A guide to saving money on freight shipping for small businesses
The Office for National Statistics has shown that the value of goods imports increased by £3.3 billion (7.1%) in June 2024, with a rise in imports from both EU and non-EU countries -
https://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments/bulletins/uktrade/June2024
With the total value of imports climbing to £857.3 billion -
https://www.gov.uk/government/statistics/uk-trade-in-numbers/uk-trade-in-numbers-web-version (and 4 months left of the year), there’s still a way to go before we see how much UK trade has skyrocketed in 2024.
Freight shipping is one of the unavoidable cost of importing, but it doesn’t have to break the bank. The good news is that with the right strategies, you can turn this cost centre into an area of savings.
Plan shipments in advance
Small businesses can maintain a competitive advantage simply by being prepared. Planning your shipments has a wealth of benefits, some related to cost efficiency and others for keeping customers happy!
Forecasting shipments means you’ll have the correct stock levels, which prevents understocking, overstocking and the chance of delays. Plus, you can avoid the significantly higher costs associated with last-minute orders.
Planning ahead of time also allows shippers to avoid peak shipping times, such as international holidays. By scheduling shipments, small businesses can negotiate more favourable rates whilst steering clear of traffic congestion.
Select the most appropriate shipping method
Small businesses shipping goods have three main options: air, sea, and road freight. Each has its advantages, but which you choose depends on the nature of your goods.
Air freight is the fastest method of shipping.
It’s best for perishable goods that need to reach their destination quickly. However, air transport is less suitable for bulky products. Small businesses transporting large volumes of goods should, instead, choose ocean freight.
Sea freight offers flexible capacity, with options like Full Container Load (FCL) or Less than Container Load (LCL). Despite this, sea freight can often take weeks or months to arrive and its destination.
Small businesses making deliveries within the UK and across Europe can use road freight, which offers convenient offers door-to-door service. While cost-effective for regional logistics, this shipping method can be delayed by traffic congestion.
The delicate balance between cost, speed and capacity can be hard to navigate.
For example, choosing air freight for large, low-value goods could lead to unnecessarily high costs, while opting for sea freight for urgent shipments could cause delays and eventual customer dissatisfaction!
Small businesses can save money by weighing up their options and seeking advice where needed.
Consider freight consolidation
Freight consolidation means combining multiple smaller shipments into a single, larger shipment.
It’s a strategic move that can help small businesses lower their overall transport costs. By grouping smaller consignments, businesses can maximise the use of available space in a container.
When small shipments are combined into one larger shipment, businesses pay only for the space their freight occupies rather than the entire container or truck; this is typically the case with
less-than-container shipping (LCL).
LCL shipping means small businesses can benefit from bulk shipping rates usually reserved for larger shipments (which, when compared to shipping smaller loads separately, can significantly lower costs!)
Optimise packing
The impact of weight and volume on shipping costs can be extensive, particularly for small businesses.
Calculating the chargeable weight of a shipment involves comparing the dimensional weight (also known as the volumetric weight) with the total physical weight of all the parcels in a shipment. The greater of the two is used to calculate payment.
Packaging materials are central to reducing both the actual and dimensional weight of a shipment.
Dimensional weight considers the space a package occupies in addition to its actual weight. If a package is bulky or has a lot of unused space, it will increase the dimensional weight and result in higher costs.
To keep these costs low, consider using packaging that fits snugly around the product.
Disregard the ‘one-size-fits-all approach’ and, instead, have different box sizes for different product dimensions to avoid unnecessary filler materials: these may add weight to the shipment.
Leverage shipping software
In 2024, shipping software is better than ever.
Automated software can handle repetitive tasks like order processing and management without the risks of human error. As such, businesses can avoid the costs associated with incorrect shipments or delayed deliveries.
Small businesses can use these comprehensive dashboards to manage everything from order fulfilment to inventory tracking.
Shipping tools can automate label creation, support batch printing, and offer features such as automated rules for handling different types of shipments. Some software solutions also provide real-time data tracking.
Advanced analytics tools can even help businesses understand shipping patterns so they can best optimise shipping strategies. With a data-driven approach, small businesses can improve their operational efficiency through the supply chain.
Conduct audits
Small businesses could stand to save even more by optimising their operations.
By systematically examining each component of the supply chain, from sourcing raw materials to delivering finished products, businesses can identify areas for improvement.
Audits can reveal inefficiencies in areas such as warehouse management, inventory control, and transportation.
There may be a risk management component, where risks that could disrupt the supply chain are assessed (e.g., geopolitical issues, cybersecurity threats, natural disasters, or supplier non-compliance).
Small businesses could even assess compliance with regulatory standards to avoid penalties. These are just a few methods shippers can use to save on hidden costs, all while building a more resilient supply chain.
Look for discounted supplies
Some larger carriers, such as Royal Mail, UPS, and FedEx, provide free or discounted packaging materials to their business customers.
Royal Mail, for example, offers registered business customers free shipping supplies like labels, ties, and bags, although general packaging items such as corrugated boxes must be purchased.
UPS and FedEx also provide a range of free packaging supplies, such as forms and labels, which can be ordered online or picked up from their locations across the UK. Order with these carriers and reap the benefits of discounted supplies!
Another strategy for cutting supply costs is to purchase packing materials in bulk. Many wholesale suppliers offer discounts on bulk purchases of packing supplies such as boxes, tapes, and bubble wrap.
The per-unit cost of these materials drops substantially when bought in larger quantities, meaning small businesses can save more money over time.
Compare freight courier rates
Comparing courier rates is one of the quickest, most accurate ways to identify the hidden costs of shipping goods. Gone are the days of unexpected fees and tight budgets! We want to help small businesses ship goods affordably.
Conduct a thorough comparison of courier rates today, and Freight Broker can help you save money in the long run. Our convenient service allows you to instantly compare prices from a wide range of couriers.
If you want to streamline your logistics and keep your customers satisfied with timely deliveries (at the best possible prices), work with Freight Broker today.