Mastering Freight Logistics: A Comprehensive Guide for Sellers

Freight logistics management maximises your firm’s efficiency, improves its bottom line, and helps your business remain competitive and meet customer demands while maintaining profitability in today’s market. However, if your logistics management is subpar, you’ll encounter delivery delays, leading to increased dissatisfaction among customers and unnecessary costs. 

Freight logistics management is no longer a luxury but a necessity for eCommerce businesses to succeed and even champion the export-import of goods. Whether you’re shipping elephant-sized freight, getting stuff from suppliers, or sending goods to customers, you need to be on top of your game.

The biggest benefit of excellent freight logistics management is that it delivers products to their destination promptly and cost-effectively. Thus, if you want to reduce your shipping expenses or streamline your logistics operations, read on to understand various logistics types and discover shipping modes most compatible with different load sizes. 

Understanding Freight Logistics

Freight and logistics might be confused as the same; however, they are quite different. 

Freight means you’re sending out shipments that weigh over 70 Kgs or exceed 30 in. x 30 in. x 30 in dimensions. Shipments or products below this measure are usually considered parcels. 

Contrastingly, logistics is a broader term that highlights how you procure, transport, and store your supplies or stock. 

Freight logistics particularly points out the part where you transport the freight using logistics, like moving heavy/large shipments through different modes, including rail, truck, air, or ocean.

Moreover, freight logistics includes various services like inbound, outbound, and reverse logistics. You can move heavy shipments using any of these services based on the kind of business you have and the multitude of its operations. You must strive to optimise your freight logistics to gain valuable profits, save costs, and satisfy your customers to the umpteenth level. 

Types of Logistics in Freight Management

Let’s look into the three types of freight logistics to understand it better:

1. Inbound logistics

Businesses use inbound logistics when they need to receive supplies, raw materials, or original products that the manufacturing unit will utilise to create the final goods or assemble products that will then be sold to the customers. 

For instance, a big automotive manufacturer requires a set of different parts, such as engines, tires, and electronics, to meet its production target of 50,000 cars for the upcoming quarter. The role of inbound logistics here would be sourcing these parts or raw materials from suppliers, ensuring timely delivery to the production plant, unloading and inventorying the parts, and managing their use to sustain optimal stock levels.

Challenges in the process:

If the business is inexperienced in freight logistics planning or transport management, it can face issues like: 

• Poor visibility into supplier operations
• Increased inbound logistics costs
• Inefficient in-plant operations

There are two legit ways to overcome these obstacles; either a firm can engage a reputable logistics company, like Shiprocket Cargo, to optimise its inbound logistics, or it can have suppliers deal with freight bookings directly.

2. Outbound logistics

Outbound logistics concerns the transport, tracking, and delivery of your products to end customers. It involves everything from order fulfillment, product or freight packing to shipment, delivery of packages and order, or delivery-related customer support services to accomplish it.

An example would explain this better. Let’s suppose a popular eCommerce retailer wants to level up its outbound logistics to meet the increasing customer demand and also aims to improve service standards. However, the retailer is mostly short of the right resources to complete deliveries on time, and the items even go missing at times. As a result, it faces slack from customers or loses them due to delivery delays. 

To rectify these pressing issues, the retailer optimises shipment routing with advanced shipping technology and has a more proactive customer service approach. The resultant benefits would include:

• Quicker deliveries and happier customers
• Fewer order cancellations
• Reduced lost items and delivery failures
• Lower costs for customers and increased cost-efficiency for the business

3. Reverse logistics

You can relate the function of reverse logistics with outbound and inbound freight logistics, as it aims to transport freight efficiently like the other two. But the only difference is that the freight and products’ source and destination are different. Reverse logistics is moving the shipments back from the customer to you. 

The role of outbound logistics finishes once the customer receives the order. However, if they need the product recycled or returned, reverse logistics comes into play. 

Let’s take the example of an electronics retailer here who sells a newsmartphone model to an end customer. Supposedly, after a few weeks of the purchase, the customer sees a malfunction in the device and requests a return. Now, the retailer will use reverse logistics to have the logistics carrier pick up the faulty phone. Then, the phone is assessed for potential repair or recycling, and finally, the retailer processes a refund or sends a replacement to the customer.

