Now is a good opportunity for small business to analyse its delivery transport operations for efficiency – doing so will help small business control costs and avoid some common delivery transport traps.
Any business which depends on delivering goods for survival knows transport costs can quickly get away from you.
I’m referring to the thousands of small-to-mid-sized companies which need more than parcel post, they need a dedicated transport solution. This will either be managed in-house or outsourced to specialist suppliers (often a combination of both), whether they are delivering building materials, automotive parts, hospitality supplies, medical equipment, high value and/or fragile goods.
Maintaining efficiency requires constant vigilance, but the rewards for this vigilance include better performance, improved customer service, and fewer headaches.
There are some common delivery transport traps to watch for.
The first major delivery transport trap I see business fall into is being tempted by “false economy”. This generally involves the promise of low headline delivery rates.
Anybody can buy a van or two and call themselves a transport company. There is no shortage of delivery operators with low headline prices which end up costing more down the track.
How do the costs blow out? In myriad ways. For example, you may be hit with unexpected costs/surcharges which were not clearly articulated in the agreement.
Or perhaps they are unreliable – if you’re servicing a time-poor industry such as automotive parts, it’s not much good being cheaper if it takes two hours longer. Time is money, and your customers will look to other suppliers if you can’t meet and even exceed their demands.
False economy may also bite if the delivery company has poor safety protocols and poor monitoring systems. They may not track deliveries properly, resulting in missed, mistaken or misplaced items which are then difficult to correct.
Business needs to look beyond the rate and consider how this transport company can make your business better. How will they streamline your processes and ultimately save you money? If the delivery transport firm doesn’t have the systems or experience to improve your business, it’s false economy – and if it sounds too good to be true, then it usually is.
Another big delivery transport trap is not understanding the exact delivery costs for your business – this means isolating all those little hidden costs in delivery transport, which can quickly add up.
Once you know all your costs, you have a benchmark for improvement. You are in a better bargaining position and able to implement positive change.
Finally, a common trap is failing to implement tracking technology via a good telematics system – this may seem obvious, but research shows many small-to-medium delivery fleets have dragged their heels on implementing telematics.
This technology plays a key role in planning, monitoring and analysing delivery routes. Telematics also cuts down on delivery errors and misplaced parcels. It may be tempting to hold out from investing in a telematics system, but there are many systems that are reasonably priced and may save you money, and solve some headaches for you in the long run.