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There are huge benefits that people can benefit from when using Outsourcing Transport services, which made using these services a smart move that any company can accept. The importance of using Outsourcing Transport services has emerged during the Covid-19 pandemic, which has caused business disruptions around the world, and the problem has been exacerbated by a severe drop in demand for products. As a result, supply chains are severely disrupted, so various companies are in dire need of providing more flexible supply chains.

Thus, the ability to adapt and expand quickly according to individual and geographic needs, and this is what Outsourcing Transport can provide. In today’s article, we will discuss in detail what Outsourcing Transport is, its most important benefits, and how diggipacks can help you provide the best services at great prices.

What is Outsourcing Transport Freight?

Before we talk about the benefits of Outsourcing Transport Freight we will first need to know what it is.

As it refers to the agreement made under which one company appoints another company to be responsible for the activities related to the various freight forwarding operations.

This saves her time, effort, and costs, and helps her focus on other more important tasks that help the company grow and expand.

Five Benefits of Outsourcing Transport Freight

There are a number of benefits that companies can gain from using Outsourcing Transport Freight, which will keep them moving in the right direction.

Especially since the well-managed the transportation services in any company or online store, the more positively this affects the performance and presence in the market.

This is what Outsourcing Transport Freight can provide, and the following are the most important benefits that can be obtained from using these services:

1. Economies of Scale

The main benefit of using Outsourcing Transport services is the provision of huge economies of scale, due to a stable customer base and therefore significant purchasing power.

All this makes pricing highly competitive, so external sources such as 3PL and 4PL companies are able to plan and negotiate better and more effectively.

As well as their ability to apply the latest technologies, which means reducing the investment costs of the company and focusing on tasks that help them expand and grow.

2. Information Management

Through the use of various Outsourcing Transport services, the company can obtain real-time information about customers’ orders.

This enhances the speed of delivery of orders and their effective management, especially since the lack of accurate data means:

• Delayed delivery.
• Additional costs.
• Loss of a large percentage of customers.

But through smart systems that can be provided by third parties, companies can manage their information, and exploit it in a way that best serves customer requests.

3. Technology and Communication

By outsourcing 3PL or 4PL, the company can enjoy highly specialized transportation systems.

Through which requests will be managed and scheduled, as well as the availability of smart services such as tracking drivers and providing real-time communication, which contributes to supporting security and safety.

4. Customer Service

Another distinguishing benefit when using Outsourcing Transport services is the ability to focus on customer requests and meet their desires.

This is done in a way that achieves customer satisfaction, through accurate and fast dealing with the available information. This importance emerges in cases of pressure requests from customers.

5. Resource Flexibility

With increasing demands as well as seasonal fluctuations in demand, companies or online stores can find it difficult to manage orders.

And thus incur more high costs, but third parties can handle these matters very easily.

For example 3PLs have the necessary expertise and equipment required to provide flexibility and adapt to different fluctuations.

Key to Success in Outsourcing for Freight Logistics

Key to Success in Outsourcing Freight Logistics

If you want to succeed when hiring Outsourcing Freight Logistics, there are a number of basic things that you must consider, the most important of which are:

1. Key Performance Indicators (KPIs) and Performance Scorecards

Effectively keeping track of KPIs will help you demonstrate the success and effectiveness of your Outsourcing Freight Broker.

This is in addition to following up on financial reporting tools, thus knowing whether the external company you deal with is effective in managing your deliveries or not.

There are a number of KPIs that can tell you how effective your external company is, such as:

• Is on time delivery to customers?
• What are the percentages of delays in delivering customer orders?
• Are the cars available on time?
• Percentage of error free invoices.

2. Data Visibility is the Key

One of the biggest challenges to transport logistics in general is the inability to access accurate information in real time, and this is a huge challenge at the moment.

Especially since having a clear view is the cornerstone for the success of 3PL Logistics, through the effective exchange of accurate information in real time.

Accurate, real-time information can be accessed and exploited to support business, by providing and using appropriate technologies.

3. Building Relationships

One of the important things you need to be successful with Outsourcing Freight Logistics is to put the time and effort into developing your relationships with external suppliers.

So that the company you deal with suits the style of your company, and thus the ability to understand the nature of your business and provide the best solutions and services for you and your customers.

All of this will help you manage expectations and face unexpected fluctuations, as well as identify areas of future opportunity that are right for you.

Diggipacks for Outsourcing Transport Freight

If you are looking for the best Outsourcing Freight service provider then diggipacks is your perfect choice.

