22 MiMfg Magazine May / June 2022
Premium Associate Member
Navigating Supply Chain Issues :
Cost Saving Measures for Improving
Your Transportation Costs
By Dave Nielsen • Maner Costerisan
How many times have you opened your computer to read another article about a port lockdown or a bridge shutdown ? The news impacting the transportation of goods is endless . Prices are increasing exponentially , and carriers are taking hard stances , passing rising costs to their customers . A nationwide labor shortage is directly impacting manufacturing goods , not to mention the availability of parts . Demand continues to grow in all sectors , with expectations mounting around faster delivery times and two-day shipping . Oh , and consumers also want to know exactly where their package is at all times .
It sounds like a pandemic ( pardon the term ). Still , after nearly two years ( or more !) of managing these disruptions , manufacturers are beginning to take a different approach to how they respond to supply chain challenges .
What can a company do to stop reacting to the latest issue and take control ? More than you may think . Often , when business gets busy , it ’ s easy for manufacturing leaders to avoid the situation and think , “ I ’ ll deal with X problem tomorrow .” As a result , we tend to put off dealing with supply chain issues until some point in the future when we aren ’ t so swamped with the daily grind .
However , steps can be taken to control transportation costs , strengthening a business ’ position and providing more visibility into its supply chain . Additionally , the added visibility can ensure best practices are implemented , hold expenses to a minimum , and concentrate more on our core business and less on the subsequent fire at hand . How do we do this ? By investing in a plan . Developing a plan to gain control of transportation costs begins with the process of gaining control of your shipping , both inbound and outbound , and determining the best price / service balance for your business . A formal system allows you to produce all needed paperwork all at once and track your shipments in one place .
Consider taking the following steps to get started :
• Begin to audit all your bills .
• Capture the data that will make a difference and analyze it to see where you can improve operations and / or cut costs . Consider a dashboarding system that would provide this data instantly — saving your valuable time and the possibility for manual errors .
• Look at every step and each link of the supply chain for savings or possible cost avoidance . Are there alternative modes or carriers to consider ?
• Consider “ Cost Avoidance ” as a strategy if “ Cost Reduction ” is unachievable .
• Think of the bottom line . Look for opportunities in domestic transportation , rather than just focusing on international air and ocean shipping .
• Consider the use of a duty drawback specialist . They can look at a client ’ s duties paid as a whole and tailor a program to ensure refunds are
maximized to their fullest potential . 6
Dave Nielsen is a CPA and principal at Maner Costerisan , an award-winning full-service advisory and accounting firm headquartered in Lansing . He leads the firm ’ s manufacturing team . He may be reached at dnielsen @ manercpa . com or 517-323-7500 .
Maner Costerisan is an MMA Premium Associate Member and has been an MMA member company since October 1976 . Visit online : manercpa . com .