A liquidation pallet can unlock exciting opportunities for your reselling business and can even add the fun of a mystery haul. To protect your bottom line, though, it's important to factor in the costs of getting that great new pallet to you. In this guide, we'll break down what can change your shipping costs and how to ensure you get an ROI that will keep your accountant happy.
What Factors Affect the Cost of Freight
What Factors Affect the Cost of Freight
There isn't one standard cost for freight, and it will depend on several factors:
- Distance: The obvious one; the further you're shipping items, the more expensive it will be. Difficult terrain and a remote destination will also add to the cost.
- Method of Transport: Air freight will be the most expensive option but is the quickest option, so great for high turnover businesses. If you don't mind waiting, sea freight is cheapest. Depending on the distance, road or rail is an average option.
- Weight and Size of Goods: Heavier items cost more to ship due to increased fuel and labor costs. Larger items will also cost more even if they're light due to the size needed.
- Market Changes: There will always be fluctuations outside your control, so make sure you have a bit of room in your planned budget. For example, global oil prices can impact fuel costs, and an unexpected rise in demand could increase costs.
LTL vs Full Truckload Delivery
LTL vs Full Truckload Delivery
By road, freight is broken down into two main categories:
- LTL: Meaning 'Less-Than-Truckload'. Costs are lower because you only pay for the space your items take up, but delivery times are usually longer as the truck is doing multiple deliveries.
- Full Truckload: You pay for the sole use of the truck. This option is obviously more expensive but is generally a better per-unit price for larger shipments and is faster.
Warehouse Pickup vs Shipping
Warehouse Pickup vs Shipping
Warehouse Pickup
Warehouse Pickup
This option is available from many liquidation pallet suppliers , and you will likely be given an allocated time to arrive and load your items. This option saves money and means you can get your stock immediately but requires significant time investment as you'll be placing everything inside the vehicle yourself, plus travelling time. You'll also need to factor in maintenance of an appropriate vehicle as it will now be doing more mileage.
Shipping
Shipping
Many businesses prefer this option because of the convenience, as you won't need to spare any staff to load the items or run and maintain the required vehicle. This way also gives you the ability to source from any warehouse even if they're not local to you. With this choice, you do of course have to factor in the additional costs of shipping though.
Don't Forget Your Unloading Equipment Needs
Don't Forget Your Unloading Equipment Needs
Many long-haul freight companies will unload your truck for you when it gets there. For some smaller jobs though, or in circumstances where the shipping company is concerned about insurance, you will need to unload the pallet when it comes. Depending on the weight of the pallet, you'll need a manual stacker or a forklift. You'll also need to ensure anyone unloading has the right health and safety training to do it safely.
How to Budget Freight Into Your Total ROI
How to Budget Freight Into Your Total ROI
As we've shown here, freight costs are variable. It's important to consider this when budgeting, as considering freight as a static fee could lead to budget shortfalls or a lower return. Changes in fuel costs are the most likely change where freight is concerned, so ensure you perform a couple of examples of costs. You can then compare these to the expected income from the pallet contents to help work out anticipated ROI.
Now you've learnt the ins and outs of freight and what to expect, browse our range of pallets from Quicklotz now.
