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FREIGHT COST CONTROL


As a organization freight cost increasing it’s a concern and the stereotypes are

  1. Fuel price escalation
  2. Driver salary increase
  3. Maintainace cost escalating

No the above mention factor might not be the reason

Factors affecting freight cost increase

  1. Geographical location :- For Ex If you are manufacturing at Kerala India and your main market is Jammu & Kashmir India , the position of the factory is wrong, need to concentrate on the same
  2. Product Weight :- Due to market competition if your product weight is getting reduced , your per kg transportation rate will increase.
  3. Packing size :- Concentrate on your pack size , if its bulky taking more space so less value materials can get travelled
  4. Product Margin :- It might be the scenario that some extra freight cost is there but as per profit margin it can be maintained.
  5. Freight Analysis :- Keep an eye on freight bill, if you are paying per km ( Up & Down ) or a fixed rate . Depending upon situation Which one is beneficial .

As per SWOT analysis the following factors are internal, if the eyes are kept on the same, freight cost can be controlled.



Sumit Chatterjee
Senior Supply Chain Manager
Dream Bake Pvt Ltd ( Brand Winkies , Mainly into package Cakes division )

More than 10 + years’ experience in FMCG Supply Chain
MBA Marketing & Finance from Future Business School
Post Graduate Diploma in Logistic & Supply Chain from St Xavier’s
Post Graduate Diploma in Export & Import Management from ICFAI University


KEY WORDS

 Logistics, Supply Chain, Trucks, Container, Warehouse Space, Freight Cost, Cost Control, Freight cost management
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Comments

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