Cost Saving Strategies For Growing Brands
- Many brands start out shipping from one location. This a great for lower volume brands, as there are inventory and processing considerations that make this the right choice. At some point, however, your growth may lead to cost-saving opportunities, from a postage perspective, that will warrant fragmenting your inventory and shipping from different geographic locations within the country.
- Postage costs are essentially a blend of two different factors. Weight and distance. While worthwhile savings can be achieved by managing weight, distance is the next threshold of savings opportunities.
- If you are only located on the east coast, about a third of your parcels are traveling all the way across the country, driving up cost and transit times. 2/3 are doing the same if your presence is solely on the west coast.
- Shipping from both sides of the country is therefore the first step toward reducing costs and transit times, regardless of carrier selection (USPS, hybrid, non-USPS).
- Multi-node shipping, as this is called, also allows you to access a diversified shipping portfolio, rounding out your mainstay parcel network with niche players.
- An east/west model depicted below, optimizes speed and cost for brands that are scaling up and have solid supply chains.
