Common Mistakes in Shipping: Mastering How to Avoid Them

3PLs, 4PLs
March 8, 2024

Common Mistakes in Shipping: Mastering How to Avoid Them

Shipping is the lifeblood of commerce, seamlessly connecting goods to markets and consumers around the globe. In this high-stakes realm, common mistakes in shipping can be costly, impacting customer satisfaction and a company’s bottom line. A solid understanding of shipping processes and diligent oversight are crucial in maneuvering through potential pitfalls, from errors in a Bill of Lading to oversight in overall ecommerce strategy.

Navigating the complexities of freight shipping, optimizing costs, and choosing the right parcel carrier and or methods are paramount. We explore avenues ranging from third-party logistics support to leveraging a shipping rates calculator for cost-efficient dispatches. What’s more, we’ll also stress the importance of customs clearance, address validation, and the role of warehouse management in refining the shipping process.

Keep reading to learn how your business can avoid the most common mistakes in shipping in 2024.

Get connected to the best shipping solutions, rates and software for your business. Schedule your consultation today! We’re experts at cost reduction and logistics!

Inaccurate Information on Bill of Lading (BOL)

A bill of lading (BOL) is not just a piece of paper; it’s a crucial legal document that underpins the shipping industry. Serving multiple roles, it acts as a receipt for the goods shipped, evidence of the contract between shipper and carrier, and a document of title that can be used to transfer ownership of the goods. The accuracy of the information on a BOL is imperative, as it ensures the smooth transit of goods and legal compliance.

Key Elements to Verify on a BOL:

Reference Numbers: Ensure that reference or purchase order numbers are correct to avoid confusion and ensure proper tracking.
Shipper and Consignee Details: Verify the shipper/ship from and consignee/ship to information for accuracy to prevent misdelivery.
Shipment Details: Double-check the shipment details, including the National Motor Freight Classification (NMFC) and hazardous materials declarations, to avoid shipping delays and legal issues.
Freight Charges: Confirm that third-party freight charges, if applicable, and the method for payment of freight charges are clearly mentioned to prevent billing disputes.
Packaging Type and Freight Class: Correctly identify the packaging type and freight class to avoid additional charges and ensure that the cargo is handled properly.
Carrier and Driver Information: Carrier name and driver signature must be present to validate the BOL.

Common Pitfalls and How to Avoid Them:

Incorrect Item Description: Always use the precise commodity description to prevent misclassification.
Wrong Notify Party: Ensure the correct notify party is listed to avoid miscommunication.
Weight and Piece Count: Accurately document the weight and piece count to prevent discrepancies that could lead to additional charges.
Hazardous Materials: Properly identify and list hazardous materials to comply with safety regulations and avoid penalties.
Service Contract Number: Include the service contract number when applicable to adhere to carrier requirements.

Ensuring BOL Accuracy:

Automation via TMS: Implementing a Transportation Management System can automate the entry of BOL information, significantly reducing the potential for human error.
Double-Check Details: Before finalizing the BOL, double-check for accurate documentation of weight, freight classification, packaging type, and other essential details.
Address Validation: Confirm that the address listed is complete and accurate, including all necessary details, to prevent the freight from being delivered to the wrong location.

Inaccuracies on a BOL can lead to a domino effect of problems, affecting not just the immediate shipping process but potentially causing issues with insurance coverage and legal compliance. In some cases, intentional misinformation can result in criminal charges, underscoring the need for meticulous attention to detail and in partnering with the right international shipping company to ensure accuracy.

To avoid these pitfalls, it’s crucial to provide complete and accurate information across all sections of the BOL, from the item number and freight class to contact information and hazmat requirements. What’s more, ensuring that all paperwork is complete and accurate can prevent significant issues that could otherwise arise, safeguarding your products and business reputation.

Running Out of Packing Supplies

Running out of packing supplies can disrupt the entire shipping process, leading to delays, increased costs, and customer dissatisfaction.

Inventory Management

Regular Inventory Checks: Implement a system to regularly monitor packing supplies, ensuring that items such as boxes, tape, and cushioning materials are always in stock.
Designated Storage Areas: Store corrugated cardboard boxes by size in specific locations to streamline the packing process and minimize the risk of damage.
Accessible Packing Materials: Position paper dispensers near packing stations to keep rolls of packing paper within easy reach and in prime condition.

