Whenever wholesalers source products from anywhere
Distributors are working to develop strategies and cost-effective processes to let their customers get the wholesale products at nominal rates. They consider that increasing logistics costs should not over-shadow the prices of wholesale products. Logistics industry is quite dynamic and prices fluctuate on almost weekly basis due to fuel prices, delays in delivery time and various export & import duties. One time increase in fuel prices doubles the logistics cost. Therefore, it is necessary for wholesale distributors to find out ways to reduce logistics cost.
Distributors must constantly check the market rates, for example, calculate freight, import & export duties, inventory costs and different logistics carriers to choose the best practice out of all. Once you have calculated all the costs, you may set up the landed price of products for different distribution regions. You may also decide whether to go for the international distribution or limit yourself to the local markets only.
Consider different services and their different charges and decide how much you can afford to pay and through which medium. Undoubtedly, faster products delivery mode is by air, but it is quite expensive and at the same time, shipment through sea is quite nominal with different size containers suitable for different needs.
You should patch up with various other distributors to consolidate their products into one shipment. It can reduce the individual burden of logistics costs on each distributor. For longer route, the consolidation can result into a more cost-effective shipment mode.
Keep your customers informed about the varying logistics and freight costs for different wholesale products so they can make well-informed decisions about the final inventory costs. It is necessary to communicate the varying costs to wholesalers to share logistics cost with them or to let them choose the less expensive option (local suppliers).
A distributor must check different insurance companies which cover shipment of wholesale products in which you are dealing. It is important because if you choose the carriers' insurance it will be costly and if your company is self-insured it will reduce your extra cost that you will have to pay to your carrier to share his insurance cost.
Automate your supply chain system to enhance the trade compliance and speed up the delivery system. The companies which have implemented software solutions overcome the additional costs of document preparation, manual tasks, related delays & errors, negligence of real statistical data and customer satisfaction. Internet tools always help in reducing cost. Doing all this distributors can reduce the logistics cost efficiently.