Cutting Freight Costs and How You Can Benefit From Them

Regardless of how long you have been in the liquidation industry, it is very hard to be an expert of everything. However, if you are only starting out, even taking a few small steps will help you become more successful. For instance, even though you may not realize it right now, the shipping or freight costs that you are paying eats into your profit and the final product may even end up costing you a lot more than your anticipated. Therefore, it is important that you learn exactly how to cut freight costs and the different ways in which you can benefit from doing so.

Cutting Shipping Costs

Here are a few tips that you will find helpful when it comes to cutting freight costs.

Research Extensively

While looking for shippers who can help bring the products you have bought, make sure that you research about them. No matter which state or area you live in, researching will give you a good idea about the company’s operations and their average costs. Researching will also tell you about the top most reliable and popular shippers, allowing you to make a sound choice.

Know Your Basics

Even though it may not seem so when you start to use shipping carriers, knowing the basics of your packages will help you a lot. Therefore, before you even start to look for land, water or air carriers, you need to make sure that you know your package, its dimension, destination, weight, and volume like the back of your hand. You must also have a printed copy of all of these details with you while the shipment is on its way to you so that you know exactly what you are paying for.

Understand Various Trucking Services

The less-than-truckload carriers or LTL are companies which combine smaller shipments from several vendors on the same vehicle or truck and so are able to make multiple deliveries. If you order your shipment from these trucking companies, they will move through a network of terminals before they reach you. At each of the terminals, the goods may be taken off and transferred to another truck that already has merchandise destined for the same region or area. LTL is ideal if you do not think that you will need the full volume of a truck but instead have bought small lots that can be adjusted with other items.

Consider the Delivery Dates

If you plan to or have already purchased multiple pallets or lots from a single vendor or location, you will save a considerable amount if you consider delaying the delivery of the products. If you decide to ship multiple orders at one given time, you will be able to move the freight using an inexpensive multiple pallet LTL or truckload shipment.

Check out some of the common shipping companies and their costs while keeping in mind the number of pallets you will be shipping. You can save hundreds of dollars simply by planning, which in turn will help you increase your profit considerably.

Use Services of Salvage Liquidators

Some wholesale liquidators offer transport management as a part of their overall service. Using these services will not only help you in gaining insight and advice about the least cost shipping methods, but they can prove to be beneficial when you want to gain discounts.

Another way you can make use of these is with pallet pricing. Even though most liquidation buyers receive the standard carrier pricing, which depends on the weight and type of goods being shipped, some salvage liquidators that move large volumes can reduce their costs. These liquidators will negotiate with the carriers and establish a fixed price per pallet. So no matter how heavy your shipment is, your price will be the same. If you start buying from such liquidators, you will be amazed at the savings that you make at the end of the month.

Learn the Art of Negotiation

Every shipping company that you approach will have pricing schedules according to the volume of your package or lot. As a general rule, the more items you ship, the lower your rate.

However, most new liquidation business owners do not realize that they do have the negotiation power. You yourself probably did not know that if you are shipping large numbers of packages and lots, you can always compare the prices of several different carriers and persuade one of them to offer low rates.

It is important to remember that negotiation is all the more important in your kind of business because if you are able to strike a good deal, you can enjoy their services for a much longer time.

Consider Using the Packaging Provided by the Carrier

Even if you are in the liquidation business, using your own packaging will make you face additional dimensional charges if the package or box exceeds the standard size regulations set by the carrier. To avoid these charges and spare more of your profit, consider using the packaging or boxes provided by the carrier company because these will have no extra dimensional charges.

Get Goods Delivered to Your Business Address

Most of the carriers will charge you extra if you get the products delivered to residential locations. If the location where the pallets or lots are supposed to be delivered does not have a loading dock, they will require more expensive trucks that have lift gates to help bring the pallets down from the trailer to ground level.

