If there is one thing all industries have in common, it’s the fact that a previous couple of years have been extremely tough and demanding. Transportation has suffered a lot, especially this year. At the start of the pandemic, people have been panic shopping to the max, thus causing trucking volumes to increase by a third, only to plummet severely. It is only now that it has begun to increase again, but the market has changed dramatically. The modern approach to freight management can bring great benefits to all sides, and we’re going to explain exactly how:
The definition of freight management
Simply put, freight management refers to the process of managing and overseeing the delivery of goods to customers. Regardless of whether we’re talking about a larger or a smaller company, if they are dealing with cargo movement, they have to decide exactly how they’re going to deliver the ordered freight so that it arrives on time at the right address. Not only that, but the company also has to be mindful of the costs involved and aim for them to be as low as possible.
Freight management is essential for shippers
In the transportation process, the company that deals with the orders is called a shipper, even in the case when shippers employ completely unrelated third parties and have them ship their goods to customers. Freight management is an integral part of the complex logistics process. It covers the entire supply chain operation, starting from the warehouse and including supplier relationships as well as inventory control. If your company is a shipping company, you might feel like these processes are overwhelming and demanding. Luckily, you can handle all of them alone or choose to hire a 3PL management provider like General Carrying and outsource some of the more complex ones.
Operations that make up freight management
First of all, you have to select a carrier, and in case you’re using a third-party carrier, you have to do your homework. Do your research, and establish expectations, terms, and rates, and only when you’re familiar with these will you be able to find the right one for your line of work. Another operation is route optimization, where you have to find the most efficient route and select the transport mode or modes. There is also plenty of paperwork, and you’ll be doing a lot of documentation and regulations management. This means that you will have to prepare the necessary paperwork, manage your insurance, and make sure that you’re in compliance with government laws regarding the transportation of goods.
The importance of tracking
You might be a small business owner, or you could work with huge shipments and amounts of money, but you have to be aware of your orders and shipments at all times. Shipment tracking and tracing will ensure that you, as well as your clients and customers, always know when the shipment has been sent and where exactly it is at any point in time. This involves ensuring, on your part, good freight visibility and transparency. Your chosen carrier will usually provide vehicle tracking, but even if that’s not an option, you can choose to track each package or perhaps even a container individually.
How to optimize the shipping process
When it comes to improvement and optimization, you can’t make guesses, even educated ones. You have to have plenty of data to work with. Only when you have access to solid data collections should you start doing analytics and drawing conclusions. Collect all of your data, even if it seems irrelevant at first, because the more information you have available, the better you’ll be able to optimize your business and shipping process. Remember that nothing is set in stone, and many businesses have learned from trial and error rather than getting lucky immediately.
Over the past three years, there has been a significant increase in labor costs, followed by declining freight rates. As if that’s not enough, we’ve seen an increase in demand for faster shipping while orders have been fewer, and carrier margins overall have been higher than ever…Times are strange and have severe effects on operations. With a modern approach to freight management, both retailers and shippers can cut their costs while customers get a better experience and faster delivery.