Diggipacks is one of the best companies specialized in providing logistics services, relying on the latest technologies and techniques.

Cooperating with a logistics partner can help you manage your products better, in a way that enhances your presence in the market and thus increases your sales.

Diggipacks owns an experienced and specialized team in Outsourcing Freight, which will give you the best services at the best prices and give you a comparative advantage in terms of speed and efficiency.

Digipacks can also provide you with smart storage solutions at the best prices, as it has all the spaces needed by special products, with an economical plan while ensuring the high quality of storage.

As well as full packaging services for its stored products, in addition to the ability to provide you with daily reports of your stock movement through the customer control panel.

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Recently, huge changes in shopping habits have been observed, Which has emerged in particular during the period of the Corona pandemic. That made the e-commerce process takes a new direction. All of this pushes e-store owners to try to keep pace with these changes, especially since the massive digital transformation has made consumers less tolerant than before. As the whole world changed when the digital age entered, everyone had to keep up with the constant changes including retailers. In this article, we will discuss the most important changes that have occurred in shopping habits, and how this may affect retailers.

Changes in shopping habits

There has been a fundamental change in the shopping habits of consumers, which has changed the retail industry dramatically.

And it has become imperative for owners of electronic stores and retailers to keep pace with these changes.

The following is a list of the most important changes that have affected shopping habits in the recent period in some detail:

1. What the customer wants

 The desires of customers have changed dramatically, with the massive digital transformation and age of speed we live in, online shoppers are looking for speed and reliability.

They are also becoming less tolerant and more stressed about products, delivery options, and payment methods, so e-store owners and retailers need to cater to all that customers need.

Although satisfying the desires of customers or consumers in general is not an easy thing, but at the same time it is not impossible.

Modern technology, smart tools and software have provided many ways in which customers’ desires can be better met, and in a much shorter time frame.2. Users want more flexibility and control

2. Users want more flexibility and control

One of the shopping habits that has changed dramatically with the digital transformation we’re seeing is consumers’ desire for greater flexibility and control over their buying and receiving processes.

Shoppers want to limit the time to receive the parcel, and they also want flexibility in the event of a request to exchange or postpone receiving the product.

Customers also want more flexibility and follow-up by customer service, and provide more acceptable options to satisfy them.

All of this has caused a lot of pressure on e-store owners and retailers as well, as they are spending more time and effort trying to provide greater flexibility and control for customers.

3. Users want instant customer support

One of the shopping habits that has also changed is the constant and immediate need for continuous support, so customers have come to expect customer service to answer their questions and inquiries around the clock.

This required e-store owners to try to provide customer service around the clock, with a chatbot programmed to answer most of the customers’ usual questions.

4. Direct-to-consumer (D2C)

There is huge competition for Direct-to-consumer (D2C), and that is one of the huge changes in shopping habits.

Although the retail business is doing well, this has not at all affected e-commerce sales.

Especially since a large number of consumers prefer direct dealing, so that the product reaches it directly from the producer or the factory itself without any intermediaries.

5. Traceability

Customers are increasingly wanting a feature through which they can track their shipments or orders, and that’s a big change in online shopping habits.

Shoppers feel more comfortable when they find an option that allows them to track their orders until they reach them.

It will even be an incentive for them not to abandon the shopping cart, and to continue to complete the purchase.

6. Technology steps

Technology has changed e-commerce hugely, as new technologies, such as augmented reality, have helped give customers a chance to see the item they are shopping for.

Which helps them in making their decision to buy or not, and all this enhances the online shopping experience and makes it better.

Therefore, shoppers want to provide modern technologies that help them in shopping online better.

And provide them with more options and alternatives, so that’s a big change in online shopping habits

7. The Amazon factor

The Amazon factor has greatly influenced your online shopping habits, which is basically the reason behind the success of Amazon itself.

Where Amazon relies on 3 main factors that helped its success, through which a better shopping experience is provided to customers.

These factors are the availability of different products in stock, reasonable price for the available products, as well as express delivery services.

All of these things have made customers more eager to see that these factors are available in any online store they shop from.

8. Using the drone for delivery

Due to the increasing demand of customers and their desire to provide fast delivery, customers are interested in a delivery drone, so that they get their orders as soon as possible.

What do these changes in shopping habits mean for retailers?

All these huge changes in shopping habits indicate that retailers should try to make shopping easier for consumers.

Such as trying to provide their products through an online store, thus making it easier for customers to communicate with them and reach them.

As well as trying to take advantage of smartphones and voice search services to their advantage, which will reflect positively on their presence and sales in the market.

