I’ve had the pleasure of meeting with many small to medium size companies in my 20 plus years of working in the Transportation Industry. Many of these companies I witnessed starting from the ground up. From trying to come up with an effective slogan, to grasping to understand the way Logistics works, and finally struggling to become efficient in shipping out their products. The freight industry is very dynamic, and in order for a company to thrive and overcome the various obstacles, there are some basic procedures that need to be put in place in the area of shipping. Sure, a company can shun using these procedures, but the consequences can become a tremendous setback to the growth of their company.
The following are 7 processes that a good business establishes for their shipping department at a minimum. Without these, increased expenses, damages, and unhappy customers are sure to follow:
Product- In order for a company to thrive in their logistics department they have to have a full grasp of what their product offers and the need it fills in the marketplace. Now let’s think for a moment… Why would a Shipping department need to know the advantage their product brings to the market? In this day and age it is very important to understand one’s competition, and where they are located in relationship to your company. If your product is manufactured on the west coast, and your customer is located on the East coast it could be considered business as usual. However, add this to the mix- your biggest competitor is 25 miles away from that client. You have already established value with this client with a wonderful sales staff, but now you need to make sure the product gets across country expeditiously, economically and without damage.
Understanding the value and the location of your nearest competitors will help to add to understanding the proper mode of transportation that is needed to secure a smooth delivery. On a separate note, this is why many companies are turning to a 3PL to establish a presence through the use of warehousing in a central location. I have known customers who really didn’t have to worry about being expeditious to beat the competition because there was none. There product stood no competition and their clients had to buy from them, chances are most companies aren’t that lucky, and your competitors grow each day.
Mode of Transportation- This brings us to the second point. Understanding the proper mode of transportation to get your product to your customer in an efficient and timely manner is another vital factor to shipping. Nowadays, it’s a known fact that many customers are electing to use Freight services to move their product across the country. This method is definitely the most cost efficient; however, there may be times wherein your product might benefit more from using an Expedited Service. Perhaps expedited may not be the most cost efficient, but understanding the transit time that your customer needs, as well as understanding whether the product is prone to damage, moving it via the air might provide less damage risks and a faster transit time.
Packaging- This is an aspect of shipping that many customers, especially the smaller shippers, tend to overlook. The main reason people skimp on proper packaging is because of price. Typically, to establish a reliable packaging concept one needs to hire a consultant to perform drop tests. In this day and time customers know there business, and especially their products and often times can determine, with great success, how their product should be packaged to avoid excess beating. It is very important in the event of damage, for the shipper to learn from this and to exercise stronger precautions on the next shipment- no matter who caused the damage.
UYCN- Otherwise known as “understanding your customer’s needs”- this is vitally important in the Transportation Industry for a few reasons. No one knows what works best as far as delivering a product to a customer then the customer themselves. Whether it be that they need a liftgate (because of no dock), inside delivery (because of lack of personnel), or a smaller truck (because of lack of space) the customer will know this information. And many times they will fail to communicate this to you the shipper. It is your job to ask them. Don’t expect for your carrier to know, and if they deliver without receiving this information, please believe that you will be charged. A great habit that many of my clients do is to keep each of their clients details in an excel spreadsheet so that the information can be updated as need be.
CCNC-” Communicate your customer needs to the carrier.” This is pretty common sense, but you’d be surprised how many customers take it for granted that the carrier will have certain resources at their disposal. For example, in Freight it is thought that ALL carriers have Air-Ride vehicles and liftgates. That’s not the case!!! So make sure you don’t assume this. You need to make sure that you ask for what you want. There may be an extra charge depending on who you use, but you want to make sure you get the order right the first time.
Liability Requirements- Nobody wants to have damages, but when you ship via Freight carrier things happen. Make sure you understand the liability process, and communicate it to your customer- especially if you ship a product that you know is prone to damage. When you’re up front with your client it shows the added value that you can offer as a vendor and gives them a reason to do business with you, and maybe not the guy next door.
Method of Payment- When you establish your business it is necessary to make sure that you establish how you want your customer’s to pay. Or if you prefer to give your customers options: Some typical options are: Prepaid (Shipper bills their customer); COD (Freight company collects from shippers customer); 3rd Party Bill (Billing a source other than your customer)
On Line Tracking- Last but not least, you want to,, YOU need to make sure that you have a resource/tool that allows you to have full up-to-date tracking and tracing capabilities. Of course for the obvious reason of letting your customer know what’s going on, but in the event that your customer’s product becomes damaged during transit if you are aware of this you can now issue a replacement before too much damage is done- in this scenario customer loyalty is number 1. If a customer that you ship to has to hold on to a damaged piece of equipment that they need, and wait for you to ship another one they might decide to seek another vendor out of pure frustration.
Earl White is a National Account Manager, with One Stop Logistics a Third Party Logistics company based out of Watsonville, Ca. He has been in Sales for over 15 years and works with many sales reps to help them gain better footing when it comes to the elusive practice of working with clients. He enjoys being able to pass on many of the skills he has learned from Top Salesman in the Industry.