Efficient Packing Practices

Restocking System: Establish a method for restocking critical shipping materials, such as an automated alert when supplies dip below a certain threshold.
Workspace Organization: Maintain a clean and organized packing area to improve productivity and prevent the unnecessary loss of packing materials.

Packing Material Selection

Varied Box Sizes: Use high-quality boxes and an assortment of sizes to accommodate different product dimensions, especially for delicate items.
Cushioning Choices: Utilize soft, plush materials for padding, and secure loose items with plastic wrap to minimize movement during transit.
Innovative Packing Options: Explore traditional packing materials like excelsior or recycled wine corks, or opt for custom solutions like corrugated inserts or hot-glued smaller boxes within larger ones for added stability.

Protecting Fragile Items

Bubble Wrap and Foam: For items like framed art or electronics, bubble wrap or anti-static foam can provide the necessary protection against shocks and vibrations.
Custom Foam Tubing: Irregularly shaped or extra fragile items may benefit from custom foam tubing to ensure a snug fit and prevent damage.

Packing Efficiency Tips

Box Size Precision: Select a box only slightly larger than the item, leaving just enough space for cushioning to inhibit movement.
Dunnage for Stability: Use dunnage such as air pillows or crumpled paper to fill any voids within the package, ensuring items remain stationary during shipping.

Running out of packaging supplies, especially during peak periods, can result in significant time and financial losses. By implementing these strategies, businesses can ensure they’re prepared for any shipping scenario, maintaining the integrity of their shipments and customer satisfaction. What’s more, by using appropriate packaging materials and methods, shippers can minimize the risk of damage and returns, ultimately protecting their bottom line.

Inappropriate Packing Methods

Inappropriate packing methods can lead to product damage, customer dissatisfaction, and ultimately, increased costs for a business.

Selecting the Right Packaging

Optimize Box Sizes: Excessive unused space isn’t just a waste of material; it can also cause products to shift and become damaged during transit. To reduce unused space, increase your selection of packaging sizes or consider using bags and envelopes for smaller items.
Material Reuse: While reusing packaging materials is eco-friendly, it’s crucial to assess their condition. Reused bags, envelopes, and cardboard can weaken from wear and tear, compromising the protection of your items. Alternatively, invest in reusable pallets and cargo containers made from durable materials like plastic or steel for a more sustainable and secure option.

Packing Techniques for Fragile Items

Filler and Dividers: Insufficient filler or the absence of dividers can spell disaster for fragile items. Ensure you use adequate filler or dividers to keep items from colliding and to provide cushioning against shocks.
Labeling for Care: Clearly label packages containing delicate items to alert handlers. This step is simple but vital in communicating the need for careful handling.

Best Practices for Damage Prevention

Quality Packing Materials: Investing in quality materials can make a significant difference. Use right-sized boxes, satchels, and protective materials tailored to each item’s needs. For temperature-sensitive items, consider specialized packaging to maintain their condition.
Stacking and Handling: Incorrect stacking patterns can lead to damaged goods. Educate your team on the best practices for stacking and handling packages to minimize the risk of damage.
Insurance for Assurance: Shipping or parcel damage insurance can mitigate financial losses due to damage, lost packages, or theft. It’s a small investment for peace of mind and financial protection.
Carrier Selection: Not all carriers handle packages with the same level of care. Compare shipping carrier options and select one known for reliable handling practices to reduce the likelihood of damage.

By adopting these methods, you’re not only ensuring the safety of your products but also reinforcing customer trust and satisfaction. In addition to this, proper packaging can serve as a reflection of your brand’s commitment to quality and sustainability.

Get connected to the best shipping solutions, rates and software for your business. Schedule your consultation today! We’re experts at cost reduction and logistics!

Listing Incorrect Address

With over 165 million addresses in the US and an error rate of 4.7% in shipping forms, the risk of parcels becoming “dead mail” or “orphaned packages” is not just a minor inconvenience; it’s a significant issue that affects 10% of all lost packages. Address inaccuracies can result in delayed deliveries, rerouting fees, and dissatisfied customers.