Especially since nowadays, most shoppers are using the Internet through their smartphones to purchase the products they want.

So retailers should try to take advantage of all these changes to their advantage, and try to provide the ingredients that keep them ahead of the latest changes to take advantage of them.

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With accelerating customer expectations about services offered in e-commerce, problems with WISMO, which stands for “Where Is My Order?” has arisen. The term WISMO expresses all inquiries received from customers, and all such requests can be handled in more than one way. Examples of ways in which WISMO can be handled are emails or chatbots, other interesting and many more ways. In this article, we will show you what WISMO is, as well as how to best manage it to achieve customer satisfaction.

get to know: Vendor Managed Inventory 

What is WISMO?

Customers always want to get their orders quickly, so WISMO doesn’t have a problem, so they always want to receive updates on their orders or shipments.

What is meant by WISMO is that problem that arises when a customer does not receive their order, wondering where is my order.

This is a problem faced by many retailers and e-store owners, which can cost them the loss of customers completely.

Therefore, these merchants and e-store owners are keen to avoid the occurrence of the WISMO problem, in order to preserve the existing customers and not lose them.

Especially since the cost of acquiring a new customer is seven times the cost of maintaining an existing customer, so every effort is made to fulfill customers’ requests without any delays.

get to know : Scheduled Delivery definition and why is it Important? 

Why is WISMO reducing your profits?

WISMO can cause huge losses and a significant reduction in profits, both for e-store owners and retailers.

This is due to its negative effects, which are represented in reducing customer satisfaction with the service provided, as well as abandoning the shopping cart and dealing with you in general.

Especially since customers hate delays in orders, and they lose confidence in the event that there is a delay in receiving their order.

This problem affects the overall customer experience, thus increasing the likelihood of losing those customers.

This threatens the company’s profits in the first place, as well as its presence in the market and in front of its competitors.

The lack of a feature that allows them to track orders makes them less satisfied with the service provided as well as more nervous and anxious.

This is perhaps one of the most important reasons why retailers and e-store owners try to avoid and address Where Is My Order issues quickly and promptly.

get to know : Stock Availability Is a Key to Last Mile Performance

Tackling the WISMO issue: How to improve customer satisfaction

WISMO issues can be easily addressed by more accurately forecasting the duration of the entire sales journey.

For example, when the order leaves your warehouse, how long do customers expect the order to reach them directly, and so on…

You can send emails to them giving them a notification that their order has left the store.

Thus, they follow up on their order moment by moment, as well as try to provide a tracking page that serves as a page to track the status of customers’ orders.

This helps in avoiding WISMO issues, as well as making customers able to monitor the flow of their orders.

All of these things besides addressing the problem of Where Is My Order, contribute to increasing customer satisfaction as well as motivating them to do business with you again and again.

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One of the most important issues that hinders and causes problems for e-store owners is the delay in the shipping process, due to the delivery exception. Which would affect customer satisfaction, especially since customers always have high expectations for delivery, and they want the best possible service. Unfortunately, things don’t always go as planned, and these exceptions often occur while shopping at online stores. But by using modern technology and tools this can be addressed, and in this article we will provide you with all the details about delivery exception.

What is a delivery exception?

The delivery exception is a delay in the delivery of a customer’s order, due to something happening that prevented the order from being delivered on time.

There are many reasons for the this exception, which could be due to:

• Bad weather.
• Incorrect address.
• Incorrect label information.
• Shipping label damaged.
• Traffic problems.

get to know: Vendor Managed Inventory 

What are the different types of delivery exceptions?

There are many types of delivery exception that can occur on a daily basis, and they occur for more than one reason, and the following are the most important types of this exception:

Holidays and official occasions

Among the reasons for this exception is the occurrence of delays due to holidays and official occasions, which make the roads crowded and shipping companies disrupted most of the time.

Lost orders

One of the most important types of this exception is the loss of the order itself, for many reasons such as problems with the shipping company or problems with the delivery route.

There may be problems with the address such as incorrect or difficult to access, or missing documents.

Customs delays

Customs in the case of international shipping can cause delays in the delivery of orders, due to the procedures that international shipments go through in customs.

Traffic accidents

Most drivers use a route planner, in order to avoid traffic issues that result in this exception, thus delaying the delivery of customers’ orders.

There are problems with shipping information and documents

Shipping documents are important to the delivery process, and any problems or loss in them can cause this exception, including missing labels or missing customs documents.

Inclement weather

Extreme weather conditions can be a major reason for delaying customers’ orders, thus causing a problem in the delivery process which results in this exception.

get to know : Scheduled Delivery definition and why is it Important? 

