When the COVID-19 pandemic hit in 2020, it revealed that the global economy had some serious supply chain issues that needed to be addressed. The complexities of modern shipping and logistics became apparent to ordinary consumers, not to mention the businesses that were struggling to meet demand during that tense time. That said, the tools used to navigate them are still lesser known.
Enter the concept of a routing guide, which is absolutely crucial to ensure goods are delivered efficiently, cost-effectively, and on time.
The A-Z of Routing Guides: What You Need to Know
What is a routing guide, anyway? And how do routing guides help streamline shipping operations? Here’s everything you need to know.
Defining a Routing Guide
A routing guide is essentially a set of instructions that determine how goods are shipped. A routing guide typically includes lists of preferred carriers and vendors, preferred modes of transport, packaging instructions, and so on.
The Role of Routing Guides in Streamlining Operations
The purpose of a routing guide is to streamline shipping operations by minimizing transportation costs, improving delivery times, and ensuring compliance with regulations. When all parties involved have a central reference point to rely on, errors are reduced and efficiency increased, which leads to a smoother shipping process.
Key Components of a Routing Guide
A typical routing guide consists of various different components, which can be grouped into four main categories. They are as follows.
Carrier Selection Criteria
Routing guides specify criteria for selecting carriers based on various factors. They set a performance standard for carriers, help find the best transportation rates, and ensure that all necessary shipping destinations within specified regions are covered.
Shipping Instructions and Procedures
Routing guides also contain shipping instructions, from packaging requirements to labeling procedures that outline how shipments should be marked, and billing procedures to determine invoicing methods.
Routing Instructions
A routing guide also provides instructions for selecting the most appropriate shipping routes for different regions, which can include shipping modes and preferred carriers.
Compliance and Penalties
Routing guides also contain information about compliance. For example, compliance with regulatory standards in certain areas, or hazmat regulations. Possible penalties for non-compliance are included as well.
Benefits of Implementing a Routing Guide
By now, you should have a pretty good idea of what a routing guide is, and knowing what the key components of one certainly helps, but here are some key benefits you need to keep in mind.
Cost Savings
Routing guides contain information that can help assess route effectiveness and eliminate any extra shipping costs. They also help reduce costs significantly by optimizing carrier selection based on negotiated rates, shipment weight, and dimensions.
Efficiency and Reliability
A routing guide improves operational efficiency by structuring and automating the shipping process. This saves time and results in faster order fulfillment, increasing the reliability of deliveries.
Compliance and Reduced Risks
Routing guides play a key role in ensuring compliance with shipping rules and regulations, which minimizes errors and helps reduce legal and financial risks.
Best Practices for Developing and Using Routing Guides
What is a routing guide good for if it's not properly developed and optimized? Here are some best practices to consider when developing and using routing guides.
Collaboration with Carriers
Working closely with carriers lets you gain valuable insights into their capabilities, which allows you to tailor your routing guide for maximum efficiency.
Regular Updates
Routing guides need to be updated and optimized regularly to reflect changes in shipping regulations, carrier capabilities, and business needs.
Training and Communication
Both carriers and vendors need to understand your routing guide's contents and receive regular updates when changes take place.
How Lojistic Can Help
When your livelihood depends on goods being delivered on time and in line with customer expectations, you don't want to leave anything to chance. That’s where Lojistic comes in—an innovative and modern parcel and freight spend management solution.
Thousands of companies across the United States use Lojistic to streamline operations and reduce shipping costs for a good reason. Or rather, a number of good reasons.
For one, Lojistic offers parcel and freight auditing software solutions that help businesses find invoice errors and recover refunds—the platform can also code and pay your bills. Lojistic also provides shipping reporting, as well as shipping analytics to help you reduce costs and increase efficiency across the board.
Plus, you can use Lojistic for UPS & FedEx contract optimization, or utilize its industry connections in the freight marketplace. Alternatively, you can use the parcel shipping cost comparison feature to see which carrier is doing a better job for your company or take advantage of Lojistic’s discounted group parcel rates.
Enable Maximum Efficiency With Optimized Routing Guides and Automation
A well-optimized routing guide can improve efficiency, increase customer satisfaction and reduce costs significantly. If poorly developed or not followed correctly, it can lead to delays, increased expenses, and even compliance issues.
The bottom line is that it's always a good idea to evaluate your current shipping and routing practices and see where improvements can be made. With Lojistic, you can take your shipping operations to the next level.
Reach out today to see how we can help.
Sources:
Custmodal. WHAT IS A ROUTING GUIDE IN SHIPPING? DO YOU REALLY NEED ONE? https://customodal.com/2020/06/10/what-is-a-routing-guide-in-shipping-do-you-really-need-one/
Breakthrough. Best Practices To Optimize Your Transportation Routing Guide. https://www.breakthroughfuel.com/blog/routing-guide-best-practices-to-optimize-your-supply-chain
Author
Rich Harkey
Rich Harkey
Senior Strategy Manager
As the Senior Strategy Manager at Lojistic, Rich leverages over three decades of expertise to help businesses improve their shipping strategies and reduce costs. With a deep understanding of the requirements of shippers and the operational intricacies of carriers, he excels in everything from optimizing business rules and managing carrier invoices to negotiating carrier contracts.
Rich's comprehensive knowledge of the logistics industry, combined with his strategic insights and passion for data analysis, has enabled thousands of companies to gain visibility into their shipping expenses, driving impactful results.