The shipping structure of your business plays a crucial role in your profitability. Most business merchants find it daunting to plan their shipping strategies. Figuring out the most convenient and pocket-friendly shipping system for your business needs a little planning and brainstorming.
If you are not careful while planning your shipping process, it can negatively impact your business functions. One of the popular shipping strategies that eCommerce merchants find effective in reducing costs is zone skipping. It is a feasible and convenient option for the new eCommerce businesses that are just starting out.
Let’s find out what zone skipping is and its strategy in the next paragraphs.
What is Zone Skipping?
Zone skipping is a shipping technique where many packages are delivered through truckload(TL) or less than truckload (LTL) shipments to zones regional to the destination of the parcels. This process helps in reducing shipping costs in some cases and is convenient.
Packages are divided based on geographical shipping zones and sent to a common fulfillment center. They are then picked up by a local carrier hub and delivered to their destination.
Shipping zones are divided based on their geographical location that ranges from Zone 1 to Zone 8 to simplify the domestic shipping process in the US. The zones are arranged according to the distance from the point of origin with zone 1 being the nearest to zone 8 being the farthest.
Let’s understand it better with the help of a table-
|Shipping Zones||Distance between origin and delivery point ( in miles)|
Please note that it is wise to consider zone skipping only when the total cost of TL and LTL shipments plus the local delivery costs are less than the total delivery costs from your origin point to the delivery point by a shipping carrier. Therefore, make the calculations before blindly reaching your decision and choose the most feasible delivery method.
Why is Zone-Skipping one of the best shipping techniques?
Finding the most convenient form of shipping that is both fast and cheap can be stressful for merchants. But it is not as difficult as it is perceived to be. You only need to do a few careful calculations before finalizing your shipping process.
Merchants worry about most while considering a shipping option if their shipments will reach the destination on time. Another crucial factor for determining the shipping options is the costs. As such, a merchant will choose an option that is the most reasonable and cost-effective.
The idea of zone skipping has arrived as a savior for merchants. It is an effective shipping technique that most e-commerce merchants use to reduce shipping costs and deliver packages just in time.
When you list out the zones for shipping, ensure to list out the most suitable ones for zone skipping. You may have to rely on data analytics to confirm your decision and not on arbitrary judgments. Also, consider if enough shipments are going in that zone to opt for this process. If the number of shipments is less, it will not be wise to use a truckload service, as most of the cargo space will be empty, which may lead to losses.
If you opt for a carrier service to move goods from the point of origin to the destination, they will charge you on a per-package basis. The calculation of the charges is based on the weight, dimension, and distance of the packages, and as such all of them have different charges. While with the practice of zone skipping, a total amount is charged on the truckload service as a whole that may include loading/unloading and transportation fees.
You don’t have to worry about the weight of your packages as long as they fit in the vehicle. It is also a way to ensure fast delivery service. Once you load the packages in the truck, you are sure that they will reach the shipping zone at the same time. Once your packages arrive in the shipping zone, they are sorted in the local fulfillment center. A local carrier service then deliver them individually to their destination.
There is also an added advantage in the form of easy tracking with the practice of zone skipping. You don’t have to track your items individually. You can simply track the location of your vehicle and know where your packages are. This can help you save some time which otherwise can be a lengthy process.
The shipping strategy of zone skipping can further help you take advantage of the regional carriers and their affordable rates. National carriers tend to be on the heavier side of expenses. With the practice of zone skipping, you have the opportunity to explore different regional carriers and their services. You can take your time to test the compatibility of their services with your business and settle with the best one.
Cost Saving through Zone Skipping – What is the scenario like?
The practice of zone skipping is popular because of its cost-effective nature. Merchants want to keep the shipping expenses on the lower side of their business activities. As such, they are constantly looking for new ways and strategies to reduce shipping costs.
Zone skipping found its way to the good books of business merchants because it gives them what they were always looking for – fast delivery service at a lower cost.
But how are they cost-effective? Let’s understand it with the help of a simple example.
Maria is shipping 3000 parcels from point A to point B. The flat-rate cost of each parcel is $10. The shipping carrier will deliver her parcels directly from the point of origin to the destination. The total cost comes up to $30000.
But Maria is smart, she decided to weigh down different options before finalizing her decision. So she contacted a truckload service and asked for a quote for the shipments to be delivered to a sorting facility in point B. The price quoted was $5000.
Maria was happy and was satisfied with the price. She almost jumped around with joy. But then a thought struck her mind. Who is going to deliver the parcels to their individual destination once they reach point B? Maria almost forgot to consider this.
Without wasting any time, she searched for the regional delivery services in Point B. After speaking with 2 to 3 carrier services, she chose a carrier with a flat rate of $7 per package to deliver the packages to their final destination. This time Maria didn’t forget to do the final calculation. It was $5000 + (3000x$7)= $26000. That means she would save $4000 if she opted for a zone skipping technique.
Maria could finally jump around freely with joy.
4 Key points of Zone Skipping
After all the discussion we had about zone skipping, you might have already figured out what it is all about and how it can help your business.
To make it more comprehensive for you, let’s do a quick revision.
Here are some of the highlights of zone-skipping
Cost-effective and speedy
We have already spoken multiple times about how zone skipping can help your business save money with this practice. We also learned how you can save money with a simple demonstration from Maria. Apart from being cost-effective, zone skipping has also a reputation for being speedy.
Zone skipping helps you to consolidate your packages and send them all together to shipping zones. This process can help you save a lot of time during the initial phase because you don’t have to weigh and pay for individual packages. You can just load the shipment and send them off to the fulfillment centers and the staff there will take care of it.
Utilization of regional resources
Zone skipping helps you explore different carrier options regional to the shipping zone. Regional carriers generally have fewer shipping charges than national ones. That is quite a smart way of escaping the costs of giant shipping carriers.
As already discussed, zone skipping simplifies the process of tracking. All the packages in the cargo can be tracked at once. It can enhance the process of your delivery experience management.
Though zone skipping comes with a lot of benefits, it may not be feasible in every situation. Before considering the practice of zone skipping, ensure to consider the crucial factors impacting your decision. Please ensure to list out all the shipping zones and use zone skipping for only those areas which are suitable. Also, don’t forget to compare costs and carrier options before finalizing your decision.
We have tried to present a comprehensive guide on zone skipping, and its shipping strategies Don’t forget to keep in mind the important points while making your decision.
We hope the concept of zone skipping is simpler to understand at this point. It is time to make the most of this concept and add it to your existing shipping strategy. This strategy can not only save a lot of costs but also expedite your existing shipping process.
Start executing it at the earliest and you’ll see the difference. We hope it helps.