The True Cost of Manual Processes When Shipping – Analysing Hidden Expenses and Savings

Shipping costs extend beyond the tangible expenses —carrier fees, packaging, and transportation. But do we consider the intricacies of manual processes that actually reveal the true cost of shipping? It’s these hidden expenditures that can have a significant impact on operational efficiency and profitability.

The time-consuming nature of manual data entry, label printing, and documentation preparation go beyond the obvious financial outlays. These seemingly admin-heavy tasks that usually rely on people, when multiplied across numerous shipments, accumulate into substantial hidden expenses that can erode both time and resources.

So what do we measure when it comes to shipping costs?

Logistics professionals are well-versed in the tangible side of the shipping equation – the clear, upfront costs that shape budgets and impact profitability. These direct expenses, while seemingly straightforward, can be surprisingly nuanced:

• Carrier Fees: These are dynamic and subject to change based on the number of shipments, package dimensions, weight, speed requirements, and destination.
• Packaging Materials: The selection of packaging materials, encompassing robust boxes, protective cushioning, secure tapes, and labels, exerts a substantial influence on overall costs.
• Customs and Duties: Crossing borders introduces complexities, involving customs duties, taxes, and potential clearance fees.
• Insurance: Serving as a protective measure against potential loss or damage during transit, the cost of this safeguard necessitates careful evaluation against the risk profile of shipments.
• Technology and Software: Investing in efficient systems like carrier integrations, label printing solutions, and advanced tracking tools is crucial for process optimisation. However, striking a balance between technological advancements and cost-effectiveness remains a significant challenge.

Mastering these direct costs is the foundation of sound pricing models, competitive advantage, and ultimately, sustainable profitability. But we know these visible costs are only one facet of the larger shipping cost landscape. So what of the unseen costs? 

The Unseen Costs of Manual Shipping Processes

Monetising time, as the age-old saying goes, isn’t always immediately apparent, especially in shipping costs. Time wasted equates to a financial loss, making it crucial to recognise its value and address its efficient use. Unseen costs, often overlooked, play a significant role in eroding profitability and operational efficiency. 

While visible costs like carrier fees and packaging materials are apparent, hidden factors such as manual processes and operational delays can quietly impact the overall budget. Let’s explore: 

• Manual Data Entry: Manually entering shipping information for each package is a hidden cost. This process is not only labour-intensive but also prone to errors, leading to potential delays and additional expenses in rectifying errors.
• Label Printing and Documentation: Printing shipping labels and preparing necessary documentation for each shipment may seem routine, but the cumulative time spent on these tasks per shipment can add up, impacting overall team productivity.
• Staff Time: Beyond the tangible costs, the time spent by staff on repetitive and manual shipping tasks represents an often underestimated expense. This staff time could be redirected towards more strategic and value-added activities.
• Operational Delays: Inefficient shipping processes can result in delays, affecting order fulfilment timelines and customer satisfaction. The cost of these delays, both in monetary terms and brand reputation, is frequently overlooked.
• Error Corrections: Addressing errors in shipping information, whether due to manual mistakes or miscommunication, requires additional time and resources. These corrections contribute to hidden costs that are challenging to quantify.

Recognising and mitigating these unseen costs is crucial for businesses aiming to enhance their shipping operations. The move towards automation and streamlined processes can uncover these hidden expenses, offering opportunities for cost savings and improved efficiency. 

Unveiling The True Cost Of Manual Shipping Processes With The OneShip™ ROI Calculator

Now that we have uncovered these covert costs, let’s shed light on the transformative potential of streamlined shipping solutions. Specifically, we’re going to explore how OneShip for NetSuite can help you save money by improving time consuming processes by using the OneShip ROI Calculator—an invaluable tool designed to quantify the efficiency gains and cost savings achievable by adding OneShip to your NetSuite platform. 

Imagine a scenario: Beauté, a fictional cosmetic brand dedicated to next-day delivery, grappling with inefficiencies in their shipping process. Frustrated customers and a backlog of orders threatened their customer-centric reputation. Determined to unearth the true cost of shipping, Beauté embarked on a meticulous analysis, revealing a critical bottleneck: labour-intensive label creation and documentation.

• On average they ship 150 orders a day.
• The average labour cost of labour per hour is £16
• They spend on average 180 seconds (3 minutes) to produce a shipping label – per package
• The current cost per package is £0.80
• The current labour cost per year to Beauté equates to £31,200

Beauté is currently exploring a shipping solution that seamlessly integrates with the NetSuite platform. To gauge the potential improvements in manual processes, they utilise the OneShip ROI calculator, inputting their key costs.

With OneShip they can:

• Reduce the average time spent on label production to 4 seconds (from 180 seconds) – per package
• Reduce the labour cost per package to £0.02 (from £0.80)
• Reduce the labour cost per package to £693.33 (from £31,200)
• Save 254 Annual Days Labour across all Carriers

While Beauté may not be a real company, the challenges and solutions presented are all too real for many companies. See the savings yourself – Fill in our quick ROI form to receive your free calculation of savings!

OneShip has helped companies improve processes, save time, save on costly integrations and improved customer satisfaction. Read our collection of case studies.

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