Address Verification and Labeling Practices

Confirm Addresses: Always verify addresses with recipients to avoid errors. Utilize autocomplete APIs, which can significantly reduce the chances of an incorrect address by confirming details as they are entered.
Labeling Specifications: Print addresses clearly in at least a 10-point size to ensure legibility. Cover address labels with clear tape for protection and follow the correct USPS address format to avoid issues with insufficient addresses.
Mailing Lists: Keep your mailing lists up-to-date. Regular validation of your contact database minimizes the chances of shipping to an outdated or incorrect address.

Preventing Address-Related Fraud

Mail Fraud Awareness: Incorrect addresses can lead to more than just lost packages; they can open the door to mail fraud and identity theft. Scammers may use change-of-address forms to reroute sensitive mail and steal personal information.
Red Flags: Be vigilant for warning signs of change-of-address fraud, such as unexpected change-of-address confirmation forms, a decrease in mail volume, or notifications of unauthorized changes to billing addresses.
Immediate Action: If you suspect change-of-address fraud, contact the U.S. Postal Inspection Service immediately and file a report. Consider using an identity theft protection service to safeguard against further issues.

Online Purchases and Address Corrections

Checkout Accuracy: When making online purchases, double-check that the correct shipping address is entered during the checkout process. If an error is made, contact the seller or customer support immediately to correct it.
Redirecting Shipments: If a package is misdelivered due to an incorrect address, contact the carrier to redirect the shipment. If that isn’t possible, consider issuing a replacement item to the correct address.
eBay and PayPal: For eBay sellers, ship only to the address on file with PayPal to ensure protection for both parties. If a buyer requests an address change after purchase, void the original label and create a new one with the updated address.

Employing tools like the ELEX Address Validation plugin can enhance the accuracy of shipping details by verifying addresses against EasyPost, UPS, USPS, and Addressfinder APIs. Enabling features such as “Enforce Address Validation” ensures customers cannot proceed without a valid address, while the “Confirm Before Validation” option requires customer confirmation of the address, adding an extra layer of verification.

Taking these steps to ensure accurate and validated addresses before shipping not only reduces the risk of lost or delayed parcels but also enhances brand credibility by ensuring the deliverability of packages. With the correct approach to address validation and fraud prevention, businesses can protect their customers, their reputation, and their bottom line.

Incorrect Weight and Freight Class Listings

In the intricate dance of freight shipping, the National Motor Freight Classification (NMFC) system plays a pivotal role, categorizing goods into 18 classes based on factors such as density, handling, stowability, and liability. These classes range from 50 to 500, with higher classes attracting higher rates. Shippers must tread carefully to ensure that the weight and freight class listings on the Bill of Lading (BOL) are accurate; otherwise, they may face the music in the form of reweighs, re-classifications, and consequent extra fees.

Understanding Freight Class and Weight Listings:

Freight Class Accuracy: Confirm that the freight class declared on the BOL aligns with the actual freight class. Misclassification can lead to increased shipping costs, re-class fees, incorrect quotes, and even damaged products.
Weight Verification: Use a reliable scale to ascertain the exact weight of the shipment. Inaccurate weight listings can trigger re-weigh fees and may also lead to product damage.

Mitigating Risks of Incorrect Listings:

Transportation Management System (TMS): Employ a TMS to ensure accuracy in freight information, which helps prevent unexpected fees.
Carrier Communication: Share precise and complete details with freight carriers and stay informed about NMFC updates that may affect freight class or shipping costs.
Packaging and Labeling: Ensure that packaging and labeling accurately reflect the freight’s weight and class. Properly weighed packages help avoid overweight fees and protect the items during transit.

When a discrepancy arises between the listed, dimensional and actual weight or class, carriers may reweigh or reclassify the shipment, leading to a change in shipping rates. For instance, a shipment with initial dimensions of 40L x 48W x 75H and a weight of 850 lbs could be classified as 92.0 based on a density of 10.20. If upon inspection, the shipment’s dimensions are found to be 42L x 49W x 82H with the same weight, the density correction to 8.70 could shift the classification to 100, altering the cost.

Steps to Avoid Costly Adjustments:

Verify Dimensions and Weight: Before shipping, double-check the dimensions and weight of your freight. Use tools that provide accurate measurements to prevent carriers from having to reweigh and readjust loads, which can be costly.
Review Freight Class: Utilize resources like Freightquote by C.H. Robinson to determine the correct classification for your freight, avoiding reclassification fees.
Dispute with Evidence: If you believe a carrier’s reweigh or reclassification is incorrect, gather concrete evidence including shipping tickets, invoices, photographs of the shipment, and scale readings to file a dispute.

