As e-commerce sales continue to grow, shipping remains an indispensable part of business operations. For many small and midsize businesses, this presents both a logistical challenge and a drain on their already limited funds.
The logistics industry can feel like it’s designed for large corporations with big budgets, giving little thought to smaller companies. With effective planning, however, you can compete with the e-commerce giants and reduce shipping expenses — without passing the costs onto customers.
Here are five reasons why your shipping is so expensive and solutions to address them.
5 Reasons SMBs Get Charged More for Shipping
- Your cargo is more likely to get bumped during shipping delays.
- You’re more likely to face sudden delays, meaning more money spent on detention and demurrage fees.
- You have to waste time chasing shipping updates.
- Your packaging is wrong.
- You don’t benefit from the same shipping insurance big corporations use when cargo gets lots or damaged.
Use a Freight Platform That Prioritizes SMBs
Smaller businesses that move less product and have fewer shipments get charged higher rates than larger companies. This is partly due to economies of scale, but it’s also related to networking and contacts.
Big corporations have established relationships with shipping companies and carriers, which enables them to score preferential rates.
Meanwhile, smaller shipments are more likely to be bumped at the last minute, which can leave you with no choice but to pay for a more expensive alternative to avoid disappointing your customers.
One solution is Ship4wd, a digital freight forwarding platform established to prioritize the freight needs of SMBs. Its representatives negotiate with shipping providers on your behalf, bringing you better rates and more favorable conditions than a single small business owner can get alone. Ship4wd is also the only freight forwarder that can guarantee its customers ocean container allocation, regardless of load size.
Receive Real-Time Updates on Your Cargo
All cargo can be held up without warning due to things like extreme weather or port congestion, but these disruptions disproportionately impact SMBs.
When transit is reduced, it’s small businesses that are likely to face sudden delays and cancellations, which mean more money being spent on extra fuel, updating paperwork or costly detention and demurrage fees.
Apart from working with partners like Ship4wd who can fight your corner in these situations, the best way to avoid unexpected delays is to monitor changing conditions in the world of global shipping.
End-to-end shipment tracking solutions such as TrackingMore deliver real-time updates about congestion or disruption in popular shipping routes and busy ports. This way, you’ll know in advance about potential issues that could delay your shipment and can make alternative arrangements.
Invest in Visibility Into the Shipping Process
For smaller businesses, your logistics partners might not keep you updated about the progress of your shipment. Employees have to chase down updates instead of spending time on tasks that drive revenue for your business.
What’s more, the reports you receive aren’t always up-to-date, and the information isn’t always reliable. Working with partners that take customer experience seriously, like ShipBob’s 3PL shipping service, can go some way towards resolving this challenge.
You should also invest in a solution that gives you visibility into the whole shipping process, so you have smooth and easy access to information about your cargo’s journey.
Use Tech to Ensure Your Packaging Is Correct
Packing your products inefficiently could be causing you to lose a significant amount of money.
Shipping items in packaging that’s too heavy, too large or the wrong material can cause you to pay for unnecessary shipping space or weight. On the other hand, insufficient packaging can result in damaged goods and angry customers.
Large companies generally have experienced logistics managers who know how to optimize packing requirements.
SMBs need to find help from a different source. Solutions like Paccurate offer a digital packing solution that identifies the right carton size, shape and material for your fulfillment needs, helping you save money and time.
Get Shipping Insurance Designed for SMBs
Damaged cargo can happen to any shipment, but once again, SMBs suffer disproportionately. Using the wrong type of packaging and having shipments that are deprioritized raises the risk that your cargo might be damaged or lost in transit.
But even the best-packed, fastest-traveling shipment needs effective insurance. Larger corporations often have regular insurance agreements that cover every shipment, but smaller businesses don’t benefit from deals that include insurance and don’t always think to purchase it.
Many freight forwarders offer insurance, but you can also organize it through solutions like InsureShield, a company that’s geared towards allowing you to focus on what matters most: growing your business.
Small Business Owners, Use Smart Solutions
SMBs are used to swallowing high costs in exchange for the assurance that goods will arrive at their destination safely, especially overseas. This doesn’t have to be the case.
Using smart digital solutions and finding the right partners can help you overcome the advantage that your larger competitors enjoy, leveling the playing field and preventing shipping from becoming an obstacle to your business growth.
