The Impact of Mideast Tensions: Five Ways to Protect Your Enterprise

Spend Matters welcomes another guest post from NPI, a spend management consultancy, focused on delivering savings in the areas of IT, telecom, transportation and energy.

In Q2, NPI estimates that the impact of Mideast tensions will weigh heavily on enterprises. As the cost of fuel increases and price volatility continues, the entire supply chain -- from shippers to consumers -- will feel the pinch. While it will be next to impossible to fully negate the impact of increased shipping rates and surcharges (click here to learn more), there are several things shippers can do to lessen its effects:

  1. Understand what you're paying for fuel and make sure you're paying a fair price. Achieving fair pricing is fundamental to keeping transportation costs under control.
  2. Consolidate shipments, switch modes. If you can consolidate the number of shipments, explore different modes and recalibrate recipient expectations, the savings will be powerful.
  3. Understand the services you're utilizing. Why ship a package via next day air, when it can get there via next day ground at half the cost? Better understanding of the services you use may uncover no-brainer cost-saving opportunities.
  4. Keep an eye on carrier capacity, and get ready to renegotiate. NPI predicts carrier capacity will soon increase, effectively putting the pricing in your current contract above fair market value.
  5. Offset price increases outside of transportation. Offset cost increases in shipping by reducing costs in other complex spending categories, like technology, telecommunications and energy.

-- John Haber, EVP of Transportation, NPI

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