Benefits the retailer experiences from using reverse logistics:

• Reducing waste by focusing on reuse, resale, or recycling of returned products
• Improving profit margins by efficiently handling returned goods
• Lowering the brand’s carbon footprint by minimising waste and promoting sustainable initiatives

Common Types of Freight Modes

Let’s move on to the modes of transferring freight between locations. Here are the four common ones, of which you can choose a suitable mode depending upon the kind of goods you ship, their quantity, and if you need a truck to transport them:

1. Full truckload 

A full truckload (TL) means you’ll have a dedicated driver carrying your cargo until the final destination. Opting for this mode allows you to hire a truck exclusively for your use, which can speed up the delivery process. TL is one of the most preferred freight logistic modes among many large and budding enterprises to meet today’s customers’ demand for exceptionally quick delivery. 

The upside of using TL:

• faster delivery with fewer stops 
• pocket-friendly for heavy or large shipments
• less damage rates
• comes at a steeper price than other freight logistic modes

However, a minor downside of TL is that you’ll have to pay the entire amount even if you’re not using the complete truck space for your cargo. 

2. Less than truckload 

Less than truckload (LTL) is the best freight logistic mode for sending shipments that do not use the entire truck space or load capacity. The shipment weight in such cases is usually less than 3400 Kgs, taking up trailer space under 12 ft. 

Freighting companies generally use the LTL freight option to consolidate small shipments and maximise their truckload capacity. The LTL model is where the truck takes several stops at different terminals to unload goods, consolidate them, and then reload the cargo. 

Advantages you get on opting for LTL:

• You pay only for the limited space you acquire in the truck
• It reduces your storage costs as you can transport more shipments

The LTL freight model uses the hub-and-spoke approach, which does have a flipside:

• It might lead to delivery delays, damage, or loss due to frequent halts when compared to full truckloads. 
• There is lower visibility on freight tracking.

3. Partial truckload 

Partial Truckload (PTL) is mid-way between TL and LTL freight. It’s a suitable option when transporting shipments larger than LTL but smaller than TL. Partial truckload usually involves shipments that weigh over 2,200 kgs or require six or more pallets. 

The best part about PTL shipping is that it enables faster transit times compared to LTL as it needs less handling. 

There are more benefits of using PTL, including:

• Being cheaper than TL due to more cost-savings.
• It does not even require a freight class to secure a rate.
• Fewer delay incidents due to less handling required than in LTL freight.

The flipside to this coin is:

• Using PTL generally requires collaborating with brokers. 
• It offers lesser capacity than other modes due to the specific size requirements.
• The visibility is lower during freight tracking.

4. Shared truckload 

Then comes shared truckload (STL), which lets shippers share or divide truck space in a multi-stop and completely optimised TL. It does not require unloading, consolidating, or reloading at multiple terminals. 

Thus, the STL freight, just like full truckload, also stays put on a truck with a designated driver driving the cargo all the way till the final destination. 

Some of the advantages of using STL shipping:

• More on-time deliveries than LTL
• The shipment reaches damage-free 99% of the time
• You only pay for the space you used
• Has better tracking potential

However, STL requires flexible pickup to coordinate the shared loads. It’s one of the downsides of this freight logistics mode.

Choosing the Right Freighting Company

These suggestions will help you pick the best freighting company for your shipping needs: 

Identify Your Shipping Needs

It’s crucial that you first analyse your shipping requirements before you rush to tie up with a shipping partner. You must determine the locations you want to send items to (domestic or international), the type of goods you’ll transport, and how often you will send shipments, i.e., their frequency. 

For instance, if you need to ship perishable items, you must select a freighting company that has required arrangements for such shipments in place. The shipping firms must have temperature-controlled shipment settings for perishable goods.

Check the Freighting Company’s Experience

The expertise and years of experience a shipping company has matters the most. This is one aspect you can’t skip while latching your business with a freighting partner. If the company has a proven track record of successful deliveries over the years, then it’s a credible one. It shows they can handle your shipments proficiently as well. 