Proactive Measures for Compliance:

Digital Inventory: Create a detailed digital inventory to reduce mistakes. Discuss service requirements with your carrier before shipping to ensure mutual understanding.
Carrier Selection: Opt for carriers that prioritize accuracy and transparency in their operations. This partnership can be vital in navigating the complexities of the NMFC system.
Education and Assistance: Work with a transportation partner to learn the NMFC system. If in doubt, don’t hesitate to ask your carrier or broker for assistance.

What’s more, shippers should be aware that freight liability coverage is mandated by law. Understanding limited liability is essential to know the fate of your freight if it’s lost, damaged, or stolen during transportation. By taking these steps, shippers can navigate the NMFC system with confidence, avoiding surprises that can disrupt business operations and impact the bottom line.

Faulty Labeling Practices

Faulty labeling practices in shipping can lead to a multitude of issues, including misdeliveries, delays, and even legal complications, particularly when hazardous materials are involved. To mitigate these risks and streamline the shipping process, certain strategies must be implemented:

Strategies for Accurate Labeling:

Double and Triple-Check System: Establish a protocol for multiple verifications of labeled items prior to dispatch. This reduces the risk of errors that can occur with single checks and ensures that the label information matches the contents and destination of the shipment.
Warehouse Management System (WMS): Leveraging technology such as a WMS can significantly decrease the incidence of incorrect data due to human error. Automated systems facilitate proper scanning and labeling, thereby reducing the chances of incorrect items being shipped.
Label Quality and Placement: Use labels that are durable and fit the packaging properly. For different packaging types, such as flat-rate envelopes or large boxes, select the appropriate label size and material to prevent detachment or damage during transit.

Labeling Best Practices:

Visibility and Durability: Place labels on the largest, flattest surface of the package, avoiding placement on the bottom, corners, edges, or seams. This enhances the label’s visibility and reduces the likelihood of damage during handling and shipping.
High-Quality Printing: Ensure labels are printed with high resolution and contrast for sharp and readable text and images. This is crucial for accurate scanning and readability by both machines and humans throughout the shipping journey.
Protection Measures: To safeguard labels from environmental damage and handling, either encase them in a clear plastic pouch or cover them with transparent tape. This simple step can prevent a multitude of issues arising from illegible or damaged labels.

Label Management and Application Techniques:

Centralized Label Management: Implement centralized programs that integrate order reading, label printing, and shipping tracking. This not only saves time but also enhances accuracy by reducing manual data entry.
Clean Application Surface: Prior to label application, clean the area to remove any debris or residue that could interfere with adhesion. This ensures the label remains securely attached throughout the shipping process.
Automated Labeling Systems: Utilize automated systems for labeling packages, which can significantly reduce human errors associated with manual labeling processes.

Businesses should be vigilant in ensuring that all labeled information is checked not just once, but multiple times. This includes verifying that the right information is conveyed on the label to prevent any delays, damaged goods, or misdirection of shipments. What’s more, by adopting automated systems and thorough verification processes, mislabeling and its associated problems can be greatly reduced, leading to more efficient and reliable shipping practices.

Avoiding Palletizing When Necessary

Palletization is a common practice in logistics to consolidate shipments for easier handling and transportation. Yet, it isn’t always the go-to solution for every business or type of cargo. Small businesses, in particular, or those dealing with fragile or irregularly-shaped items, might find that palletizing isn’t the most efficient or cost-effective method for their shipping needs.

When to Consider Alternatives to Palletizing:

Small Business Shipments: For small businesses with limited cargo, palletizing might introduce unnecessary costs and complexities. These businesses can often manage shipments without the need for pallets, utilizing courier services that cater to smaller volumes.
Fragile or Irregularly-Shaped Items: Products that are fragile or have unique shapes may require specialized packaging solutions that pallets cannot provide. Custom crating or packing might be necessary to ensure these items reach their destination safely.

