The way we shop as consumers has changed dramatically over the past ten years. As this continues to evolve, Residential Less Than Truckload (LTL) will continue to grow. If you’ve been afraid to take this leap, you should seriously reconsider to help keep your company competitive.
There are a number of things to educate yourself on when tendering these shipments:
- Fees: There are three common extra fees you will be assessed when you ship LTL to a residence: Liftgate, Residential, and Call for Delivery. The Liftgate fee means they will need to take a truck that has a liftgate that lowers onto the ground. This will allow the heavy shipment to be taken off the truck effciently where typically at a business there is a dock or forklift and this is not required. Call for delivery means exactly that. Since there is no guarantee someone is at their home during the day like a business, the destination terminal has to call to schedule an appointment to ensure the driver will be able to deliver. Finally, there is an overall “residential” fee that is added as well. You need to be cognizant of these extra charges so they don’t come as a surprise to you.
- Technology: If you’re using an ecommerce platform, you may run into some extra work because the process for getting a rate on LTL will vary greatly from small package. You’ll want to make it easy so that your consumer doesn’t abandon their cart. You’ll also need to consider a markup to cover any unforeseen costs that can occur on these special deliveries.
- Educating your consumer: It may be likely that the consumer receiving your product has no idea what LTL even is. It is important to let them know what to expect with this process because it will look and feel much different than a parcel delivery. They’ll need to know that they will be called for an appointment as well as check for damage before they sign for the shipment. This will help protect you should you need to file a damage claim.
Finally, there are a number of last mile options you’ll want to explore. Some carriers are more open to residential deliveries than others. A lot have invested heavily in smaller trucks to do just that, and you’ll want to make sure you choose the best fit for your business. White glove service is another choice to consider that provides inside delivery options as well as debris removal. You will also need to think about residential returns which will add another layer of complexity.
If you’d like to talk to experts that can answer questions about the charges, technology options for quick quoting that don’t require a call, or how to convey the message to your end user, we would be happy to help. You can count on our hundreds of years of combined experience to provide you with solutions that can help keep you on the front line and focused on your core business.
Based on research, there are a lot of changes US manufacturers will need to make to stay on top in their respective industries and continue to compete in a global market in 2018 and beyond. The innovators will edge out the competition and continue to succeed. Your shipping spend is a bellwether tied directly to your company’s success and it oftentimes gets overlooked.
Here are some of the most important things to consider when looking at shipping in the manufacturing environment:
- Cutting-edge technology:
Data is king. Without access to your data, you simply “don’t know what you don’t know.” How am I trending? What did my shipping spend look like last year at this time? Where are the outliers? These along with many more questions are something manufacturers should have answers to at their fingertips. If you don’t, you’re not maximizing your opportunities and finding savings that you would be missing otherwise.
- Spend management:
Ongoing monitoring is required in the freight world to make sure your spending doesn’t spiral out of control. Carriers take increases, and that is a fact that won’t change. The question lies in what is being done to manage that process. Are there monitors in place that can offset those inevitable increases? Are there other options being considered if they cannot be offset within reason? These questions are vital to maximizing your shipping budget.
- Process improvement:
We all know the definition of insanity is doing the same thing over and expecting different results. It’s not uncommon that a lot of key elements that can be streamlined go unnoticed. How is the order management process tied into freight, or is it? How are the thousands of freight bills being managed? What systems are in place to allow the shipping department to move freight? Are there still manual and laborious processes that can be improved upon? There are soft savings associated with each process improvement and every one should be explored.
As we head into 2018, these are all important things for manufacturers to consider to help them stay at the forefront. Ultimately it comes down to three things that need to come together: people, processes, and technology.
If you’d like to talk to experts that can provide guidance, FreightWise is here to help. You can count on our hundreds of years of combined experience to provide you with solutions that can help keep you on the front line and focused on your core business.
Freight pricing gets complicated when a business sells products online that weigh over 150 lbs. It gets even more complicated when a combination of lower weight products on one order gets above 150 lbs. eCommerce systems simply aren’t ready for complex freight calculations like this. That is where FreightWise comes in. FreightWise is the engine that powers automatic mode selection and optimized cost in Magento eCommerce platforms.
The business model of eCommerce freight pricing is one of basic math. If freight is “free,” it’s really baked into the product price, thus inflating the price that buyers see when they search online. If freight is priced on a matrix and not truly rated (by dimensions or zip codes), then margins aren’t standardized, thus creating cart abandonment on high margin orders and inflating transactions on low margin orders.
Moreover, the absence of mode selection in eCommerce (parcel to LTL to TL) leads to wide-ranging and inaccurate freight pricing. Consequently, this absence leads to companies limiting the products they offer online or simply drives customers away.
“The only true way to ensure that companies can offer any product they want and at any weight or dimension in the eCommerce environment is to rate, to the penny, each mode and offer the best selection to the customer. To solve this problem, we at FreightWise build APIs that support multi-carrier and mode rating for several eCommerce platforms with a recent launch for Magento,” explains Richard Hoehn, CIO of FreightWise. The result of this true cost rating environment is an online experience that allows SMB customers to offer Amazon-like functionality and ease of ordering. Not to mention, it protects and improves online margin with a very easy to prove business case.
At FreightWise, we are thought leaders at online freight optimization. Please call us for a free consulting evaluation of your online quote-to-cash process.