Hurricanes, Oil & Shipping

It is absolutely upsetting to see the pictures and read the stories of those affected so dramatically by the hurricanes in the Gulf of Mexico. The devastation in some of these communities seems irreversible.

A silver lining with these 2008 storms is the minimal damage to the oil refineries in the Gulf. The anticipated but un-materialized damage to infrastructure has taken some of the crazy speculation out of the global oil market.

With the price per drum dropping below $100 per barrel from a high of nearly $150 I suspect that the inflationary pressures on many products will weaken. More importantly the cost of shipping and fuel surcharges should start to come down - although I'm sure not as quickly as they went up in the past 12 months.

Reducing Freight Costs

We sure do understand the pain of an unexpectedly high freight bill. With fuel costs being what they are right now, fuel surcharges can add 70% to an already high freight bill!

Here are a few tips to your freight to keep costs to a minimum:

• Consolidate orders, if possible (if you purchase 1,000 lbs. twice a month from a vendor, order 2,000 lbs. once).
• Large LTL (less than truckload) shipments are sometimes charged at full truckload prices and surcharges. Splitting a large order into multiple shipments can actually reduce the overall cost.
• Deliver freight to an occupied commercial address with access to a forklift truck. A residential delivery with a lift gate as well as delivery scheduling and notification can add as much as $400.00 to a freight bill.
• Talk to your vendors and freight carriers. They can assist in uncovering other options to avoid spending more than necessary.