Why are delivery exceptions important? 

It is very important for customers to get their orders on time, especially since online purchases involve a lot of worry about receiving the order on time.

The most common problem with e-commerce is the delivery exceptions, which cause customers to lose faith in the store they are dealing with.

And they become more discontented with the services provided, so this problem must be taken care of and try to address its occurrence, so as not to lose customers completely.

How a delivery exception impacts business?

These inconveniences related to the delivery process affect your business greatly, and here are the most important aspects of the impact:

• The inefficiency of your business, due to poor management and a lack of resources to deal with cases of shipping exceptions.
• The loss of resources, which costs the owners of electronic stores a lot of large losses, and clearly affects the revenues and profits achieved.
• Loss in overhead, for repeating the shipping process again after a problem with it, and thus incurring the shipping costs twice.
• Bad customer experiences, which result from the unsatisfactory service provided by the online store to customers, which results in customer dissatisfaction and dissatisfaction with the service provided.

Delivery exception issues

There are issues with delivery exceptions, which are caused when something goes wrong in the supply chain, so companies need to have proper systems in place to deal with those issues. The following are the main issues related to these exceptions:

Manual processes and lack of visibility

Manual processes contribute to the occurrence of these exceptions as well as the lack or lack of visibility, and therefore companies need to update the systems in which they operate.

So that it uses modern technologies that help them track the delivery of orders, as well as handle cases of delays in order delivery so that it does not affect customer satisfaction with the service provided.

Legacy systems

Legacy systems can cause exception problems, especially since most of these systems do not support reverse logistics.

So if there is a problem with the driver reaching the destination due to an error in the address being detected, the drivers will have trouble processing the order.

Solutions to a delivery exception

There are many solutions that can be relied upon in various e-commerce companies to address the problem of these exceptions.

Which helps in enhancing customer satisfaction with the services provided, and the following are the most important of these solutions:

1. Use more flexible coverage options

Flexibility in your coverage options helps you have better control, especially during the delivery process, which outsourcing can provide.

Proactive response to every delivery exception

The carrier needs to be proactive in responding to exceptions in delivery, thus being able to handle exception issues using real-time automation. Thus, the package is shipped back to the customer faster, thus keeping the delivery process efficient.

2. The if/then workflow

One solution to address this problem of exceptions is to create workflows by triggering alerts and action items.

Through which all scenarios are dealt with in an orderly manner, for example, if the work is not at home to receive the request, this solution will provide instructions on how to process and follow up.

3. Automate your exception handling

Automation technologies effectively help in better management of exceptions, by creating workflows with automated responses, thus optimizing the supply chain.

4. Create predictive alerts to handle delivery exceptions early

Dealing with these exceptions before they occur will help better handle flare-ups by creating alerts that help predict those exceptions.

And that is by relying on machine learning and artificial intelligence solutions, through which you can get automatic alerts in order to prevent the exception.

How to manage delivery exceptions efficiently?

Digitizing and automating the delivery and execution process can help you improve your first delivery attempt rate, especially since exception issues are always happening, but how you handle them will provide a better experience.

Diggipacks can help you provide the best courier and delivery service at the highest level, as well as its smart services in warehouse management and storage solutions.

What distinguishes it most is its reliance on the latest technologies and smart solutions, which will enhance your business and give your customers a better experience.

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Supply chain analytics is an essential component of supply chain management (SCM), as it contributes directly to improving business forecasting and efficiency. Thus, it helps companies to be more responsive to customer needs, by providing predictive analytics that contribute to anticipating consumer demand.

Which helps business owners to make informed decisions based on realistic data, as supply chain analytics works in understanding the various data generated by supply chains. In this article, we will talk in detail about these analytics and its importance, as well as its advantages and its most important characteristics.

What Is Supply Chain Analytics?

What is meant by supply chain analytics is the set of operations carried out by a number of software and used by companies in processing data related to the purchase of various commodities.

This analytics also works on knowing the value of data, data related to the purchase and distribution of goods, especially since that data is actually very large.

Thus improving forecasting and efficiency in companies so that they are more responsive to customer requests and faster in processing them, thus speeding up the delivery process and reducing costs associated with delays in delivery.

‎What Is the Role of This analytics?‎

Such analytics plays a major role in giving companies the ability to collect and process data generated by their supply chains. Then use that data to make long-term strategic changes that will give those companies a competitive edge.

