Shipping costs can add up quickly as your business grows. The more you sell, the more you ship, and the more you pay. With that in mind, it’s always good to look for anything that can improve your shipping processes. Consolidated shipping offers businesses a way to reduce costs, improve environmental efforts, and provide a better customer experience.
Here's what you need to know about consolidated shipping.
Consolidated freight shipping is a simple logistics concept that sees several LTL (less than truckload) shipments bound for the same location bundled together and delivered by a single form of transportation. So if a shipping company has pallets from multiple vendors, but those pallets are all heading to the same place, those pallets can be consolidated into one shipment and sent out together on a single truck. This saves time, money, and reduces the CO2 required to make those shipments.
Consolidated shipping is a concept that spans back to the early days of maritime shipping. Shippers would be entirely responsible for their cargo, including loading, unloading, and securing it on board the vessel. This would be incredibly time-consuming and often left dangerous conditions for workers on board the ship who would need to navigate cargo areas in storms out at sea.
Consolidated shipping sought to eliminate these problems by handing the responsibility for the cargo to one shipper. They would take in cargo from a variety of shippers and ensure it was transported in a safe and timely manner. The single shipper could organize cargo to their specification, making it possible to transport larger freight loads. This also helped reduce the shipping cost for those selling their goods because they would no longer need to charter their own vessel.
We have already touched upon some of the main benefits of consolidated freight shipping, but let’s take a deeper look at how freight consolidation can help your business.
While it’s nice to feel like the priority, shipping your products with other vendors’ products can save you significant amounts of money. Say your shipment would cost $1000 — splitting that across five vendors would drop your cost down to $200. It’s a simple and obvious choice for any business needing to reduce costs in these tough economic times.
Again, imagine there are five vendors all needing to ship to the same location. That’s five trucks on the road running the same route. That already seems wasteful, but when you factor in the CO2 required for each truck to make that journey, you’re also looking at a large carbon footprint. Consolidated shipping is perfect at a time when customers are looking for companies with strong commitments to sustainability.
Consolidated shipping offers increased security because fewer people, fewer transfers, and fewer vehicles are involved. Your cargo is handled less than it would be with standard shipping, resulting in a lower risk of shipments ending up at the wrong location or going missing. As a bonus, you only have one shipment to track, so you don’t have lots of tracking numbers to keep track of.
Speaking of tracking numbers, your customers will also enjoy a much less complicated shipping process. By consolidating the shipments heading directly to your customers, you can offer an elevated shipping experience that will leave them satisfied and ready to do business with you again. This can also lead to simple, self-service tracking, resulting in fewer customer service tickets.
Consolidated shipping allows you to receive your goods faster than traditional shipping methods. This means you can get started on quality control as soon as the shipment enters your warehouse, lowering the amount of time you might waste with unanticipated quality issues with your products.
Consolidated shipping is not for everyone or every situation. Some businesses may never need to explore this option, as the challenges may outweigh their business needs. Let’s look at some of the common challenges of consolidated freight shipping.
Planning a consolidated shipment is more complex than traditional shipping methods. There’s a significant amount of coordination involved in ensuring each shipment is grouped together correctly and each recipient is looped in.
Given the extra effort involved, some local carriers are reluctant to take on consolidated shipments. This often means you need to look at carriers you may be unfamiliar with. In this case, you need to ensure that the carrier is reliable and you’re being charged fairly.
Consolidated shipping generally takes longer than traditional shipping. This is due to the time it takes to consolidate the shipment and separate it at the destination. There are a few tricks that can speed up the process, but on the whole consolidated shipping doesn’t work for shipments that need to be delivered quickly.
These challenges should factor into the decision to use consolidated shipping or stick with traditional shipping methods. But don’t let these challenges prevent you from exploring consolidated shipping options. Partnering with an experienced shipping and logistics provider can help you easily navigate these challenges.
There are two main types of consolidated shipping.
The first sees multiple small parcel shipments consolidated into a single LTL shipment. This is common when working with small orders that all need to go to the same place.
The second type consolidates multiple LTL shipments into a single FTL shipment. This is what we do at DTS. We understand that smaller businesses rarely have the opportunity to fill an entire truck and want to keep their shipping costs under control. Our job is to provide you with the best possible LTL freight shipping services and volume/partial truckload services without busting your budget. For those shipments that are 6 pallets or more, reach out to us for special pricing!
We don’t just look after your shipment — we like to look after you too. Partnering with DTS means your goods are being managed in safe hands, and your customers have all the tracking information they could ever need. Contact us today to kickstart a partnership with DTS!
Whether you're a company looking to improve one facet of your supply chain, your entire supply chain, or simply looking for a transportation and logistics consultation, we can help.