Selecting the Right Shipping Method:

Assess the Cargo: Before deciding on palletizing, evaluate the nature of the cargo. In addition to this, consider the shipping method and destination to determine the most appropriate way to send your products.
Heavy Items Consideration: If you’re shipping heavy items, ensure that they can be lifted and transported safely. Heavy cargo might still benefit from palletization for secure and efficient handling.

Advantages and Risks of Palletization:

Time and Effort Savings: Palletizing can save significant time and effort in the shipping process and reduce the risk of damage.
Potential for Damage and Delays: On the flip side, failing to palletize when necessary can lead to goods being damaged, tracking difficulties, and delivery delays. What’s more, it’s crucial to conduct test shipments with new carriers or shipping partners to assess package handling and ensure delivery care.

In the evolving logistics landscape, many sectors, such as fashion and retail, are moving away from traditional pallets in favor of boxes or other packaging methods that better suit their products and shipping requirements. Businesses should weigh the pros and cons of palletizing against the nature of their products and the specifics of the shipping process. By doing so, they can optimize their shipping strategy, whether that means employing pallets or taking a different route altogether.

By considering the type of cargo and its specific needs, businesses can make informed decisions about whether palletizing is the right choice. In cases where it isn’t, alternative packaging and shipping methods can be employed to ensure that goods are delivered in the best condition possible, bolstering customer satisfaction and maintaining a competitive edge in the market.

Opting Out of Freight Insurance

Freight insurance is a safeguard for businesses against the financial loss of cargo during transit. This insurance covers the liability of a freight forwarder if goods are lost or damaged due to their negligence. Compensation under freight insurance is typically calculated based on the weight of the goods, but it is capped by conventions, meaning there’s a limit to the amount that can be claimed.

Risks of Opting Out of Freight Insurance:

Fragile and High-Value Goods: Without insurance, businesses shipping fragile items or high-priced products face significant risk. If these goods are damaged or lost, the financial impact can be severe, particularly when the claims processing time is constrained.
Long-Distance Transportation: Marine cargo insurance is essential for goods transported by sea, as it protects against loss or damage from external causes, such as theft, fire, or natural disasters. Businesses involved in international shipping should not overlook this protection due to the considerable financial risks posed by uncontrollable external factors.
Financial Vulnerability: Shipping without insurance leaves a business exposed to potential financial ruin in the event of an accident, theft, or natural disasters. These incidents can damage goods beyond repair, leading to substantial monetary losses.

Key Considerations for Marine Cargo Insurance:

Policy Understanding: It’s crucial to comprehend the coverage and exclusions of a marine cargo insurance policy. This understanding helps in assessing the value of the cargo and ensuring the policy meets the business’s needs.
Insurer’s Reputation: The insurer’s reputation and financial standing are vital considerations. Businesses should choose an insurer with a strong track record of honoring claims and providing robust support.
Carrier Liability Limits: Familiarize yourself with carrier liability limits. These limits often do not cover the full value of the cargo, making additional insurance a wise investment.

Common Misconceptions and Exclusions in Cargo Insurance:

Misconceptions: Importers often mistakenly believe their shipments are covered by the freight carrier, forwarder, or supplier. In reality, these entities typically do not cover the full cost of lost or damaged goods.
Exclusions: Marine cargo insurance policies commonly exclude coverage for damage resulting from inadequate packaging, customs rejections, payment failures, abandoned cargo, and hidden defects in goods.

Benefits of Cargo Insurance:

Comprehensive Coverage: Cargo insurance can provide coverage for nearly any shipping scenario, including marine, air, and rail, and is particularly advantageous for vulnerable goods like frozen products.
Shared Liability: Certain policies cover the insured’s share of the general average in case of a fire, distributing the loss among all stakeholders.
Versatility: Cargo insurance policies can insure all types of goods and merchandise, with the option to cover both prepaid freight and freight payable on delivery.

Insurance Options and Strategies:

Flexport’s Offerings: Companies like Flexport offer cargo insurance at competitive rates, including all-risk options and specialty coverage tailored to various risks and events.
Avoid Underinsurance: It’s critical to insure goods for their total value and avoid the pitfall of underinsurance, which can lead to significant financial losses in case of damage or loss.
Protection Against Damages: Insurance plays a pivotal role in protecting against the inevitable damages that can occur during shipping, offering peace of mind and financial security.

