When booking a shipment, it makes sense to assume that two-day air would be the best choice to get a package where you need it in two days. And the carriers are probably happy that overnight air would be your first choice! But, depending on what zone you’re shipping to/from, other, cheaper options may be available to get your shipment where you need it, when you need it.
In certain cases, your shipment can ship ground with the same time-in-transit guarantee, for much cheaper. Let’s learn how by reviewing this handy example:
Dave owns and operates an e-commerce business headquartered in Los Angeles, CA. Dave’s company ships a lot of stuff. One of Dave’s regular customers (located in San Francisco, CA) needs a shipment in two days. So by default, Dave’s shipping staff selects next two-day express air as the service level. The shipment arrives on time. Unfortunately for Dave, this shipment cost a fortune. What Dave's shipping staff didn't know is that since San Francisco is in the same zone as Dave, this shipment could have gotten to his customer, on time, for much cheaper via a ground service.
Now obviously this example won’t fit every shipper’s situation, but it definitely illustrates the potential for service level optimization that might be present in a number of shippers around the country. When analyzing your particular shipping situation, be sure to take into consideration:
- Be sure to understand how delivery guarantees apply to deferred services
- The most savvy shippers shop dates, not service levels (service level optimization)
- Use ground services when the time-in-transit guarantee is the same as air services
- Establish company-wide transportation purchasing controls
Huge saving opportunities may lie within your transportation operations; you just might have to do some digging to uncover them. Here’s a couple key take-aways to help you actualize the potential savings within:
- Create detailed routing guides in support of your shipping policies
- Leverage shipping and or TMS to automate and enforce these policies
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.