When you are running a business, you need to do everything possible to keep costs down. A lot of little costs can add up, so you need to track them carefully. Transportation costs are some of the most overlooked expenses for most business owners.
Here are some cost-saving strategies you need to keep in mind.
Always Compare Leasing Options
Leasing a vehicle often makes a lot more sense than buying one. You don’t have to worry as much about annual depreciation and maintenance requirements. As long as your leasing company allows you to drive as much as you need, leasing is often the best possible option.
However, some leasing companies overcharge their customers by hundreds of dollars a year per car. If you need to lease multiple vehicles, these costs can add up quickly. You should always compare prices before signing a leasing agreement.
Incorporate an Automated Planning System into Your Supply-Chain Management Strategy
Are you still manually planning your drivers’ routes? Are you encouraging them to find the best routs on their own?
You may be putting a lot of unnecessary mileage on your vehicles, wasting gas and paying unnecessary man-hours if they are taking inefficient trips. You should look into using an automated planning solution instead. PwC points out that automated planning is the future of transportation. These solutions can help you save a lot of money by finding the most efficient route possible.
They are especially important if your drivers have to take very long trips. If your drivers need to drive across state lines on a regular basis, you could potentially save thousands of dollars a year by using these automated planning systems.
Train Your Supply-Chain Team on Fuel Efficient Driving Strategies
There are a lot of ways that people can drive better to save on fuel. These include:
- Avoiding using the breaks as much as possible.
- Choosing routes that don’t require left-hand turns.
- Maintaining a constant speed as much as possible. Using cruise control is a good way to keep your vehicle steady, especially on major highways.
These tips can also help you save money on brake repairs and other expenditures.
Consolidate Shipments and Event-Planning
You don’t want to make a special trip for every event or delivery. It is better to try to consolidate things as much as you possibly can.
You can cut your travel expenditures by 60% or more by combining trips. If you are a B2B company, it is a good idea to schedule trips so you can deliver to multiple customers in the same region at the same time. You can follow the same strategy as a B2C company, but it might be more difficult if you have to keep track of a lot of different customers.
Hold Virtual Meetings
Businesses spend a lot of money traveling for meetings every year. In the 21st Century, many of these trips are no longer needed. You should consider holding meetings.
Use Drop-Shipping Solutions
If you are spending too much money transporting goods to your customers, you may want to look into a drop-shipping company instead. These companies transport products in volume, so the marginal shipping cost is much lower. They also know how to save on travel costs better than you do.
Cutting Transportation Costs is Crucial
Transportation costs can eat a whole in your revenue if you aren’t careful. You need to look into new ways to cut transportation costs as much as possible. Following these tips can improve your profit margin by 10% or more every year.