Shipping delays are inevitable in today’s fast-paced and highly competitive global shipping landscape, but there are things you can do to minimize the impact and frequency of delayed shipments.
Missing order deadlines are a logistics coordinator’s nightmare. It usually means that you are held accountable for losing money to chargebacks or other contractual terms. Although you are not likely to reduce the penalties incurred for late shipments, with some advanced planning strategies you can mitigate some of the loss when delays are unavoidable.
Get Familiar With Customer Contracts
A deep understanding of your customers is essential in planning for freight shipping delays.
If you were not involved in the negotiation process, familiarize yourself with your customers’ contracts — specifically, the areas of the agreement that are related to order fulfillment.
Knowing the penalties you will face for missing an order deadline and how lenient your customers are will help you to prioritize your efforts when your back is against the wall with your P.O. window.
A little flexibility in your order fulfillment terms can give you wiggle room with some retailers, but understand that many ‘big box’ companies have a list of non-negotiable clauses. The shipping manager needs to be aware of the expectations and penalties related to each customer, so they can react accordingly when unavoidable delays occur.
For example, if shipments arriving via ocean freight are not going to arrive in time, the logistics coordinator can decide what is going to be more cost-effective, paying the penalties or spending significantly more to send the order by air. Another option is to ship part of the order on schedule to tide the customer over while you arrange to get the rest of the units to them. Knowing your vendors and communicating with them is key.
Use a Forwarder That Excels in Both Ocean & Air Shipping
Some customers are going to expect their orders to arrive by a specific date and time no matter what.
Depending on your company’s relationship with the customer and how well the product you are shipping is selling, a freight shipping delay could result in the loss of the contract.
With this in mind, you need a backup plan in case shipping by ocean carrier doesn’t work out. Using a forwarder that specializes in both ocean and air freight gives you more options and allows flexibility with your decision making when you're up against a deadline.
If you use a forwarder skilled in both, especially one that has 3PL expertise, they can quickly redirect some or all of your shipment through the skies. Otherwise, you end up scrambling to reposition your shipment with another forwarder or deal with increased costs because your current forwarder outsources air shipping to another provider.
Plan Ahead For Peak Shipping Seasons
It may seem obvious to plan for peak shipping season, but there are a couple of tricks that can be used to minimize delays during these highly competitive months.
Everyone is rushing to get their goods out from August through October for the holiday season, and again from the end of December to the beginning of February before China shuts down during the Chinese New Year. Prices go up, and space is limited, so it’s imperative to plan ahead and reserve shipping dates well in advance.
Since everyone is trying to get their items shipped overseas as quickly as possible, you can reduce your peak season shipping costs by taking slower transit times. An added benefit to this is that you can avoid freight shipping delays because your cargo has less of a chance of getting rolled, as the slower times are ‘less desirable.’ If you understand the production capabilities for the items that you’ll be sending and can plan even further ahead than usual, utilizing slow transit times can help you prosper during the busiest times of the year.
Carriers tend to overbook during the busy season and rolled cargo becomes a significant concern. It’s one of the biggest causes of freight shipping delays during peak season.
Carriers tend to roll bills of lading, not individual containers. So if you are shipping multiple containers and have your entire shipment on one bill of lading — and your bill happens to pull the shortest straw — your whole shipment will get rolled. It’s a little more work but dividing your freight up into various bills of lading is an excellent way of increasing the likelihood at least some of your containers will ship on time.
Pay Attention to Major Product Launches
Paying attention to upcoming product launches can help you avoid freight shipping delays as well.
If you know when goliaths like Apple, Samsung, or any other popular brand is going to be releasing a new product, you can plan around the fact that they are going to be dominating the air freight markets coming out of Asia.
Air freight prices are going to sky-rocket during those time-frames, and you may not find air shipping availability at all. A smaller order you thought you could handle easily via air cargo could suddenly be delayed or you may be forced into paying exorbitant prices to get it delivered on deadline.
Paying attention to details like these will help you avoid some potentially bad situations.
There is no way to avoid freight shipping delays completely. However, you can create contingency plans that drastically reduce how often they occur and the overall impact that they have on your company’s profit margin. Communicate with your vendors and understand their expectations, choose a reliable freight forwarder that offers multiple freight options, and plan in advance for peak shipping seasons.