Look for the firm’s reviews and references to gauge their expertise level and reputation in the market.

Look For Advanced Shipping Tech

Most large and experienced freighting companies today use state-of-the-art technology to supersede the shipping and delivery expectations of businesses and their end customers.

Therefore, you must find a shipping company that has an advanced tracking facility (like real-time tracking and updates), software or technology to manage documentation, and a user-friendly online platform for businesses to easily track and orchestrate their shipments. 

Find Companies With a Wide Shipping Network

If you deal in international orders, it’s vital for you to choose a freighting company that has an extensive global shipping network, like Shiprocket. This is because the freight forwarding business relies on working with a solid network of carriers and agents. Such organised networks give you the full coverage you require. Thus, ensure your preferred freighting company has a sizable agents-and-carriers network in the areas you ship to. 

Consider the Freighting Company’s Compliance

Compliance in freight forwarding simply refers to following the rules and regulations for international shipping. A dismissal of these regulations can land you in legal trouble or cause uncalled-for delivery delays. 

A freight logistics company that stays up-to-date with any restrictions, policies, and laws pertaining to shipping in different countries knows how to handle customs well. They lead you in the right direction and take care of all such complications on the way. 

Customer Service is Essential 

Customer support capacity of a freighting company is an important aspect to consider when choosing the best one. You’ll need prompt support throughout your shipment journey to resolve any issues during the transit, especially if it’s a long one, like cross-border shipping. 

Thus, choose a shipping firm with dedicated customer support to solve your concerns quickly through various channels like WhatsApp, online chat, IVR, etc.

Compare Rates

Compare the prices, services, and quality you’re getting at that price from different companies. The cheapest may not be the best, which might mean you’re compromising on quality. 

Look for a shipping partner that offers reasonable prices and value-added services, including customs clearance, easy documentation, and insurance. You must also ensure there are no hidden charges before signing up with one.

Outsourcing Freight Management

There’s a fervent need to find a reliable and reputable freighting company when outsourcing freight logistics. Here are some options you can explore and the benefits they bring along:  

Freight Brokers and Forwarders

Your business may have limited human resources or may lack the expertise to build and maintain relationships with different carriers, look after loads, and tackle claims. Freight brokers can take this burden off your shoulders, as they act as a viable bridge between carriers and shippers to ensure that the shipments flow smoothly among the two parties. 

A broker may take responsibility for negotiating carrier rates, overseeing truck arrivals and departures, and confirming pickups and drop-offs for a shipment.

On the other hand, freight forwarders, much like brokers, become intermediaries between carriers and shippers. They provide many other supply chain services, like handling customs or other documents, ocean or air transportation, inland transportation, freight storage, and warehousing. These forwarders take accountability and even open gates for worldwide shipping.

Third-Party Logistics and Logistics Service Providers 

The Logistics Service Providers (LSP) and Third-Party Logistics (3PL) give you the benefit of time and cost savings along with a chance and flexibility to scale your business operations to higher levels. 

3PL and LSPs mostly take over tasks, including:

• logistics planning
• material procurement
• product sourcing
• maintaining inventory

Some 3PLs may specialise as freighting companies and offer you services like order fulfillment and warehousing. They look after freight operations and shipment and also handle other heavy goods by doing the following:

• Choosing the most cost-effective carriers and shipping companies for your business
• Negotiating and getting you the best possible rates from carriers for heavy freight transfer
• Streamlining your shipments to align with the best transportation mode and balancing heavy cargo
• Perfecting shipment scheduling and pickup for you

Leveraging Technology for Freight Logistics

Sometimes, all you need are appropriate tools to efficiently get your freight across destinations. 

As many freighting companies are integrating technologies like transportation management systems (TMS), electronic data interchange (EDI), warehouse management systems (WMS), global positioning system (GPS) tracking, machine learning (ML), and artificial intelligence (AI) into their freight forwarding services, it’s enhancing their efficiency, reducing costs, and helping them provide better customer service to businesses.

