Why the Shipping Costs Still Going Up?

Why the Shipping Costs Still Going Up?

We all have been witnessing a remarkable spike in the shipping cost. Do you want to ship lightweight or heavy materials? Well, the overall shipping cost is at its all-time high.

Thus, you may need to spend more than what you used to spend a few years ago.

At the same time, container shortage is also posing a significant challenge. As a result, we can see the falling supply chains. Moreover, many businesses are shutting down their operations.

Among all industries, the auto and manufacturing sectors are facing a substantial loss.

So, what led to this sudden spike in shipping costs? Are there any ways to improve the current scenario? Let’s analyze!

When Shipping Cost Started Going Up?

Shipping costs were average until the closing months of 2020. Besides, there was a slight increment in the price. It was, of course, expected. That’s because the pricing changes each year.

But, it took the autumn of 2020 to give us the real ‘affecting’ price. So, a sudden rise in the shipping cost was surprising. Moreover, the beginning of 2021 set a new surge in rates.

The market can accept a slight change in the pricing. But it can never endure a sudden, huge spike. So it won’t be wrong if we say the shipping costs are so high these days- almost tripled.

That’s the reason why many companies are looking for alternative methods to ship products. Yet, they cannot figure out any viable solution.

That’s because many operations involved in the shipping business rely on a supply chain. And since each element of this supply chain is charging more, the shipping costs are reaching a new height.

Why Shipping Cost Started Going Up?

There can be several reasons behind this rise. But, we cannot handpick a few issues and state them to be the sole cause.

Here are some of the notable causes behind the rise in shipping costs.

A. The Covid-19 Pandemic

Like all other sectors, the Covid-19 pandemic has affected the shipping industry too.

Increased pricing is merely one of the factors that we get to see. But this pandemic gave us several unforeseen consequences. Now, businesses need to face delays in product shipping, waiting for shipment approval, and many other issues.

Oil prices play a significant role in the shipping industry. Yet, many oil-producing countries decided to slow down oil production because of the pandemic.

As a result, it created an imbalance in the oil prices. You can understand this point if you know the demand-supply calculations.

In the end, the shipping service providers had no choice other than to increase their shipping costs.

B. Brexit

Many shipping companies claim that they are facing so much cross-border friction after Brexit. This point may deem less critical, but it still is noteworthy.

Suppliers who ship their goods from or to the UK can experience the price difference.

C. Other Factors

Some issues, such as last-minute cancellations or diversions, can lead to miscommunication. In addition, many big corporations increase their costs to recover losses.

Thus, the transportation sector also needs to increase the pricing. As a result, the overall market rates inflate and expand.

When Will It Improve?

Of course, there is no quick fix for this collapsed supply chain. Market analysts believe that the shipping costs will remain at this peak during 2021. After that, it will take time to return things to more manageable levels.

Businesses affected by this price inflation should work at lessening their shipping costs. In addition, they can work on restructuring their supply chains.

What Can We Do for Our Clients?

We understand that increased shipping costs are affecting our client’s business. Thus, we are taking small yet practical steps to help lessen their burden.

1. Finding Reliable Shipping Companies Online

You can tell us how fast do you need the product. After that, we can find a suitable transit method to ship your goods. It can be one of these options:

What’s more, we will also check online shipping companies offering the best deal. Then, we will compare their pricing on your behalf.

In this way, we will help you choose the correct transit method and a suitable shipping company.

2. Visiting the Shipping Company

We can believe in shipping companies most of the time. Yet, it is essential to visit their office and cross-check their offer.

So, after finalizing the shipping company, we will visit their premises to ensure their reliability. We will get an estimate on how long it will take them to ship your goods. Besides, we will also ask for a reasonable price.

3. Negotiating the Price

Shipping costs are touching the sky these days. Now, you know the reasons why the prices are too high.

Nevertheless, we will make sure you get the best deal on shipping your goods. For this reason, we will contact multiple shipping service providers and compare their pricing.

We will also negotiate the shipping cost so that it can meet your budget.

4. Ensuring a Proper Packaging

Packaging plays an essential role both for safety and shipping costs. Moreover, it also improves your brand presence.

Many business owners face a overweight and overbig  Packaging. That’s why we offer custom packaging to our clients. You can tell us what kind of packaging material you want. It can be a zipper bag, box, bubble envelope, or any other material of your choice.

We will ensure the packaging material is protective,  lighter and smaller. What’s more, you can also add your logo to the packaging.

Lighter and Branded packaging will make your product look more professional. Besides, your customers will also have an cost-saved shopping experience.

5. Shipping and Tracking Your Order

After passing all these essential steps, we will ship your goods to your preferred address. We will inform you once we dispatch your order.

Moreover, we will also share the tracking number with you. It will help you track the delivery status of your goods.

If the product delivery delays or comes across any issue, we will contact the shipping company. We will resolve the issue and confirm that the product reaches its destination.

Final Thoughts!

As you can see, many factors contribute to the rise in shipping costs. Unfortunately, these factors are beyond our control. Let’s hope that the shipping cost will settle on its average value by the end of 2021.

The only step one can take at this time is waiting for the shipping costs to come down. Till then, every business will have to find alternatives that can save a little bit on shipping.

We understand the pain of businesses that solely rely on either importing or exporting products. Thus, we are offering some additional services to our clients, which we have already discussed in the above section.