In addition to this, businesses should be aware that opting out of freight insurance can result in not only the loss of goods but also a tarnished reputation if customer orders cannot be fulfilled due to shipping incidents. By investing in comprehensive cargo insurance, companies can ensure their shipments are protected against a wide array of risks, maintaining their competitive advantage and customer trust.

Relying on a Single Carrier

Mitigating the risks of cross-border shipping demands a strategic approach to carrier selection. Companies that rely on a single carrier are vulnerable to a range of issues that can affect their bottom line and customer satisfaction.

Diversification Benefits:

Flexibility and Options: By maintaining connections with multiple carriers, businesses can select the most suitable option for each shipment based on cost, speed, and reliability, ensuring timely delivery without overpaying.
Competitive Pricing: Access to competitive pricing is a key advantage of working with multiple carriers. This allows for rate shopping to maximize negotiated discounts and avoid surcharges and capacity limits.
Service Continuity: Having backup options is critical. If one carrier experiences disruptions, such as weather delays or labor strikes, alternative carriers can be used to maintain service levels and delivery promises.
Specialized Services: Different carriers offer specialized shipping services. By not limiting themselves to a single carrier, businesses can leverage these services to meet evolving customer expectations and offer more delivery options.

Risks of Single-Carrier Dependence:

Service Disruption Vulnerability: Sole reliance on one carrier can leave a business stranded during service interruptions, leading to delays and risking the company’s reputation.
Cost Implications: Without competition, single-carrier parcel shipping can result in higher costs. Carriers may not be as motivated to offer competitive rates or excellent service if there’s no risk of losing the business.
Growth Limitations: As businesses expand, their shipping needs evolve. Being tied to a single carrier can restrict growth and scalability, preventing the company from adapting to new market demands.

Strategies for Effective Carrier Management:

Third-Party Logistics (3PL) Providers: Partnering with an experienced 3PL or 4PL provider can help vet carriers and manage the entire shipping process, reducing the risks associated with cross-border shipping.
Security Protocols: Ensure that shipping facilities have robust security protocols, especially when working with providers for transloading freight.
Proactive Management: Regularly compare the overall cost and ROI of different carriers. This helps in making informed decisions and avoiding the risks associated with relying on a single logistics firm.
Scalability and Flexibility: Maintain flexibility in your shipping strategy to manage fluctuating volumes, especially with the surge in ecommerce and DTC shipping. Regional carriers can be less prone to supply chain disruptions and can offer more tailored services.

Businesses should recognize that supply chain disruptions can be better managed with a flexible strategy that includes multiple carriers. This approach not only meets customer demands for a variety of shipping options, including faster shipping times and lower rates, but also enhances overall satisfaction by ensuring reliability and responsiveness in the face of unforeseen challenges.

Final Thoughts

Throughout this detailed exploration, we navigated the labyrinth of common shipping mistakes, imparting strategic insights to bolster your logistic operations. What’s more, we underscored the cascading effects of inaccuracies–from documentation to delivery addresses–and their formidable cost implications. A recurrent theme is the necessity for proactive measures, rigorous oversight, and an unwavering commitment to precision in every facet of the shipping process.

In addition to this, embracing diversity in carrier selection and understanding the significance of freight insurance emerges as essential for safeguarding against the vulnerabilities of a complex supply chain. As we strive for shipping excellence, businesses must pivot from pitfalls to proficiency. For those seeking tailored advice and competitive shipping rates, Parcel Consulting’s free Shipping Rates Audit and Analysis is designed to optimize your operations and turn shipping into a competitive edge that aligns seamlessly with your business objectives.

Get connected to the best shipping solutions, rates and software for your business. Schedule your consultation today! We’re experts at cost reduction and logistics!

Parcel Consulting Can Help!

As any business evaluates the various national carriers to determine the best fit for their needs, it’s important to remember that software and technology innovations have made it easier than ever to utilize many different carriers, including regional carriers, couriers, and various final mile delivery providers to get the lowest costs and best results.

At Parcel Consulting, we help any business see how their rates and parcel strategy stacks up against their competition and the largest retailers in the world.

Our shipping experts and innovative analysis process allow your business to know they have the best shipping rates possible and they are utilizing the most effective strategies to get their packages delivered to each and every customer.

Common Mistakes in Shipping: Mastering How to Avoid Them