Image of a person counting money to represent transportation cost in logistics

3 ways to reduce transportation cost in logistics

Understanding transportation cost in logistics Transportation costs in logistics are skyrocketing because of the increasing fuel prices, labour charges and loss resulting from accidents. Logistics owners, fleet managers and truck drivers encounter a greater financial burden while operating their commercial vehicles. According to a survey, 44% of fleets rated increasing costs as a top challenge to daily fleet operations (Source: G2 Tech Marketplace). What factors affect total logistics cost? Logistics cost management is a tedious yet a highly necessary aspect of the transportation industry. The logistics industry involves a number of challenges with regard to increasing costs in terms of last mile delivery, empty miles, maintenance, insurance costs and more. Why should you use technology to reduce transportation costs? Transportation involves complex operations and therefore, manual processing is often time consuming and incurs a heavy cost. However, technological solutions can efficiently streamline transportation in terms of efficiency and cost reduction.  Technological devices and software including GPS, telematics, digital freight matching platforms and similar technologies prove to be the best solution for reducing logistics cost.  For instance, according to a survey, across a variety of industries, GPS fleet management helps lower accident costs by 16-30%, fuel costs by 7-20% and labor costs 9-25% in 2018 (Source: G2 Tech Marketplace).  3 ways to reduce transportation cost in logistics Let’s Wrap Up! Transportation costs in logistics are increasing rapidly and frequently. Therefore, efficient  logistics cost management is of prime importance. It is necessary to reduce logistics costs in terms of last mile delivery, empty miles and operational expenses. The total logistics cost can be reduced by shipment consolidation, preventive maintenance and data analytics. Integrating technological solutions including Truckload Optimization Software, Transport Management Systems, Digital Freight Matching Platforms, telematics and fleet management software can help with reducing logistics costs. Axlerate provides a unified digital logistics management platform with transportation management solutions to simplify tolls, fuel purchases, fleet expenses, loans, insurance, escrow, payments, truck booking, fleet management and the buying and selling of logistics products and services.