We know expedited shipping has a lot of benefits. All those benefits often bring up the question of cost. In the past, expedited shipping generally worked out to be cost-prohibitive for any but the most time-sensitive shipments. Today, expedited services provide a balance to supply chains that require speed and cost-effective solutions to their logistics needs.
Expedited shipping is often filling the role in today’s market as a supply chain problem solver. And when smart shipping strategies incorporate expedited methods as a tool, the cost is no longer prohibitive to the business.
Making Expedited Shipping Cost-Effective
By incorporating expedited shipping as a larger supply chain strategy, you’re able to avoid common unexpected costs that take businesses by surprise and can greatly affect the bottom line. Let’s review what those are:
Inventory Carrying Costs
You’ll pay more to ship expedited, but the savings from being able to carry lower inventories will often exceed the cost. When manufacturing plants are down for days, losing hundreds of thousands of dollars in production because they’re waiting for essential parts to arrive will cost far more than the cost to expedite those parts to the plant.
Additionally, replenishment strategies keep shelves stocked for customers at the end of the supply chain, helping companies not lose out on days of an item being out of stock.
Chargebacks and Returns
Knowing exactly when something will arrive and in what condition it will arrive greatly diminishes the occurrence of two other big costs to businesses: chargebacks and returns.
Suppliers must often hit tight delivery windows that don’t allow room for flexibility. The added cost of expedited shipping with a guaranteed delivery time can easily offset the risk and cost of a chargeback for missing the delivery window.
The added benefit of less handling, dedicated vehicles, and shipment security help guarantee that items arrive undamaged and in pristine condition. Not only does that help minimize returns, but in the case of larger items where boxes are displayed on the store floor, those lacking wear and tear of travel are much more likely to be purchased.
For many shippers, the use of expedited has become an integral part of their supply chain strategy, not just an emergency solution. To see how Pride Logistics can help maximize the cost and benefits of expedited shipping for your business, get in touch to speak with an expedited shipping and logistics expert today.