment Aggregation: Aggregation is creating a single shipment of multiple orders, originating from the same shipper to the same destination on the same day that would have otherwise have been released as separate shipments.
- Shipment Consolidation: Shipment Consolidation is an option when multiple LTL orders can be combined with a truckload sized order that is not at full capacity, if they can be part of a stop-off in route to the final truckload destination.
- Continuous Moves: Continuous move solutions allow for minimizing empty miles. To deploy this strategy, individual shipments are combined into legs of a continuous move.
- Cross-dock/Pooling: Many times LTL freight is long-haul in nature due to several network considerations. If we deploy a cross dock network and replace the network where the individual manufacturing plants all ship directly to the customer base at the required frequencies plant orders would be shipped to plant assigned cross-dock facilities. All customer orders from a given plant may now be merged and shipped to a single cross dock, from which we can mode-shift and build truckload shipments. In some cases, it may be more cost efficient to use multi-plant milk runs to drive freight to the assigned cross-dock. Each order can be consigned to a customer assigned pool distribution facility. The cross docks assemble pool orders and ship full truckload to the pool points, where they are distributed to customers via LTL. The objective of this solution is to maximize the distance shipped with lower truckload rates. This is of course subject to customer order transit time requirements and constraints.
Communicate with Carriers and Your 3PL Your Plan, Issues, and Needs
Sound shipper-carrier relationships establish an understanding of what both parties want to achieve. Knowing how to effectively work with your carriers, and realizing the impact of what each of you wishes to achieve, will help deliver tangible and sustainable results for the long-term and in the case of any peak season, works wonders to make sure you have confidence carriers are working with you in your times of most need. However, if you are a shipper who does not have the time and resources to build those relationships, your 3PL can do this on your behalf through a carrier relations management program. Further, besides developing great relationships with your carriers and 3PL partner, you can also communicate your holiday shipping plans and peak season shipping, such as during the holidays, ahead of time. Then a plan using creative forms of shipping or setting the right expectations of deadlines can happen and allow you to have get things going way ahead of time.
Communicate with Customers and Suppliers
On the inbound shipping side, you work with suppliers and vendors. On the outbound shipping side, you are working with your customers. Like with carriers and your 3PL having a solid relationship with these players in your shipping supply chain during the holidays can really pay off. You can place orders ahead of time with suppliers or let them know what your expected needs are going to be so you can arrange shipping way ahead of time. This applies to customers as well. Ask them if they expect an increased volume of orders they need to arrange transportation for. This is an easy tip, but it goes a long way. You don’t have to wait and have a surprise order come through if you reach out and ask way before hand. Further, the more you collaborate with suppliers and customers, the more benefits your realize for continuous improvement such as solving process errors or talking about how the working relationship is going.
Use Technology, like a Transportation Management System
With as many software programs and web-based systems that are out there today, relying on technology to help you process, access documents, and streamline decision making will save you hours upon hours over the long term. If you are already not using a Transportation Management System (TMS) to process shipments and get great analytics from, you should look into the full benefits of a TMS to see how it could help you not just in the holiday shipping season or peak season, but all the time.
3 Quick and Easy Tips to get through The Busy Holiday Shipping Season
- Be Patient : Weather delays affect all areas of holiday shipping, and drivers take time off for the holidays just like the rest of us.
- Get your freight in transit early: If you are a professional procrastinator, you may get the desire to put it off until the last minute, but shipping requires good planning, especially during the holiday shipping season. Everyone needs to ship during the holidays, so don’t get stuck with delays because you decided to send your freight out too late.
- Have a good time: The holidays can be stressful whether it is your personal activities or the surge in extra planning. Be thankful for what you have this holiday season. These times are over before you know it and soon it’ll be January, freezing, with nothing to look forward to until Spring.