Inbound freight, or inbound logistics, refers to the part of the logistics journey that ensures materials reach a business, ready to be formed into products or shipped onwards to customers.
By contrast, outbound freight, or outbound logistics, refers to the part of the logistics journey that occurs after the product or material leaves the business and starts to make its way to the end customer.
Inbound freight typically deals with raw materials (not finished products) and involves coordinating with suppliers (not distributors, vendors, or customers).
These critical differences between inbound and outbound freight call for slightly different strategies from traffic managers when optimizing their handling. Doing so can help streamline business operations overall and increase the efficiency and ease with which your inbound freight arrives and gets stored at your business.
This article will outline four tips for traffic managers to optimize the handling of inbound freight.
Let’s get started.
Tip 1: Form strong partnerships with key suppliers
Strong, strategic partnerships are the foundation of a successful inbound freight strategy.
As you form supplier relationships, there are a few factors to keep in mind, including:
- Quality (indicated by endorsements, positive reviews, accolades, etc.)
- Due diligence and compliance (any legal issues past or present)
- Ease of communication (transparent communication from the outset can be a positive sign for the future)
- Location (variety in this regard can mitigate risk due to disruption)
- Environmental impact (consider utilizing a supplier environmental assessment to evaluate this)
With your key suppliers, aim to establish optimal routes that are mutually beneficial for both parties to increase efficiency and avoid unnecessary expense.
And remember: a supplier partnership is an ongoing element of your inbound freight management. Good relationships require commitment and communication beyond signing on the dotted line!
Reviewing performance on an ongoing basis and periodically checking in with your suppliers can go a long way to ensure these partnerships continue for the long term, saving you the cost and effort of changing suppliers.
Tip 2: Consolidate inbound freight shipments
Consolidating your inbound freight shipments where possible is an excellent move to decrease the cost and time associated with managing and receiving your inbound freight.
While this point might sound obvious, a certain comfort with an existing setup can sometimes lead to consolidation not being carried out – even when the impact could be significant.
Less-than-truckload (LTL) shipments can be combined into a single truck, simultaneously increasing the speed, cost, and efficiency of utilizing multiple smaller vehicles – or worse: partially-filled vehicles.
While this tip may require a level of coordination with your chosen suppliers and transportation agents, inbound freight consolidation can reap a range of benefits, including:
- Reduced transit times
- Greater transportation visibility
- Reduced fuel use and emissions (and environmental impact)
- Fewer opportunities for damage to occur
- Pricing simplicity
- Reduce congestion at loading docks
Tip 3: Implement Vendor Inbound Compliance Standards (VICS)
Vendor Inbound Compliance Standards (VICS) are guidelines for suppliers working with your business.
Implementing VICS can significantly optimize and streamline your inbound freight processes and tackle any problematic supplier behavior.
Once you’ve established your VICS, you’ll want to communicate these with your regular suppliers and have them sign-up to abide by them.
Having set standards in place will go some way to improving your inbound freight processes, but in the case of the VICS not being met, you’ll also need to ensure you enforce them. To do so, you may want to start by estimating the cost of supplier non-compliance for your business and then creating appropriate penalties in line with this. Next, you’ll want a transparent monitoring system to ensure you’re keeping up with regulations.
Ensuring inbound freight standards are clear is a crucial part of maintaining strategic relationships with your suppliers that will help minimize risk, waste, and unforeseen expenses.
Tip 4: Develop strategic relationships with high-quality third-party providers
Using third-party logistics services for some (or all) of your inbound freight requirements can be an intelligent way to optimize the efficiency of these processes in a cost-effective and scalable manner.
Key benefits of coordinating with a third-party provider include:
- Industry expertise and experience at your fingertips
- Access to lower shipping rates (due to high volume discounting)
- The ability to quickly scale your operations
- Access to updated warehousing and logistics technologies
- In-depth knowledge of legislation, compliance, routing guides, and more
While these benefits are valid for whichever element(s) of your supply chain you choose to outsource, this can be a beneficial strategy for inbound freight.
Well, that’s because partnering with a third-party provider for your inbound freight needs makes it easier to implement the previous tips we’ve outlined in this article: forming solid partnerships, consolidating freight, and implementing VICS.
It’s often far easier to navigate a single relationship with a trustworthy, industry-leading third-party provider than to manage numerous contracts with smaller suppliers with varying standards and regulations.
If you’re looking for a partner that provides that expertise without sacrificing the friendly feel of your smaller suppliers, then Jansson is your logistics solution.
For next-level inbound logistics you can count on, choose Jansson
We at Jansson are proud to provide logistics support and transportation you can count on.
With over a decade of experience and an extensive network of third-party transportation and warehousing suppliers, we can offer you the best domestic and global logistics solutions.
If you found this article useful, you might also be interested in “10 Good Procurement Habits for Traffic Managers”, which you can read right here on The Logbook by Jansson. For a free quote or to find out more about the value we can provide, reach out to Jansson today.