As you know, manufacturing is heavily reliant on transportation, and as the industry continues to see those costs rise, the effect transportation has had, accounting for nearly 40-50% of a company’s total manufacturing overhead, can massively affect your bottom line as a business.
Here at Reynolds Machinery, we work with many international machine tool companies, including Hurco and Okamoto, which means we manage both international and domestic transportation costs in order to deliver high quality machines to our customers.
Throughout the last decade, freight transportation costs have steadily been increasing. Increases in oil prices, specifically diesel, as well as supply-demand imbalances have led to serious issues in congestion, capacity constraints, and efficiencies in cost at the ports and transportation centers.
Our relationships with our customers are key and crucial to our business, and we want to see you succeed and optimize your budget for planning, even when costs like delivery and transportation can’t be predicted.
Although the cost of fuel took a dip in 2020 due to the COVID crisis, this did not provide relief as the pandemic resulted in massive transportation and delivery delays. Consumer demand increased dramatically, which resulted in major slow downs as transportation companies were unable to keep up.
As a supplier to your business, but also your partner, we are keeping our eye on current events that affect your transportation costs.
The rise in transportation costs has made freight movement a moving target. While we at Reynolds work with our builders to optimize transportation costs and keep freight costs as low as possible, we are still seeing steady rises in shipping costs, adding to the costs of machines as they come into stock.
For example, when the Ever Given mega-ship blocked traffic in the Suez Canal in March 2021. This triggered a surge in shipment container freight rates, which the manufacturing industry had to quickly adapt to.
To top it all off, transportation rates are increasing as the number of truck drivers is decreasing over time. And fewer people are applying to these positions, which has led to a struggle in finding qualified drivers at efficient labor rates.
We continue to work with our customers proactively so they can stay ahead of changing trends and unpredictable costs.
Our customer service is more than just a friendly face. We work with clients on best practices, training, DIY Maintenance and service opportunities to keep your machine floors running at optimal productivity with the machines you have. And when it comes time to add a machine, we work with you to make sure you’re taking advantage of the best opportunities available for your business.
At the end of the day, it’s relationships that we have to offer, more than machines, and our goal is to keep you happy, no matter what is going on in the world outside your walls.
