While today’s fast-paced global economy promises rising sales volumes and optimised supply chains, importers and exporters need to maintain control of as many processes as possible. One of the hardest supply chain components to control is freight shipments, but those that can somehow manage them can stay ahead of the competition at a time when speed, efficiency, and customer satisfaction are key.
Technology, fluctuating inflation, and changing consumer purchasing habits have also altered the logistics landscape significantly. Therefore, buyers and suppliers must be more flexible all while exploring innovative strategies to streamline their shipments, where possible.
This article will provide insights to help optimise freight shipments, reduce costs, and enhance customer satisfaction, which will collectively help maintain a competitive edge.
Take Advantage of Technology
Automation and artificial intelligence (AI) are revolutionising the shipping industry, enabling businesses to increase efficiency, reduce manual labour, and improve accuracy. Technology has also helped marine propulsion, with hybrid and electric drivelines proving more readily available.
Key technological solutions to consider for your shipment and operations include automation solutions to streamline workflows and take over routine, admin-heavy tasks like data entry and sorting. With the help of AI-powered analytics and data aggregation, buyers and suppliers can optimise shipping routes and schedules, ensuring that fuel consumption and bottlenecks are reduced. Blockchain technology has the potential to offer secure, centralised, and digitised record transactions, minimising paperwork and fraud risks, while improving and enhancing trust and collaboration between buyers, suppliers, and carriers.
Taking advantage of real-time location systems (RTLS) to provide complete visibility of inventory, orders, and logistics will also prove crucial for those requiring more tech-led warehouse and manufacturing operations.
Optimise Packaging and Warehousing Strategies
Adopting eco-friendly packaging materials and implementing smart warehousing solutions can significantly improve shipping efficiency and help businesses achieve their sustainability goals. Utilising lightweight, recycled, or biodegradable packaging may present slightly higher upfront costs and the possibility of limited material availability, but will help to reduce shipping costs and lessen their impact on the environment.
Integrating cutting-edge warehouse management systems (WMS) with Internet of Things (IoT) devices will allow for real-time inventory monitoring and asset management (as mentioned above). Consider deploying software that can autonomously alert facilities managers to inventory shortages or misplacements, where shipment orders can then be aligned to ensure sufficient stock levels all year-round, thus minimising bottlenecks.
As far as IoT tracking for asset management is concerned, shipments may warrant the use of GPS tracking to ensure complete oversight of movements, while assets in internal facilities can be tracked laterally with the use of RFID, WiFi, Bluetooth Low Energy (BLE) or ultra-wideband (UWB) tracking technologies. Integrating the right trackers with the types of assets needed to keep track of will prove crucial in ensuring shipments of replacements and supplementary products are optimised.
Implement Just-in-Time (JIT) Shipping
Just-in-Time (JIT) shipping strategies aim to minimise inventory levels by delivering goods only when they are needed. This approach can help suppliers reduce warehousing costs and overheads, improve their cash flow and liquidity, and mitigate the risk of stock depletion and lost customer orders.
Buyers can usually pay slightly inflated prices to ensure the timely and safe delivery of urgent stock and provided suppliers can meet shorter timescales, it can facilitate long-term, mutually beneficial importer-exporter relationships. Establishing stronger relationships among buyers and suppliers will also encourage better rates, optimised delivery times, and greater supply chain flexibility.
Furthermore, as businesses expand operations and deliveries worldwide, fostering healthy and sustainable partnerships with international carriers and distribution centres will make their delivery networks more resilient. Familiarisation with geographic and regional regulations and customs requirements will also prove vital.
Disruptions are often unavoidable - perhaps none more exemplary than the COVID-19 pandemic which caused worldwide shipping capacity constraints - but enhancing shipping networks will ensure these are kept to a minimum while making shipments more reliable.
Explore Multimodal Transport
Utilising a combination of transportation modes (e.g., road, rail, sea, and air) can also help businesses optimise their shipping processes. Multimodal transport can reduce costs and increase efficiency all while providing an optimised and inherently more eco-friendly route for shipments and orders. By leveraging different modes of transportation, companies can also navigate potential disruptions with greater control and ensure alternative delivery options to keep supply chains afloat and not completely hindered by large-scale blockages.
Don’t Forget About Compliance and Risk Management
International trade regulations compliance is essential for businesses involved in global shipping. This includes understanding and adhering to import and export rules, tariffs and regional and international customs requirements, particularly the post-Brexit customs rules for EU trade. Failing to understand these can result in delayed or refused shipments, increased costs, and reduced cash flow.
Businesses should also invest in robust compliance management systems and seek expert guidance in international trade to navigate these complex regulations. Fast financing from lenders or regulated FinTechs in the trade space can also facilitate short-term cash flow shortages for suppliers and keep buyers satisfied with flexible invoice payment terms.
Additionally, implementing strong cyber security measures and insurance coverage can help mitigate various risks, such as data breaches, natural disasters, and cargo theft. The cyber threat landscape has grown significantly in recent years, and trade is a high-value area, so being lax on security can affect shipment optimisation and stability.
Prioritise Sustainability and the Environment
As the shipping industry faces growing pressure to reduce its environmental impact, businesses should adopt eco-friendly practices to demonstrate their commitment to sustainability.
Strategies to consider include the aforementioned use of recycled, reusable and biodegradable packaging materials, and optimising shipping routes to reduce fuel consumption and emissions. Furthermore, deploying energy-efficient fleets in-house or partnering with carriers that commit to using electric vehicles and facilities powered by renewable energy will also ensure a much greener - and still optimised - supply chain.
Enhance Customer Experience and Communication
Meeting customer expectations is crucial for business success in today's competitive market, not just in the logistics sector. Offering flexible shipping options, streamlining returns and transparent refund processes, together with actively engaging with customer feedback can help businesses improve overall customer satisfaction.
Many importers and buyers are looking to partner with suppliers that can feasibly offer flexible invoice payment terms, but suppliers can take advantage of invoice factoring solutions to alleviate short-term cash flow shortages while invoices get paid. This can allow them to source new products and fulfil more orders, while buyers can still reap all the benefits of 90+ day payment terms, in some cases. This is just one solution that benefits both parties and intermediaries in a given supply chain.
In the evolving landscape of logistics, businesses must continuously adapt and innovate to optimise their freight shipments. The guidance above provides a template on which buyers and suppliers across UK supply chains can continue to innovate and make their freight shipments as continuous and uninterrupted as possible.
