CASE STUDY: HOW GO DIRECT HELPS REDUCE THE COST OF SALES

Have fuel costs, supply chain complexities, and cross-border challenges taken a chunk out of your business’ margins? Read our case study on how Go Direct proactively works with our clients to find transportation and inventory solutions that work for their bottom line.

THE CONTEXT
Logistics is the backbone of any online seller’s success. But are your shipping and fulfillment costs killing your brand’s bottom line? Consider this: according to the 2021 State of Logistics Report, spending on parcel-delivery services for ecommerce brands jumped nearly 16%; and overall transportation costs soared past 10% of the cost of sales.

If your business ships through small parcel delivery services like the USPS or Canada Post, you know that these costs can really dig into your bottom line. Plus, as your brands grow into larger retail outlets, many of them have specific Routing Guide Requirements which require new packaging and shipping processes. Not to mention as your customer base grows, so does the mileage (and fuel!) to reach them. How can you scale your business but keep your costs of sale in check? And most important, is your current 3PL meeting these challenges for you?

THE PAIN POINT
Go Direct is committed to going above and beyond for all our Partners. With the increasing complexities and costs emerging from the pandemic and hitting the supply chain on both ends, we knew we had to be aggressive offsetting these rising costs.

Unlike other 3PLs, Go Direct doesn’t just pass along the rising costs to our partners, we analyse and identify ways to drive cost improvement. For our client in this case, a major home and garden distributor, we proactively:

1. Planned and executed a growth strategy to increase reach and inventory efficiencies by opening new locations across Canada and the United States including a brand new state of the art facility in Calgary Alberta.
2. Conducted a pro-active, thorough business review and analysis of transportation costs for our clients to find efficiencies and improve solutions to their B2B and D2C fulfillment pain points.

We recognized early that increases in fuel costs coupled with market expansion meant obvious increase in the cost of sales for the client.

FIND OUT ABOUT GO DIRECT’S CALGARY ADVANTAGE

THE SOLUTION
First, we were able to pro-actively identified our client’s key pain points in the context of the supply chain crisis:

• Globally skyrocketing small parcel and LTL shipping costs.
• Meeting B2B Routing Guide Requirements.
• Increasing geographic reach and speed-to-fulfillment, without increasing mileage costs.

Second, our commitment to exceeding expectations and regularly reviewing our best practises ensure we provide our client with demonstrable forecasted improvements and the best costs to their bottom line.

By providing flexible inventory locations across Canada and the United States, Go Direct is able to reduce mileage-to-delivery, while improving speed-to-fulfillment. With our cross-border capabilities, cross-facility inventory management and reporting platform – ACCESS GD – and our commitment to going above and beyond for our clients, ask us how we can help solve your Brand’s pain points.

THE RESULTS
With approximately one quarter of their sales being delivered to Western Canada, our business review determined that by flexing inventory to our Calgary location, we could forecast for an immediate transportation cost savings of ~30% per package* (*savings dependant on parcel sizes and weights).

We knew we could also improve the speed-to-fulfillment immediately by leveraging our Calgary Alberta facility to strategically locate our clients’ products, seamlessly meeting their increasing western regional demand. Go Direct’s Calgary facility provides 24 – 48 hr fulfillment windows for over 90% of western Canada and western and southwestern United States.

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Is your Brand looking for an edge to reduce the cost of sales? Go Direct can help. Drop me, Rosalyn Devlin, a line and let’s set up a time to talk about your pain points and how we can solve them!