Through the various activities carried out by these analyzes, different companies can increase the overall efficiency of business operations, which contributes to a significant reduction in costs.

As well as planning more accurately, helping companies continue to deliver a great customer experience, while keeping costs down.

 

Do you know what is inventory tracking?

‎What Are the Types of Supply Chain Analytics?‎

There are many types of this analytics, and each type has its own capabilities and uses. The following are the most important of these types in some detail:

1. Descriptive supply chain analytics

It is a type of this analytics that relies on the use of reports and dashboards to interpret events, based on a variety of statistical methods.

Through which he searches for information related to supply chain operations, as well as summarizes and organizes it accurately.

2. Predictive supply chain analytics

It is the third type of this analytics , which is based on prediction, as it helps to know what might happen in the future by analyzing current data.

3. Diagnostic supply chain analytics

This type is used to find out why something is not working. For example, if there is a delay in shipments, this method can help identify the reasons for that delay.

4. Prescriptive supply chain analytics

This type of analysis of supply chain operations helps to describe the best course of action, based on embedded decision logic.

Which effectively contributes to improving decision-making related to launching a new product, and clarifying whether it is appropriate to launch it or not.

What Is on Demand Warehousing?

‎Why Is Supply Chain Analytics So Important?

The reason why these analyzes have gained great importance in the recent period is their great role in helping companies make smarter and more effective decisions, so many companies have become dependent on them mainly in their business.

As it helps reduce costs and improve profit margins in companies, through the analyzes that you perform with different tools than the data available in real time.

This enhances companies’ ability to better understand risks and prepare for the future, as well as enhance the ability to plan in companies, which contributes to better forecasting of actual demand.

Benefits of Supply Chain Analytics

There are many benefits that these analyzes can provide to companies, and this is perhaps one of the most important reasons that drive most companies to rely on them. Here are the main benefits of this analytics:

1. Improve profit margins and reduce costs

One of the most important benefits of this analytics is its significant role in reducing costs as well as improving profit margins in companies.

This is because of its ability to provide comprehensive data for an integrated planning approach, enabling real-time visibility.

Thereby significantly increasing operational efficiency, providing useful and actionable insights.

2. Enhancing the ability to understand risks

This type of analysis enables companies to better understand risk, because of its role in identifying known risks and helping to predict future risks.

This is done through the analyzes it performs and examining the current data, while trying to discover the different trends and patterns expected in the supply chains.

3. Increase planning accuracy

These analyzes significantly increase the accuracy of planning by better analyzing customer data and thus predicting future demand.

4. Better warehouse control

Supply chain analytics helps in better monitoring of warehouses, in addition to analyzing customer needs, which contributes to better and more accurate decision-making.

5. Prepare for the future

The use of this analytics can provide advanced analytics to supply chain management, helping in better data processing and assisting companies in making optimal decisions.

Thus, companies become more prepared for the future and more facing any risks or threats, by obtaining alerts based on real-time data analysis.

are you know what is Scheduled Delivery?

‎Challenges of Supply Chain Analytics

There are many challenges to this type of analytics, the main one being a relatively high barrier to entry. Especially for companies that lack modern systems, buying technology can be an important investment for their business.

Another significant challenge facing supply chain analytics is that businesses do not have robust processes in place to collect the necessary data, as these analytics need documented integrations.

Through which it allows data to flow seamlessly, enabling companies to understand the current state of their business, as well as improve the future forecasts of their supply chains.

Among the important challenges is the lack of skilled labor, which works to build and interpret some of the analyzes in addition to the software that analyzes that data automatically.

So companies need to try to train employees to analyze as well as take advantage of the available technologies, thus providing better insights into their supply chains.

‎Features of Supply Chain Analytics

Supply chain analytics is constantly evolving, which means more and more independent supply chains that are able to manage and respond to changes.

Especially with continued improvements in IoT, which should help extract insights more quickly from a broader set of data sources.

And all of this in the last place will help improve the business of different companies, and that’s just as different AI technologies have improved.

Which will play a prominent role in improving people’s ability to generate more accurate, as well as more useful, predictive insights and include them in their business for better results.

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Accuracy in fulfilling customer orders is very important in e-commerce, especially since mis shipments may cause many problems for e-commerce companies as well as their relationship with customers, as customers lose confidence if they receive a wrong shipment.

Therefore, special care must be given to the process of fulfilling customer requests, from placing the correct product in the correct box, to attaching it to the correct data label and delivering it.

So dealing with customers and fulfilling their requests requires extreme accuracy, and in this article, we will show you all the details about mis shipments, and its harm to companies and its impact on customers. We will also show you how to deal with cases of wrong shipments, and how Diggipacks can help you with that.

