INBOUND FREIGHT MANAGEMENT

When shipping inbound, vendors and suppliers often include freight as part of the purchase price at a percentage of the cost of goods. While the percentage varies, it’s always more than the shipping actually costs, making the delivery fees a profit center for vendors. Simply put, if you’re not controlling the cost of your inbound freight, they’re reaping the benefits. By taking control of your shipments and paying the true freight bill, you can immediately save a significant amount in the cost of your capital goods.

Why isn’t every shipper doing this, you ask? When businesses evaluate their priorities, inbound freight management often tends to fall by the wayside. It’s not typically on procurement’s radar because it doesn’t fall into the top 80% of spend, and it can be difficult to know the exact costs associated because there is a lack of visibility into pricing.

But, by getting a better handle on your inbound freight spend, you can remove the waste from prepay and add terms, optimize your spend, and improve freight receiving efficiencies. Gaining visibility into your freight spend is just the beginning. Often, change management also comes into play – especially in larger organizations where, for instance, the inbound product is handled by the procurement department rather than transportation and logistics, or the buying team is resistant to change for fear of missing delivery deadlines.
Human habits and behaviors have a big impact on the freight prices you’re paying, making behavior modification key – and something we’ve advised on countless times for clients. Change can be scary, but the fact is that getting a stronger handle on your inbound freight spend will add money to your bottom line (not to mention, make you look really good at your next performance review).

When we help our customers manage their inbound freight, it’s so much more than that. We view ourselves as part of your team – your transportation department if you will. We seek to go beyond the superficial to drill further into your freight volumes and specific needs in order to optimize and bid relevant shipments and lanes to our network of trusted carriers.

It’s through this approach that we can help you minimize costs, while still getting your goods on time, at market price. Could you benefit from our expertise? See how Tucker helped a Fortune 500 company cut costs by 67% in the first year.
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In our experience, simply switching from a prepay and add freight program removes an excess of 6-16% hidden in the purchased cost of capital (machinery, parts, materials, etc.).

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