Freight management is the management of a company’s freight. It is a management system that specializes in movement of freight or goods from one place to another.

Freight management can be carried out in both international level and domestic level. It is international when goods are moved from one country to another country and it is domestic when goods are moved from one place to another within the same country.

Any freight management company relies majorly on transport to carry out their businesses. In freight management, proper decision must be taken in order to determine the mode of transport that is appropriate for a particular freight. However, there are 3 factors that must be considered before a freight management department or company decides on a types of mode needed for a particular freight. The factors are:-

  1. Time factor
  2. Cost factor
  • Product factor

It is important to note that freight management cost is used to save business time and money in the entire freight operations. It is possible that transportation alone may account for almost 50% of an average company’s cost if not properly checked. This explains why freight management is important to an organization; it helps to keep freight cost lower for an organization which directly affects the bottom line and the price paid by all customers for a particular goods or supply.

In fact, freight management appears to be a strategic system an organization needs to optimize the efficiency of freight and commercial transport.

Benefits of freight management

The benefits of freight management to an organization cannot be overemphasized. Such benefits among others include:

  • It enables the organization to increase profitability.
  • It enables the organization to increase production.
  • It gives administrative support to an organization
  • It gives better inventory management; lower inventory level and reduce carrying costs.
  • It improves on-time delivery.
  • Proper material handling; less damage and supports efficient receiving.
  • It gives immediate notification of any disruption.
  • It gives customers satisfaction.
  • It improves the company reliability.
  • It uses mode of transport more efficiently with economic value and goals in view.
  • It protects the good from damage during transportation.

However, poor management of company’s product or goods brings a great loss to the organization. I have seen many products of an organization that suffered heavy damage in transits due to poor transportation and bad road. Proper freight management will definitely reduce this high risk because success of freight management is linked to the efficient use of transportation. Nonetheless, since the essence of freight management is to increase efficiency, reliability and to minimize freight cost. Hence, it will not be understatement to say that freight management is inevitable to any manufacturing company.