Due to the volatility of the current business climate, logistics operations are looking for ways to reduce expenses to ensure stability through the COVID-19 pandemic.
As we have seen, during a global supply chain interruption some industries grind to a halt while others become overburdened. But no matter on which side your business lies, cutting costs could be the difference between merely surviving and thriving. Remember, lowering expenses has a two-pronged benefit: it increases profit margin while providing more capital to re-invest in the cusses of your company.
Below are four suggestions to help cut your expenses.
Take Better Routes
Road restrictions, traffic, accidents, and construction all cause dispatchers and logistics managers headaches. Far too often the people planning routes are not provided with the information they need to get deliveries to their destination on time. Time, after all, is the key.
Instead of looking for the shortest route, look for the best route. The best route is the one that will take the least amount of time to get from location to location. To calculate the best route, include historic and real-time traffic, road restrictions, as well as other hazards. This will allow your drivers to spend less time idling while ensuring that dock times are met.
Consolidate loads
Less-than-load shipping needs to be avoided as much as possible because empty space in a truck means more trips. You can reduce trips by ensuring that all truckloads are filled to capacity. Fewer trips mean less overhead.
While this can be difficult, software is available to assist with loading, including the most convenient order to place items–so that the last of the cargo loaded is the first off the truck.
Reduce fleet size
Reducing your fleet size becomes possible after the aforementioned suggestions are put into place. When your fleet can cover more ground in less time and is able to deliver more in fewer trips, taking assets off the road becomes a possibility. If you don’t already know how much your business is spending per vehicle, calculate it, then subtract it from your operating expenses and see how it affects your bottom line. You’ll probably be pleasantly surprised.
Get digital
If you haven’t already, it’s time to get away from paper. Digitizing your paperwork can sound like a drastic change to some operations, especially for those who have been successful for many years. The benefits, however, far outweigh the effort.
By having digital records you’ll have greater insight into your entire supply chain, be updated of disruptions in real-time, and have far smoother communication with all stakeholders. With the refinement of computerized record-keeping, you’ll undoubtedly discover and change any inefficiencies that may have been costing your business money.
Whether operating during a time of prosperity or a global economic slowdown, reducing expenses is advantageous to any business. By implementing the four suggestions above your company can begin improving your bottom line.
PTV Group can help with all the suggestions listed above. Please contact us today to learn more.