‎What are mis shipments?‎

It is the process through which a wrong product is sent to the customer, which is contrary to his request, and this process causes a lot of losses.

Where customers lose confidence in your company when they receive a wrong shipment.

You as the business owner bear the cost of losing customer satisfaction and possibly losing it forever.

In addition to the costs associated with shipping the correct product quickly to the customer.

And therefore incurring double transportation expenses due to the wrong delivery of the customer’s shipment.

get to know: Vendor Managed Inventory 

‎How do mis shipments affect customers?‎

One of the most prominent consequences of mis shipments is their significant negative impact on customer satisfaction in general, as when a customer receives a wrong shipment, he feels very frustrated.

Which leads him to lose confidence in the services provided by that company, and in many cases it comes to canceling the order or not dealing with the same company again.

In addition to the significant impact of mis shipments on the profitability achieved by the company, they incur additional costs related to customer service to the company.

Frequent mis-shipments result in significantly reduced customer satisfaction and loyalty, which affects the company’s reputation and market position.

‎How do mis shipments damage businesses?‎

For businesses, mis shipments greatly affect the business’s presence and survival in the market, and this is because it seriously harms the profitability of companies.

In the event that shipments are incorrectly delivered, this means additional expenses associated with having the items shipped back correctly to their owners.

In addition to additional expenses related to customer service, as noted, mis shipments affect customer satisfaction and loyalty to the company.

Therefore, accuracy in fulfilling orders in the correct manner is extremely important in e-commerce in particular, especially since customers are more sensitive when they deal with online stores.

are you know what is Scheduled Delivery?

‎How to combat and prevent mis shipments

Mis shipments occur when someone in your company’s warehouse fails to pick up products exactly as specified in the fulfillment document.

From the moment the error arises, unwanted additional costs begin to negatively affect the performance and reputation of your company.

Especially since mis shipments result in huge costs that your company may not be able to avoid or recover again.

That’s why many companies try to minimize mis shipments, while trying to fulfill orders properly. Here are a number of practices that may help you combat mis shipments:

1. Check your stock on a regular basis

Which helps in better inventory management thus avoiding mistakes while picking or picking up and avoiding the problem.

2. Use Robust Warehouse Management Software and Barcode Scanners

Which will help you update your inventory accurately, and check that the correct items are selected according to the requests of the customers.

3. Perform a quality control check

By using useful techniques to scan the request quickly after it has been selected to verify its validity.

4. Offer an easy returns system

Allowing customers to ship products back correctly and as quickly as possible, in an effort to gain their satisfaction again.

‎How Diggipacks can help your business prevent mis shipments

Diggipacks intelligent systems can help you reduce mis shipments, by utilizing modern technologies around inventory and returns management.

Which would help you in accurately fulfilling orders and selecting different items, as well as inventory management systems that are able to provide you with reports about your inventory and follow it up continuously.

This provides you with the ability to better meet customer requests, as well as avoid cases of wrong delivery of products and provide a system of returns and customer service at the highest level.

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Carrying Cost is a component of total inventory costs, and those costs have a significant impact on a company’s revenue. These costs are high for companies that benefit from economies of scale, but low for companies that have a small amount of inventory. This cost is examined by management as part of its assessment of the amount of inventory to maintain, and in this article we will discuss in detail the Carrying Cost, its importance, as well as its components and methods of calculation.

‎What Are Carrying Costs?

These are the costs associated with the storage of unsold goods, which the company incurs while storing raw materials or semi-finished goods.

As well as finished goods or spare parts in the warehouse, waiting to be used in the future in order to meet expected demand, settle production needs, and protect the facility from depleting the quantity of goods.

Knowing the Carrying Cost also helps prevent costs from spiraling too high, as well as reducing instances of price hikes.

Do you know what is inventory tracking?

‎Significance of carrying cost

Knowing how much a company’s carrying cost is helps determine how long a company can hold their inventory, before they start losing money on unsaleable items.

Thus the company can know how much they need to buy and sell in order to maintain proper inventory levels. Thus, working to:

• Recover the funds restricted in the inventory.

• Determine the transportation costs incurred by the company.

• Help the company to increase its profits.

The carrying cost in any company usually represents about 15% to 30% of the value of the company’s stock.

And if it exceeds that percentage, then this means that the company is in a bad financial position.

‎Components of carrying cost

As we indicated, the Carrying Cost is considered part of the total costs borne by the company.

