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Business growth relies on process improvement. Cost reduction is key, but customer service cannot suffer due to value engineering. Fortunately, there are ways to minimize costs and improve business results, simply by choosing the right third-parties to align with. In terms of logistics, and especially airfreight, costs can get out of control quickly, so it is essential to have an experienced, reliable ally on your side.
How to Lower Airfreight Costs Without Compromising Customer Service
Airfreight is the fastest and most reliable way to get cargo from point a to point b. That being said, it is also the most expensive way to ship, so it is critical to optimize the process to keep costs low.
Here are our top ten tips to help you minimize airfreight costs and improve service while doing it:
1. Evaluate your lead times
Not every shipment needs to be there “tomorrow.” If you have the luxury of extended lead time, consider using another shipping method.
2. Leverage data
Cost efficiency is a bit of a chess game. It demands that you balance the cost of carrying inventory against the cost of transportation and your customer’s timelines. Having visibility into your systems and the data they generate gives you real-time insights you can leverage to optimize costs.
3. Optimize demand forecasting
Accurate demand forecasting helps logistics managers ensure they have adequate inventory in all the right places. The ability to foresee future needs streamlines processes and maximizes revenue potential.
4. Look for opportunities to pre-position inventory.
Stop doing things at the last minute. Data will help you prepare for seasonal surge, promotions, and any anticipated supply chain challenges. Moving inventory ahead of schedule enables you to avoid unnecessary airfreight expenses.
HOW TO SAVE COST BY SWITCHING YOUR FREIGHT FORWARDER
For supply chain managers, cost efficiency and quality are critical. If your systems and processes are not performing in a way that adds value, it might be time to switch your fright forwarder.
5. Use visualization tools
When you can visualize your supply chain operations, it’s easier to see where certain aspects are breaking down. This allows logistics managers to make proactive adjustments to mitigate short or long-range issues.
6. Align your network to local airport hubs
The less time your cargo has to travel and the closer it is to the airfreight connection, the more time you will have to process and move cargo through your system. Simplify and localize to optimize process efficiency and lower costs.
7. Establish KPIs to assess performance
If you know what your targets are, it is easier to determine whether you are reaching them. Establishing key performance indicators (KPIs) will help keep your budget and operations on track.
8. Minimize border-related delays
Ensure you have all the appropriate paperwork, manifests, customs documents, and so on before you initiate airfreight. Packages must be clearly labeled and accompanied by the right forms to prevent costly delays and reshipments.
9. Optimize packaging efficiency
Consolidate packages to minimize the number of items sent and their related packaging materials. Ensuring each piece is packed appropriately for all modes of shipping will help you avoid breakage and repacking costs.
10. Know what to expect with international vs. domestic shipping
International and cross-border shipping requires a different workflow than domestically shipped cargo. Understanding these needs will help you plan more accurately and minimize lead times.
Do you struggle with keeping airfreight costs down? Let the experts at DTS advise you on how best to accomplish cost and process efficiency throughout your supply chain. Call today to speak to us about your needs.