Meeting the shipping needs of a diverse customer base is more important now than ever. Due to backlogs of shipments and changing regulations in cities due to the coronavirus, having an option to purposely defer shipping slightly may help you and your customers.
Deferred shipping is an efficient and cost-effective solution for shipments with long lead times or without time constraints. Multiple shipments are purposely delayed and consolidated to be transported as a single shipment. It can also be used by customers as a way of deferring payment.
Consider some of the different ways deferred shipping can apply and when it may be best to use it.
Deferred shipping is a fairly simple concept being used to manage certain freight challenges. Between manufacturers trying to make up for lost time, a shortage of workers across the industry, and delay-causing congestion in nearly every port of entry, shipping complete sets of items can be difficult.
Shipping delays have become almost inevitable. Motor carriers and air freight systems across North America and the world are trying to come up with solutions to get cargo where it needs to be in a reasonable amount of time and within budget. Deferred shipping is one of those solutions.
Consider this scenario. You have a contract to deliver household furniture to retailers from a distribution warehouse. In previous years, all pieces may have arrived at the same time, but now sets of tables and chairs are arriving separately. Rather than make multiple trips for the chairs and then the tables, deferred shipping allows you to wait until both have arrived.
The delay still exists, but businesses don’t have to offer piecemeal items to their customers.
In a similar way, you can offer deferred shipping to customers. If customers are waiting for the delivery of a multi-part shipment, offering to defer payment on the delivery until all pieces are together may take some of the sting out of the wait time.
Deferred LTL is the process of deferring shipments when using less-than-truckload shipping for smaller amounts of freight that won’t take up too many cubic feet. Your goods are sharing space with other LTL shipments and may take slightly longer to arrive at their destination.
If you already have an agreement with a business for deferred shipping or if the freight is part of a routine restocking of items, these short delays can be worth the money saved. Businesses that are paying for routine shipments can avoid the higher freight rates for expedited shipping.
Deferred or otherwise, LTL freight is still a major expense for businesses large and small. Before you offer deferred shipping truckload services for small packages, be sure that fulfillment can still happen within a reasonable amount of time.
Yes, deferred shipping can apply to full truckloads. Retail consolidation can even allow you to combine your load with that of other small-volume shippers for a full truckload shipment and save on multiple LTL shipments. However, depending on the conditions goods require, deferring on delivery may not be possible.
Goods that require specialized services and may be harmed by delays include:
The United States is a big place and trucks can only travel so fast. If shipments require specialized containers or have special restrictions, offering deferred delivery may not be an option.
When deciding to use deferred shipping, you should consider the nature of the items and the frequency with which they are delivered. You should also consider how you will offer deferred shipping to your customers.
Merchandise that is being restocked on a regular schedule and is non-perishable is a good candidate. Items such as auto parts, paint, or cleaning supplies are usually consumed quickly. Many businesses don’t want to worry about having to manually reorder such items and will have automatic renewals put in place.
Regular deliveries mean that the customer is less likely to run out of an item completely. An occasional delay of a few days for the sake of being able to send a full order may be worthwhile. Offering deferred shipping to such a client may give you both a price break.
Deferred shipping is often credited with being less expensive than expedited shipping. However, this does not mean it will always be cheaper.
A customer who does not want to pay the extra cost of expedited shipping for a standard restocking order is likely to save money with deferred shipping. At the same time, a wider delivery window provides importers with a chance to find the best route to minimize expense.
In the case of offering deferred shipping, there are other factors to consider. Waiting has its own price in the fast-paced world of international trade.
Consider these variables:
None of the above factors will automatically make deferred shipping too expensive. However, they should be considered when offering deferred shipping or allowing a customer to defer payment.
Be aware of average lead times for commonly shipped items. Communicate clearly with customers and possibly offer tracking services to be sure they know their deliveries are important. While not much can be done about changing gas prices, you can price services to include a margin for differences.
The advantages of deferred shipping will depend greatly on what is being shipped, where it’s coming from, and the method being used. These factors need to be weighed carefully to ensure you and your customers are benefiting from the arrangement.
In summary, possible advantages include:
There are a variety of challenges facing the freight industry in these times. Working with a combination of possible solutions and being sure to have a strategic and reliable partner for your truckload needs will go a long way in not just surviving, but thriving.
If you are looking for solutions to manage your operating costs, look no further than USA Truckload Shipping. Offering a variety of full truckload and LTL services, we can become a trusted partner in your business.
Whether you need standard truckload services, heavy haul, refrigerated units, flatbed or more, USA Truckload has your back. We have years of experience in the business and can work with you to come up with customized services.
Visit us today and request a quote with no obligations attached. Continental U.S. shipping for all your freight needs is within your reach.