Such tools help:

Automate manual tasks and optimise operations

According to McKinsey’s research, automation enabled early adopters to reduce their logistics expenses by about 15%. Automated workflows add transparency to the shipping process and help use team resources more judiciously. It even cuts down response times, providing higher customer satisfaction.

Communicate Better

Email is the most widely used communication mode in freight forwarding operations for sending quotes, order updates, customs paperwork, and monthly invoice sharing with multiple vendors. 

Improve visibility via real-time tracking

Technology like GPS and the Internet of Things (IoT) are like mirrors that provide unmatched visibility to your shipping. You can track and monitor your freight in real-time and even share instant order updates with your end customers. The transparency also allows you to resolve any mid-shipping issues immediately. You can also reroute shipments amidst disruptions and minimise any possible delivery delays.

Make informed decisions 

The logistics industry collects tonnes of data and several advanced analytics tools convert it into actionable insights, which enhances business decision-making. Algorithms used by machine learning predict potential delays, shipping costs, and optimal routes, enabling freighting companies to negotiate better carrier rates, streamline transportation modes, and customise solutions to varying business needs.

Enhance customer service

Advanced technology helps freight forwarding customer service generate quick responses, enable timely delivery, and provide value-added services. These digital tools allow businesses to easily search, book, and track their booking or shipment information. This self-service makes it convenient for businesses, and freight forwarders can also free up time for more complex tasks. Forwarders can provide personalised support when needed and eventually enhance overall customer satisfaction. 

Encourage sustainability 

Freight transport accounts for nearly 8% of worldwide emissions, according to the Massachusetts Institute of Technology researchers. Digitalisation and big data are toning down this effect, as freight forwarders can regulate and monitor emissions while adapting to more eco-friendly operations, like green supply-chain demand coalitions, modern engines, low-carbon fuels, and more.

Tips for Optimising Freight Logistics

You can positively impact your business as you optimise your freight logistics. Ponder over some tips we’re sharing below: 

Consolidate Shipments in a single truckload

Combining your large/heavy LTL freight to fill a single, full truckload will provide you with a more efficient transportation mode and can alleviate shipping costs for your business.

Multi-stop pickups and deliveries

When you want to send out a smaller shipment, use multi-point optimisation. When you don’t have enough cargo to fill up a whole truck, sharing the ride with other shipments is often cheaper. It’s like carpooling for your products! The truck will make several stops along the way, picking up and dropping off different items. But be mindful of the timing, distances, and order specifications.

Opt for facilities nearer to destinations

If you ship small shipments frequently, consider bringing together small packages into a large LTL shipment and set your delivery mileage leveraging a sorting or distribution facility closer to your shipment’s destination. It facilitates quicker and timely delivery.

Bind freight movement

Think of this as planning a road trip where you hit multiple stops along the way. Instead of making separate trips for each delivery, you link them together in one smooth journey. It’s great for truck deliveries where pickup and drop-off points are close to each other. This way, you’re not wasting time or fuel going back and forth.

Make the most of return trips

This is all about not letting trucks drive empty. Do you know how a truck might deliver stuff to one place and then drive back empty? That’s wasted space! If you can find goods to put in that truck for its return journey, it’s a win-win. The truck company gets paid for both trips, and you might get a cheaper rate because you’re helping them out.

Team up with your suppliers

It means controlling who’s moving your cargo and how they’re doing it. Work closely with your suppliers and the companies that transport your goods. You keep an eye on how well they’re doing their job at every step of the way. This helps you ensure everything’s running smoothly and lets you pick the best transport companies for your needs.

Conclusion

Getting really good at moving cargo around is fairly important when you’re part of the raging eCommerce setup. It helps you streamline your supply chain operations, reduce shipping costs, and keep your customers gleeful. Learning how to optimise inbound, outbound, and reverse logistics can help you move your goods efficiently, improve your service quality, and maintain a competitive edge in the market. 

Moreover, you can achieve operational excellence by implementing advanced freight logistic solutions and focusing on sustainability while contributing to your long-term business success.