5 Cost-cutting Tips for Transport Companies

Apr 27, 2018Fleet Blog

Cutting costs and boosting profit is vital for all companies, not just logistic based businesses. So, what are the best ways to save money when transporting goods?

Look at labour costs

Take a look at where you could reduce labour if you have a warehouse operation in place. That’s not to say you should replace all your staff with robots, but having a look at labour management software programmes can help you to better manage work in the warehouse.

Motivating staff with incentives will help increase productivity, and try warehouse mobility. This will result in less equipment and fewer staff will be needed.

Focus on preventative maintenance

This will save you money, time and put fewer people at risk. If a lorry breaks down mid-delivery, then that would cost you a lot, not only in immediate costs but maybe it could even cost you a long-term contract too. Spotting things before they break will put fewer people at risk. Make sure that all equipment is well looked after, and in the event of a mishap make sure you have an efficient plan B that everyone is aware of, so you won’t lose as much when something does go wrong.

Make sure all staff are appropriately trained for their role, to prevent injuries and accidents and keep things moving at a quick pace. Some events can’t be avoided but following the correct procedures will help things run smoothly.

Take a look at your fleet insurance

Lorry fleet insurance doesn’t need to be one of your biggest outgoings. Shopping around and comparing truck fleet insurance quotes might be a good idea to make sure that you are getting the best deal and the correct amount of coverage.

Things can get costly if your insurance doesn’t cover you. You may want to consider adding public liability insurance to your existing policy, as this covers your business when you’re dealing with members of the public or employees from other business’. It would cover you if you were to damage the property of another businesses premises whilst dropping off a delivery. This not only gives you peace of mind but protects you if something was to happen.

Focus on the customer

Keeping the cost per order of logistics low is a requirement to keeping your customers happy and in order to keep them working with you. Being able to go beyond the customer’s expectation will help keep business up and spreads out the burden of logistic cost reduction over a higher number of orders or customers.  Customer service should be factored into any adjustments in price that you make.

Bonus tips to reduce logistics cost

  1. Improve storage density in bins & racks by improving vertical space utilisation, you may consider bin re-profiling as a means to achieve this.
  2. Decrease transportation costs through stricter truck utilisation in both full (FTL) and less than truckload (LTL) shipments.
  3. Decrease damage to case picked pallets by reducing movement in transit.
  4. Better utilise available floor-space to increase storage density
  5.  Encourage organised operations that are directly linked to labour, productivity, asset utilisation, and inventory precision.

By utilising these strategies, you should be able to improve the bottom line of your transport business.