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International Shipping Solutions

Many companies manufacture and source materials from outside their borders and overseas. Consequently, controlling costs remains a high priority for firms involved in global trade and international shipping. One critical factor that companies make a strategic decision to monitor more closely concerns logistic management.

Logistics covers all activities associated with the procurement transportation, cross-border shipping logistics services to and from Mexico, overseas freight shipping, transshipment and storage of goods.

Depending on the industry, supply chain logistics can comprise 5 to 50% of the product’s total landed cost.

Issues affecting logistics costs

Companies consistently encounter a variety of challenges that affect logistic costs. Issues may include high fuel prices and port delays, which increase transportation fees. Transportation costs rates high on the list for most enterprises because it makes up as much as 50% of all logistic costs.

Inventory carrying costs also has a significant impact, comprising more than 21% of total costs, according to Hofstra University. Companies incur the following expenses when holding goods in inventory:

  • Capital costs
  • Warehousing
  • Insurance
  • Taxation
  • Depreciation

In addition, management must take under consideration labor costs, which involve the physical handling of products— receiving and processing customer orders, labeling, packaging, and customer service.

Furthermore, complicated international trade laws and security concerns may also lengthen delivery times and increase warehousing expenses.

Three tips for reducing costs

There are multiple approaches firms can take to reduce their supply chain logistic costs.

Here are three of the most common solutions:

1 Accurate cost of overseas sourcing

Companies who have lived in surprise supply chains must work harder to ascertain the true cost of sourcing overseas. This includes accurately calculating freight, to the, brokerage, and inventory carrying costs. Management must also factor in other such as the cost of flying personnel overseas. Gaining an accurate understanding of the true total landed cost and total impact to the operations can help you make better comparisons when it comes to domestic procurement. Sourcing from the United States to a Canadian plant, distribution center, or customer may provide a more cost-effective alternative than sourcing from Asia.

2 Cost-efficient compliance processing

Transportation companies understand the value of implementing software solutions that automates the trade compliance process. These applications speed up the cycle time for many tasks routinely performed manually, such as document preparation and evaluation.  Software can also eliminate common mistakes associated with manual responsibilities, improve internal controls, and enhance overall operational efficiency. Companies that automate compliance processes experience fewer delays at border crossings, which is improve on-time delivery. Firms can also maintain adequate inventory levels, increase customer satisfaction, and avoid costly penalties and fines.

3 Minimize express shipping costs

When some companies encounter a supply-chain issue that causes a delay, many will panic and approve an express global cargo shipping solution—the highest cost service level—for the product order. Control expedited overseas freight shipping costs or other international shipping expense by calculating the amount of goods the customer requires immediately and ship only that amount at the express service level. Transport the balance of the goods using the standard service level and lower cost.

Third-party logistics management

Increasingly, smart businesses make the strategic decision to combat high logistics costs by partnering with global logistics experts. These firms function as consultant, brokers, and logistics managers. Companies that require Canada to Mexico transportation, international shipping, or other logistics services can take advantage of the buying power of third-party logistics firms. 3PL Links can provide warehousing and distribution services & solutions throughout Canada, US and Mexico.

They can not only reduce their international sea shipping costs and other global cargo shipping expenses, but benefit from a single point of contact for their logistics needs.

3PL Links can take care of your cross-border shipping requirements to and from Mexico. Our Logistics division can cover all activities that are related to the procurement of transportation from Canada to Mexico or the other way around.  We can navigate the complexities of the various free trade agreements and time consuming paperwork and administrative processes that involve shipping freight to or from Mexico. Whether you’re shipping a full truckload, or  require LTL shipping, we can make sure that your freight is delivered to its destination safely and securely.

Why using a 3PL, is an advantage

third party logisticsAs companies look to the future, more and more of them are realizing the benefits to be gained by outsourcing their supply chain management. The integration of a third party logistics provider or 3PL allows companies to leverage a large network of resources to develop an all in one solution for assembly, packaging, warehousing, and distribution.

3PLs allow for each step in the supply chain can be executed in the most efficient, cost effective way. 3PLs can leverage relationships and volume discounts, resulting in lower overhead and the fastest possible service, all things unavailable with an in-house logistics team.

Today companies are always chasing to keep up with the 30 second attention span, rapidly-evolving, customer-centric environment in which they operate in. Even knowing what technology is needed can be challenging for supply chain leaders; with much of the industry blind to the future ROI. Moving forward with the expectations that what has worked for a business in the past, will keep working in the future, has paved the road to the future with the ashes of obsolete companies… don’t see many people rent a movie from Blockbuster.

The old regime is being replaced by a new level of demands on cost, service, and quality. A benefit of using a 3PL provider is the ability to scale space, labor, and transportation according to inventory needs. Businesses with seasonal periods can enjoy stress free transitions between industry ups and downs, having the ability to utilize more space and resources when needed.

To keep your company on the right track the integration of a 3PLs knowledge of industry best practices, will create fortified lines of communication keeping you up to date with the latest developments in technology. 3PL software is capable of advanced reporting, inventory management, and provides visibility to monitor the entire process. 3PL experts employ Just in Time practices to ensure the correct amount of inventory is shipped when and where you need it.

In my personal experience I have seen the 3PL ecosystem comprised of a mixture of both senior experience and youthful innovation, leveraging each other’s skill sets and knowledge. This all culminating in a progressive platform to help maximize profits, reduce wait times, and improve customer service. Allowing your business to grow for years to come, by providing the resources to streamline your supply chain, reduce inefficiency, and the technology that ensures your goods arrive when and where you need them.

Utilize a Logistics Management Specialist to Increase Your Profits

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The Importance of Supply Chain Compliance

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The Best Small Business Logistics Solutions for Increased Growth

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Fortunately, you can overcome the challenges of logistics with the right solutions. To help you improve, let’s take a look at the best small business logistics solutions to invest in. Continue reading

6 Signs You Need a Supply Chain Analysis

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The Benefits of Hiring a 3PL Company

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3PL Links Case Study: Manufacturing (Outdoor Equipment)

3pl_manufacturing_outdoor_equipmentFor people around the world, enjoying the outdoors is a critical component of happiness. 3PL Links has had the privilege to work with an entrepreneurial and innovative world leader in the design and manufacturing of ready to assemble outdoor living products for residential customers. This client delivers exceptional play and leisure structure options around the globe to children and adults alike. Operating under three distinctive branded product lines, this client creates products adhering to the highest standards in quality, safety, value, and fun.

Much like many companies in the modern economy, they are eager to capitalize on emerging trends in today’s consumer marketplace. For this client, that means having the ability to mobilize resources and engage their supply chain to continually exceed their customers’ demands. This need drove an engagement with 3PL Links.

Read the full retail apparel case study here

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