When sending goods, it’s no secret that costs can soon add up. Especially when your business relies upon the distribution of commercial goods. Naturally, this leads most business owners to ask how they can make this more cost-efficient.
When looking for a new haulage partner to help transport your goods, there are lots of different things to consider, but one key difference is whether they are part of a pallet network or use direct transport.
Here, we’ll look at the difference between the two and try to find out; if using a pallet network is a cheaper way to send a parcel.
What is the Difference Between Direct Transport and Pallet Networks?
The key difference is the fact that pallet networks are organisations of hauliers that work together to provide quick and efficient distribution solutions.
However, direct transport means that your chosen logistics company does this themselves, keeping the goods in-house and with their drivers.
For more information on how pallet networks work, you can take a look at our handy guide here.
Maximising Cost-Efficiency in Haulage
Reduction of Empty Miles
As the name suggests, a pallet network is, in fact, a network of qualified drivers. It is this network that means they can reduce the miles driven with empty cargo. They can do this because once they’ve dropped a shipment off, they can pick up another nearby and help others in the network at that location. It also gives them more flexibility when offering delivery options.
It’s this flexibility that allows them to deliver more goods in a day, ensuring the pallets get to their destination quickly and efficiently. This can help businesses get more for their money and enhance process times.
However, in direct transport, once a driver has unloaded the goods, they’ll make their journey back to the depot. This isn’t necessarily a bad thing, as the business will have planned for this for time management, but the reduction of empty miles with a pallet network means it’s more cost-efficient for businesses; and therefore may be a cheaper way of sending a pallet.
Operational Costs
The cost of transportation isn’t always the cheapest, that’s why it’s important to try and look at cost-effective ways to balance them out. A pallet network will share its costs over the network involved in the delivery, which includes vehicle maintenance, fuel, and much more. These savings can potentially be passed on to their clients, so they are more likely to see cheaper prices with a pallet network.
On the other hand, direct transport only pays for its own costs, so whilst there are no shared costs, it means that it’s only its own maintenance, fuel and fleet that they are funding which makes it slightly more expensive.
Environmental Benefits
Because direct transport doesn’t pick up additional jobs, depending on if the journeys are long or short haulage, it can affect their carbon emissions and their impact on the environment. If this is something you take into consideration when deciding what method of transportation to go for, it may be worth asking how the company manage their carbon output.
In contrast, due to the shared operational costs and the network of drivers, pallet networks use less fuel and lower carbon emissions. This is an added benefit to the industry as a whole and can be the difference for some businesses when choosing a partner. Overall, pallet networks are able to provide more long-haul journeys, spread the cost across the network and lower emissions. This can result in a more cost-effective solution for you and your business.
If you have any questions on pallet networks and how they work, please don’t hesitate to get in touch with Cross Country Carriers who would be happy to help.
