Supply chain costs have skyrocketed in the past two years. Many factors are to blame; a global pandemic, increasing labor costs, and gas prices (adjusted for inflation) not experienced in the last 50 years. We utilize a 3PL for our warehousing needs and this March we received notice from our warehouse provider our cost would be going up 30%. Due diligence confirmed the updated 3PL rates were within the market norm and thus we decided to stick with our current 3PL provider. However, we wanted to find ways to limit the burden.
An analysis of our logistics data showed several ways in which we could make a few minor adjustments and change the volume of shipping to our FBA Replenishment Process (using a zero-cost automation). These small tweaks saved us an average of $1.28 per unit on the top 30% of our selling catalog.
Avoid shipping onesie twosies - larger bi-weekly shipments
Use UPC versus FNSKU - saves stickering costs. Could also help with your buy-box percentage and lead to faster shipping times
Fewer shipment breakups - Use seller central as opposed to an integrated platform, and create excel file automations to streamline the process
Our lesson in this scenario is that even though costs are increasing, there are likely low-hanging supply chain efficiencies your organization could tighten up and potentially offset costs.
Written by:
Craig Sweeney
Supply Chain Manager