And it consists of a number of basic elements. The following are the most important components that make up carrying costs:

• Depreciation costs, which can be significant if the company invests large sums in automated storage and retrieval systems.

• Insurance costs, which include costs associated with insuring the company’s inventory asset.

• Obsolete Inventory Write-offs, which are the costs associated with writing off inventory that has been held for a long time and has not been sold. This cost can be significant, especially for companies that introduce new products on a regular basis.

• Personnel or labor costs, including warehouse staff costs, such as benefits, salaries, taxes, etc.

• The costs of renting a storage place, and the company must choose the place well and appropriately for the inventory, as this cost may be large if the storage system followed by the company does not guarantee the optimal use of the warehouse space.

• Safety and security costs, including the costs of security guards, monitoring systems, etc., and usually the value of these costs increases as the value of inventory increases.

What Is on Demand Warehousing?

‎How to calculate carrying cost

As for the method of calculating the carrying cost, it is easily done through the use of a mathematical formula.

Through which the company can calculate the profit it achieves from its inventory.

The following is the mathematical formula used in calculating the carrying cost, which is always represented as a percentage of the company’s total inventory value:

• Carrying cost = (Inventory holding sum ÷ Total value of inventory)*100.

Inventory holding sum is the total cost of transportation, which consists of four basic elements:

• Inventory service cost.

• Inventory risk cost.

• Capital cost.

• Storage cost.

Thus, the mathematical formula used in calculating the Inventory holding sum within the carrying cost accounts is as follows:

• Inventory holding sum = Inventory service cost + Inventory risk cost + Capital cost + Storage cost.

Here are the steps you need to be able to easily calculate those costs based on the mathematical formulas we showed you:

1. Calculate the value of each of the four components of inventory cost that we have shown.

1. Add these four inventory cost components to get the inventory holding sum.

1. Calculate the total value of your inventory.

1. Divide the inventory holding sum by the total value of inventory.

1. Multiply the division in the previous step by 100 to get the desired percentage.

get to know: Vendor Managed Inventory 

‎Reducing Inventory Carrying Costs with Inventory Management Software 

Inventory management software can help reduce carrying costs significantly, with smart tools and automation systems.

That enables you to get accurate data about your inventory and avoid situations of sudden overstocking or shortage of stock.

Which means reducing the costs associated with carrying stock for a long time. Inventory management systems also help you monitor your inventory and accurately quantify in real time.

Thus avoiding cases of inventory loss or theft and Diggipacks can provide you with the best inventory management system.

Which will help you manage your inventory efficiently as well as reduce your inventory carrying costs.

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Sorting might not be the flashiest part of ecommerce logistics, but in reality it’s one of the most critical levers behind speed, accuracy, and stability in fulfillment.

At Diggipacks, sorting is not just people moving boxes around. It is an operational logic embedded inside our unified logistics systems powered by Fastcoo – from the moment inventory is received to the moment an order is handed off to the right carrier.

What Is Warehouse Sorting?

Warehouse sorting is the process of organizing and routing products inside a fulfillment center so that every item reaches:

• The right location

• At the right time

• Via the right path

In Diggipacks, this is orchestrated by Fastcoo cloud logistics stack (WMS / OMS / Last Mile), which unifies storage, fulfillment, last-mile aggregation, and COD flows on a single platform.

Core Concepts – As Implemented in Fastcoo

Sortation

Rules inside Fastcoo that group items and orders by:

• Destination

• Carrier

• Service level (standard / express / cold)

• Product type

Routing

Fastcoo determines the optimal path:

• From receiving

• To storage

• To picking zones

• To packing stations

• To the correct outbound dock or carrier lane

Put-away

The WMS suggests and enforces smart put-away locations based on:

• Turnover velocity

• Size and weight

• Product family

This directly impacts future picking and sorting efficiency.

Picking & Packing

Picking waves and packing queues in Fastcoo are built using the same sortation logic:

• Grouped by carrier, region, or priority

• With on-screen instructions to reduce human decision-making and error

How Sorting (Through Fastcoo) Impacts Performance

When sortation rules are baked into the system instead of staying in people’s heads:

• Delivery speed improves (fewer decision points, less back-and-forth).

• Operational cost per order drops (less walking, less rework).

• Order accuracy goes up (system-driven checks at each step).

• Customer experience benefits from faster, more reliable final delivery.

Diggipacks leverages this by running all fulfillment flows on top of Fastcoo  unified SaaS platform.

