What if you could save million-dollars easily on your logistics costs?
What would this additional million dollars mean to you – more profit, additional office, cost of one VP covered?
So, how and from where do you save that extra money?
A bit of math and some smart decisions can do just that for you.
Here’s the trick…
Compare landed cost instead of Ocean freight for your export shipments. Maybe you knew it, maybe you didn’t. If you didn’t, it’s been one costly slip.
Here’s the math – learn it, use it and save extra million dollars on your logistics.
Over the years, freight forwarders who are responsible for your freight bookings have got smarter. They know you are comparing only freight costs to decide which freight forwarder to award the shipment to.
Hence, they quote rock bottom freight cost, but what they do not tell you is the other hidden costs, such as, the local port charges (THC-Terminal Handling charges, BL charges, Seal Charges, MUC, Toll etc). You get to know of these additional costs only when the final bill reaches you – 40 days after the vessel sailed.
What if there was another freight forwarder who may not have quoted rock bottom freight cost but was really the lowest on landed cost. And, it missed your eyes.
How would this happen?
The local charges of shipping lines vary hugely. For eg., Safmarine charges THC of $90.7 while ZIM charges THC of $125.99. That makes it a difference of USD 40 on each container! All else being equal, who will you give the shipment to – Safmarine with 200 USD freight or ZIM line with 175 USD freight?
How much difference does it make?
In as much as 36.9% of the cases, the vendor with status L1 is not the lowest when evaluated on a landed cost basis. That amounts to 4.19% of the total logistics cost of the company, for a 200 shipment a month volume, this is whopping $1,04,415 lost annually.
Probably you knew this but you never thought it could be this big. The good news is now you know it. And, this year you will save millions on your logistics costs.
Did you say 2 million dollars in your mind? You must be shipping 400 containers a month.
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