15 Tips To Optimize Ocean Freight Rates
1. Have a deep knowledge of the business
If there is a fair comprehension of the business and the procedures engaged with it, at that point the costs involved with the shipment, who pays what charges and where costs might be saved will become clear.
2. Know the market and the rates that are common
This is a considerable necessity for the shipper so that they don’t pay more than the market rate to their shipper. Cargo cost bench-marking in the market is a proficient strategy pursued by numerous shippers.
3. Utilize the correct method of shipment to optimize ocean freight rates
For instance, accomplishing the best cargo rates might be gotten by settling on Full container(FCL) or LCL . This is because there are numerous charges engaged with an LCL or groupage shipment as contrasted with FCL. Even within the FCL option, customization maybe accomplish utilizing the right type of container for the right type of cargo – like 20’ container for weight based cargo and 40’container for volume based cargo.
4. Review your quote / invoice
Assure the quotes you got from the shippers are correct and matched with your quotes . There might be situations were the transporter has skipped some shipping surcharges and present in front of you at the time of payment. These could also prove expensive for you as you or your client may not agree to pay extra charges after the business has been completed. Inspecting your quote will help with this issue.
5. Create and Implement
If your freight acquisition depends on a tender, effective creation and execution of tender management process is critical because this is the area where you can diminish your cargo costs related to sea, but also land-side.
6. Effective Plan
Effective strategy clear understanding the scope of business , bulk quantities include and the repetition of shipments allows you to have effective freight negotiations with the carriers. Transporters mostly give best cost to clients who know what they need and able to predict it clearly and this will add to your credibility and reputation with the carrier which is very essential.
This is another choice which carrier support and they may offer discounted price to clients who can triangulate containers. Triangulation mentions to the utilization of a similar container for export and import purpose. Means you export the cargo from A to B and further bring back imports from B to A utilizing same container and same shipper.
8. Don’t incur superfluous charges
Lot many times clients acquire unnecessary charges either at POL or POD because of demurrage or detention which is majorly caused by importers, these charges are so high, the clients might be compelled to abandon their cargo.
9. Customized your route
Route customized is also the another way to lower the cargo cost. Analyse the route used by the several carriers/vendors for the delivery of the cargo and console your self that this is the best optimized route of the cargo. The least expensive quote may not always provide you the overall cost saving that you are trying to accomplish.
10. Customized your cargo packing for Optimizing Ocean Freight
Wastage of space can be dispensed with by using the correct size of containers, boxes, sacks or other bundling material or optimizing the same with the size of the container that will be used for the shipment. Such optimized packing also protects cargo from movement during transit and get rid of damages.
11. Know your terms of sale and shipment
This is a pivotal factor in accomplishing cost saving. You as a client or as a freight forwarder need to realize the Incoterms included, the terms of shipment (CY-CY, CFS-CYetc) and the expenses related with it as these terms help you recognize who pays what charges for a shipment and the responsibility thereof.
12. Don’t classify everything as urgent
Many shippers display this tendency in order to ship /get their cargo delivered at the earliest whether the cargo requires such immediate delivery or not. In a lot of the cases, urgent orders incur very heavy costs. Through cautious; planning and timeline management, these charges may be reduced.
13. Comprehend your rate
What exactly your ocean cargo rates truly include? Is the rate of port-to-port or door to door ? Does it fuse extra charges?
Consolidation shipment provide great flexibility in supply chains and regular, ongoing inventory replenishment. In addition, consolidation supports sustainability efforts.
15. Communicate and work together with your carrier base
Set desires, share prediction and other shipment information and look for extra opportunities.