Due to COVID-19, overseas suppliers have been influenced greatly. The epidemic leads to supply shortages and hinders the operation of the entire supply chain. To ensure that you can effectively transport goods across borders, what are the cross border logistics strategies?
Ⅰ. Cross border logistics strategy: build warehouses near the border
For cross border logistics, whether it is northbound or southbound, establishing warehouses near the border provides greater flexibility in managing congestion, transport time, and capacity. For example, congestion at the border can cause delays, which limit the number of truck trips per day, or even less if the driver needs to travel a long distance to and from the warehouse. If the warehouse is located near the border, even if there is congestion, the number of potential cross border movements will increase. Shorter distance also means shorter transportation time, thus realizing on-time cross border logistics. In addition, strategically placed warehouses can serve as distribution centers.
Ⅱ. Cross border logistics strategy: cooperation and transportation mode
Cross border logistics cooperates with carriers certified by border protection agencies of various countries. Products can reach their destinations faster without increasing costs. Similarly, it is advantageous to cooperate with operators who have been certified by the border protection agencies of various countries and have been screened and considered to have a low risk of security issues. They benefit from fewer inspections and access to free and safe trade channels.
Determine the best transportation mode for cross border logistics according to the product. Depending on the product, it’s best to use a transshipment service. The trailer is sent to a nearby warehouse and then unloaded from one carrier in the destination country to another, or door-to-door mode, where one carrier transports the trailer from start to finish. Most companies can benefit from the flexibility of transshipment. For example, for underutilized trucks destined for Mexico, the warehouse can be used as an integration point to consolidate the goods into one trailer. For trailers destined for the United States, the products can be unloaded and placed on different carriers, thereby creating a hub-and-spoke model, minimizing costs and alleviating tight truck capacity. For time-sensitive products in industries with strict regulations, such as medicines or certain foods, home delivery is usually the best and only option.
Ⅲ. Cross border logistics strategy: use transportation management system
Cross border logistics uses transportation management systems. TMS provides enhanced visibility, can help monitor load and KPI, and can find ways to optimize network transportation. Real-time cross border logistics information helps to identify opportunities for dynamic route improvement, trailer space utilization, and cost. The best suppliers can implement effective strategies to optimize your cross border logistics and ensure the seamless cross border flow of your goods, allowing you to focus on your core business.