Carriers also add more costs to residential deliverers because it would take them much longer to unload the truck and get it back on the road as industrial deliveries. These costs, if not taken care of, will end up in the form of ‘accessorial charges’, which can be more than a $100 for a single pallet.

Search for Vendors Near You

One of the best ways you can save on freight costs is by purchasing liquidation merchandise from a vendor or supplier who operates from a nearby location. Because the shipment cost is a lot more important than the price of the lot you have purchased, the cost will skyrocket if the product is in North Carolina and you want it to be shipped to California.

The best deals are not always the smartest buys, especially if the freight costs are too high. Another benefit that going for a vendor near you will provide you is access to a pickup truck, which is the cheapest shipping method of all. So take the time to identify the best and most reliable local source and make sure that you are not spending a lot.

Use Framework Agreements

If you use any particular truck carrier regularly, you may be able to get the framework agreement for your shipment costs. To do this, you must make sure that you have all the information about the discounts and any extra charges so you know that you are going for the best deals. These agreements can also prove to be highly beneficial when you have a supplier who has a good and strong on-going relationship with the carrier.

So ask your vendor if they have any carrier that they are satisfied with and find out if you can benefit from the deals and prices that they receive. If you have a good and understanding liquidation product provider, he will be more than happy to help you.

Maintain Good Communications with Vendors

One of the best ways in which you can reduce the freight costs of your business is to be good at communicating with the vendors providing you with the products. Even though you may have a professional relationship with your suppliers, you should make sure that you are polite and friendly when speaking or communicating with them.

You can also ask these providers for any money saving tips or methods which you can use to cut down on the costs. Questions like, ‘do you have a preferred day for shipment?’ or ‘will it be feasible for you if you send the batch of lots in a week later?’ are necessary if you wish to gain profit with your business.

Check for Billing Errors

While using several carriers for your liquidation business, some billing errors are easily overlooked or ignored. To avoid this mishap which may end up costing you a lot of money, make sure that you audit the carrier invoices for mistakes. Even though the number is not very high, 5 to 10% of all freight invoices have an error or service failure that is costing you. Therefore, it is recommended that you either do your own check or contact an auditing company to check your invoice and tell you of any mistakes made by the carrier.

The Benefits of Cutting Freight Costs

Now that you know about the several different ways in which you can cut freight costs for your liquidation business, here is an overview of all the benefits you get by following our recommendations.

Turn Losses into Profits

First off, because the freight and shipping costs of your business will represent all most 2-4% of your entire revenue, not considering the tips discussed will only lead you into losses. On the other hand, if you carefully think about and implement all or most of the factors which have been mentioned, you will be able to turn those losses into profits and your business will immediately start to bloom.

In fact, there have been a number of companies that claim that the entire outlook of their company’s future changed after they started to take freight costs seriously and cut them where necessary.

Good Relationships

Another great benefit of cutting shipping costs is that it helps you maintain good relationships with your vendors. Even though freight costs will be paid by you, the supplier will be thankful to you because there will be no need for you to tell them to change different things so the charges can be lowered.

These good relationships will not be limited to the vendor, but will also extend to the carriers you are using for shipping. If the costs are figured out, you will have a lesser chance of arguing with the freight company about the prices that they are offering.

Business Growth

One of the main reasons why business owners want to cut freight costs is because it helps them grow their business. It is simple – if you are spending more than what you ought to on shipping, you will not have the chance to buy merchandise for your customers, which in turn will automatically take your business down.

However, when you reduce the freight costs and know exactly where your hard earned money is going, you will have a much higher chance of buying goods and liquidation products that your consumers are interested in.


No matter where your shipment is coming from, you can almost guarantee that the costs will be higher than your profit if you do not seriously start considering cutting them down. Even though it may take you some time to implement all of these changes, doing so will change your entire liquidation business for the better and lead you towards success.

Still, if you are unsure about what you should do to cut these costs right away, you can always consult experts on the subject and read about the several ways used by them. At the end of the day, it is crucial to know that these costs are as important as the ones which you spend on buying the products of your choice.

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