The Main Sorting Stages in a System-Driven Operation

Inbound Sorting

As inventory is received:

• Items are scanned into Fastcoo

• Classified by product type and storage profile

• Assigned to optimal storage zones via put-away rules

Bad inbound sorting shows up later as:

• Slow picking

• “Phantom stockouts” (stock exists but is misplaced)

Order Sorting

Once orders enter the system:

• Fastcoo groups them into waves based on:

  • Carrier

  • Service level

  • Destination region

• Picking tasks are generated in logical routes for operators

This reduces congestion and makes packing much more predictable.

Outbound Sorting

After packing:

• Parcels are routed (logically, inside Fastcoo) to:

  • The right staging area

  • The right carrier manifest

  • The correct dock or handover point

Outbound sortation errors = expensive delays and re-shipments.
System-driven outbound sortation = clean handoff, clean tracking, clean reporting.

Sorting Methods – With Systems in Mind

1) Manual Sorting

Still useful for:

• Special items

• Low-volume SKUs

• Edge cases

But always backed by the system as the source of truth.

2) Semi-Automated Sorting

In Diggipacks-style operations, this usually means:

• Conveyors, racks, and structured workstations

• Plus Fastcoo screens, scanners, and device prompts

• Humans execute; the system decides.

3) Fully Automated Sorting (Industry Level)

Described here as an industry model, not as our current setup:

• High-speed cross-belt / tilt-tray / robotics

• Requires deep WMS integration and high, stable volumes

Fastcoo’s architecture is designed to integrate with such automation if and when it becomes relevant.

4) Hybrid Solutions

The realistic, scalable model:

• Use system logic (Fastcoo) for decisions

• Use people + light mechanics (conveyors, scanners) for execution

• Grow automation gradually as volume justifies it

5) Specialized Sorting

Fastcoo flags SKUs and orders that need special handling:

• Fragile

• Temperature-controlled

• High-value

• Regulated

These flags drive:

• Dedicated zones in the warehouse

• Extra packing steps

• Different routing rules

Best Practices – When You Have a Strong System Like Fastcoo

1. Design your warehouse around system flows, not the other way around.

2. Let Fastcoo drive waves, queues, and routes; don’t rely on paper.

3. Tie sortation rules directly to KPIs (cost per order, lead time, error rate).

4. Model peak-season scenarios inside the system before reality hits.

5. Keep operators flexible, but keep decisions in the software.

 

Everything we described about warehouse sorting:

• Isn’t theoretical.

• It’s how a unified logistics stack like Diggipacks + Fastcoo is meant to operate:

  • One platform,

  • Multiple services (Fulfillment, Last Mile, SaaS, LaaS),

  • With sortation logic embedded at every step of the flow.

Delivering orders quickly and efficiently is one of the key factors in providing a positive customer experience. In this article, we present 10 tips to help achieve this using services like those offered by Diggipacks.

1. Evaluate and Improve Inventory Management Processes

Effective integration between inventory and order management ensures product availability and minimizes delays caused by stock shortages.

2. Partner with Reliable Logistics Providers

Collaborating with experienced partners in delivery, such as Diggipacks, guarantees efficiency and reliability.

3. Utilize Order Tracking Technologies

Modern technologies enable real-time order tracking, which helps build customer trust and manage their expectations.

4. Plan Ahead for Seasonal Demands

Plan inventory and resources for seasonal peaks to avoid bottlenecks and delays in order deliveries.

5. Offer Multiple Shipping Options

Provide customers with various shipping options, such as express or economy shipping, to meet diverse needs.

6. Continuously Monitor Employee and Operational Performance

Evaluating the performance of your team and improving their skills ensures high levels of efficiency and productivity.

7. Reduce Hidden Costs

Adopt smart solutions to minimize waste in resources and time that could impact the final cost.

8. Educate Customers About Logistics Processes

Clear and transparent communication with customers helps alleviate concerns and builds their confidence in your business.

9. Implement Advanced Packaging Solutions

Proper packaging ensures the product arrives in excellent condition, enhancing the customer experience.

10. Embrace Continuous Improvement and Innovation

Monitoring market trends and technology ensures you stay ahead with the latest solutions to enhance your services.

Diggipacks is more than just a logistics provider; it’s a technology-driven partner designed to transform your logistics operations into a seamless and efficient process. By leveraging cutting-edge technology, real-time tracking systems, and innovative solutions tailored to your business needs, Diggipacks ensures that you stay ahead of the competition. Whether you are a growing startup or an established enterprise, Diggipacks provides the expertise, tools, and support to help you scale your operations and deliver exceptional customer experiences every step of the way.