More than ever before customers expect that even perishable items will be able to be shipped great distances. Refrigerated shipping options are an important part of this expanding economy. Those who produce perishable and heat sensitive goods can now reach new customers with the help of temperature controlled trucks.
However, though this shipping has many benefits, it also has costs involved. Costs for refrigerated shipping can vary greatly depending on the time of year, where you are shipping to, fuel costs and more. Here we will look at what affects this cost, and if it is worth it for you to add this option to your business.
Weather: Hot weather puts refrigerated shipping more in demand which can increase prices. Additionally, the hotter it is, the more energy it may cost to keep the truck cold which can also up rates.
Fuel Costs: If you see prices rising at the pump, that means they are rising in the shipping industry as well. Any time the cost of oil is on the rise, shipping costs will reflect this.
Current Conditions: A host of current conditions can affect how expensive it is to ship refrigerated cargo or cargo of any kind. Anything that may be causing delays in shipping will affect cost. Geopolitical factors along with environmental conditions can both slow down shipping and increase costs.
Delays: Delays can happen for any number of reasons including inspections by police or customs, incomplete documentation of the shipment, and the shipment not being ready for pickup on time. Any delay will add costs to your shipping.
Overweight Items: Some items may not have a consistent weight and this can end up resulting in extra charges if your shipment goes over. In some cases it may even become an issue that a truck does not have the capacity to carry an overweight load. To reduce chances of this occurring, be diligent in weighing your shipment and being upfront with your carrier about the weight. Fuel weights and equipment must also be considered because this is all used to determine total weight.
Loading/Unloading Fees: Often workers from an external source will be used to load and unload boxes in order to give the driver a chance to rest. However, the additional fees for these workers can become problematic if they are not communicated upfront. If you know third party workers will be used for loading and unloading, the driver should know about this in order to plan accordingly.
While some fees are unavoidable, others can be reduced and managed. Consider these tactics to help reduce your refrigerated shipping costs:
Ensure All Documents are Complete: Ensuring that your documents are fully filled out and that there is an accurate description of your shipment listed can help prevent delays especially at customs.
Pre-Clearance: you can get pre-clearance with customs by submitting documents before shipping. This extra step can help reduce the chances of unexpected issues.
Communicate Well: Many delays are due to shippers and carriers not communicating well or frequently enough. Make sure your carrier knows what will be expected on the route, other reimbursable fees that might be involved, and your expectations upfront. Communicating this from the start will also give the carrier a chance to express any concerns or delays they expect.
Overweight Load Permits: You can bypass potential delays caused by an overweight shipment by applying for an overweight load permit. If you, as a shipper, know your load will be overweight you can check with your carrier to see if they have this type of permit.
As you see the costs add up for your shipment, it can be tempting to either choose not to offer shipping on products that need temperature control or to take shortcuts. Maybe you have an item such as chocolate that could, possibly, survive the trip in an unrefrigerated truck but would be better with one. Does it make sense to take your chances on shipping without refrigeration? Let’s look at a few considerations.
Opportunity Cost: While some companies may simply choose to not ship during hotter months, this can lead to stifled business growth. Can you estimate how many customers you could miss out on? Is it worth it to continue shipping to them? More importantly, being diligent in your offerings may grow your audience enough to justify opening another facility near where your new customers are.
Customer Satisfaction: Let’s say you choose to gamble on sending items without refrigeration. While this may work in some cases, it may not be worth the risk. If, for example, you do send chocolate without refrigeration and it melts this could lead to greater expenses than the original shipping. If the product leaks on the way to the customer, it could damage additional products which would lead to great replacement costs. Moreover, all customers affected by this will receive their shipment late or damaged. At that point you will not only have additional costs but also a wealth of customer complaints.
Is It Right for Your Individual Business: While it is almost always beneficial to add additional shipping options for your customers, it can become prohibitively expensive. If you have crunched the numbers and found that you can’t offer your products at a reasonable price with shipping, consider increasing the minimum order that customers must purchase. Typically, the more you ship, the less costly the shipping gets per pound and the more cost-effective it becomes.
Still not sure if refrigerated shipping is right for your company? RoadLinx offers free estimates on shipping via reefer truck. Our services also include temperature controlled shipping for your cold-sensitive items, intermodal shipping, and cross border shipping between the U.S. and Canada.
To get your free quote on refrigerated shipping, call RoadLinx today at 905-760-1141.
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