The Procurement Glossary » Freight Consolidation

Freight Consolidation

Inventory & Logistics

Definition

Combining multiple shipments into fewer, fuller loads to cut transport cost per unit.

Explanation

Consolidation fills trucks and containers rather than paying to move part-loads, lowering freight cost and emissions. It requires coordinating timing and orders — e.g. weekly supplier milk-runs — and is a common logistics saving lever.

Example

Consolidating five suppliers' weekly deliveries into one truck cuts inbound freight cost by a third.

Related terms

• Freight — The transport of goods and the charge for that transport.
• Logistics — The management of the movement and storage of goods — transport, warehousing, handling and delivery.
• Cross-Docking — A logistics practice where incoming goods are transferred directly to outbound transport with little or no storage.
• Landed Cost — The total cost of a product delivered to the buyer's door, including price, freight, insurance, duties and handling.

Frequently Asked Questions

What is Freight Consolidation?

Combining multiple shipments into fewer, fuller loads to cut transport cost per unit. Consolidation fills trucks and containers rather than paying to move part-loads, lowering freight cost and emissions. It requires coordinating timing and orders — e.g. weekly supplier milk-runs — and is a common logistics saving lever.

Can you give an example of Freight Consolidation?

Consolidating five suppliers' weekly deliveries into one truck cuts inbound freight cost by a third.

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