LOGISTICS

We were able to negotiate with our client’s customer to pick up their orders FOB, which saved our client all of the international shipping fees equating to approximately $100,000 in savings per year.

BACKGROUND

We worked with a company that accepted purchase orders from Crate and Barrel for a ship window that was too tight. Instead of requesting that the buyer change the shipping window to a later date, this company approved the POs. The company was not able to get the items produced in time to ship via sea-freight so they decided to ship via air. Over the course of this season, this company spent over $90,000 in air-freight fees to ship 10 purchase orders meaning they took a very large financial loss on this sale.

 

THE BACK AT THE HIVE APPROACH

For the next season, we were hired to help oversee production and logistics. When we received the purchase orders from Crate and Barrel, we worked the factory to improve the production timeline and provided a realistic delivery date to Crate and Barrel to include 30 days on the water. We worked with two of our best freight forwarders to get quotes for shipping each order via LCL (Less than Container Load) as the products were coming from factories in various regions of China, the UK and Korea. We were able to organize quick shipment pickups from the factories, load the containers and have each shipment shipped via sea, cleared through customs and delivered direct to the Crate and Barrel distribution centers for around $3600 per shipment.

 

RESULTS AND BENEFITS

If our client had shipped their first season via water, they would have spent approximately $36,000 in shipping fees, saving them $54,000 that season. Moving forward, we were able to negotiate with Crate and Barrel to pick up their orders FOB, which saved our client all of the international shipping fees equating to approximately $100,000 per year in savings.

 

“'Tis the worker bee back at the hive that makes the world sweet with honey.”

   

© 2020 by Back at the Hive 

San Francisco, California

- author unknown