6 Ways to Reduce Your Logistics Costs

6 Ways to Reduce Your Logistics Costs

Posted on March 31, 2016

Logistics is an important aspect for any business which needs to transport goods and materials on a daily basis. The dearth of efficient logistics services can not only affect the performance of your overall business, but also result in a loss of clients. However, one of the most common problems that businesses often suffer from is the high cost of logistics services. In many cases, business profits can’t stay up with expenditure, a large chunk of which is spent on logistics.

Here are some effective tips to reduce overall logistics costs and enhance business profitability:

  1. Lay Emphasis on Labor Costs

    A profound analysis of the exact labor requirements and how it matches up to the currently hired labor workers is vital for any business. Labor costs contribute heavily towards an increase in overall expenditure and thus, every business should work on reducing these costs by hiring only the required number of people. By offering incentives and higher payouts, the labor staff can be motivated to deliver better performance as well. Also, there are several labor management software systems available that help in efficient management of labor. By reducing the cost of labor, you can cut down your logistics cost considerably.

  2. Ensure Preventive Maintenance

    In order to be able to save money on any equipment, it is important that you maintain it properly by indulging in preventive maintenance. Equipment breakdowns at any point of time can prove to be a costly affair as it not only necessitates new equipment purchase but also halts operations. Thus, always indulge in preventive maintenance of your logistics equipment for better operational control.

  3. Fleet Utilization is the Way Forward

    Better truck utilization helps in decreasing freight related costs for both FTL (Full Truck Load) and LTL (Less Than Truck Load) shipments. You can also improve your packaging to reduce the size and weight of each box, thereby ensuring more goods can be transported in a single truck. Also ensure all trucks are serviced properly in order to reduce the chance of sudden breakdowns. Finally, invest in bunk heaters, cooling systems, etc. to reduce the time spent by truck drivers idling.

  4. Emphasize on Developing Organized Operations

    By using dedicated logistics based operation management software and by developing the strategies for carrying out organized operations, you can significantly reduce the costs associated with logistics. By improving labour efficiency, inventory accuracy, and optimum asset utilization, every business can perform organized operations.

  5. Perform Supplier Optimization

    By collaborating and partnering with suppliers, any business can reduce logistics and supply chain costs to a greater extent. Also, plan your purchases efficiently, as it can help you buy the goods in bulk quantities which come at a cheaper price. It also helps in saving transportation costs related to fuels, as well as reduces overall transportation wear & tear.

  6. Use the Latest Technology and Tools

    Today, there is no dearth of efficient warehouse management, inventory management, supply chain management, and logistics management software and apps. Using these tools, you can save a significant amount of cost, while efficaciously planning operations and executing them flawlessly.

Even after following the above tips, often times you might find it difficult to focus on your core operations while trying to optimize your logistics processes in order to reduce the costs. If so, then feel free to contact us at Flatworld Solutions. We offer highly efficient and cost-effective logistics services to our clients and support them with highly optimized supply chain & logistics operations. You can also share your logistics requirements by leaving a comment using the box below and our executives will contact you.

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7 thoughts on “6 Ways to Reduce Your Logistics Costs

  1. Bernard Clyde

    It’s true that logistics play a big role in a business that has specific transport needs, like you said. Whatever those needs are, I think it’s important that you find the most efficient method to save time and resources. In the end, this will save you money. You mentioned that it’s important to use the latest technology, which I think is wise to help with efficiency.

  2. jessica

    Right now there are many automation tools along with #IoT, which would help you to save your warehouse cost, thus reducing the overall logistics costs.

  3. Supply chain management solutions

    Cost reduction in logistics highly depends upon the strategy designing but Also, many business leaders are cutting cost in their logistics process with the help of 3pl providers, which is also a good solution.

  4. Mariah Seagle

    My brother has a trucking company and they needed it to have it managed properly. It was mentioned that logistics can help ensure preventive maintenance. Moreover, it’s best to hire professional logistics company.

  5. Kamal Dogra

    This is truly awesome post to discover innovative ways to reduce logistics cost. With the advancement of technology logistic system has become much more transparent.


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