Optimizing Zoro's Freight: Balancing Cost & Service

Hassan Qureshi is serving as Senior Director of Logistics & Fulfillment at Zoro.com in Chicago, Illinois. With a strong background in both computer science and operational management, he excels in guiding organizations through controlled disruption to achieve enhanced performance and customer experience. His holistic approach ensures alignment across the value chain, always prioritizing what is best for the organization. 

Lucas Marion is a senior logistics analyst at Zoro US with over three years of experience in global logistics and supply chain management. A Lean Six Sigma Green Belt Professional, Lucas excels in optimizing processes, driving operational efficiency, and fostering cross-functional teamwork. With certifications as a UiPath Certified RPA Associate and currently pursuing PMP certification, he demonstrates strong learning agility and leadership initiative.

Through this article, Qureshi and Marion highlight the benefits and challenges of using a freight forwarding solution for a growing eCommerce business like Zoro.

In the fast-paced world of eCommerce, logistics and shipping are crucial for ensuring customer satisfaction and operational efficiency. As Zoro’s business has grown, we initially relied on a single carrier to handle all our Less Than Truckload (LTL) and Full Truckload (FTL) shipments. While this approach offered simplicity, it eventually led to escalating costs and service gaps that were hard to ignore.

Strategic Shift in Freight

To address these challenges, we transitioned to a freight forwarding solution. Unlike relying on a single carrier, Zoro leveraged a network of carriers through this approach, offering more flexible and cost-effective solutions. This shift marked a significant improvement in our logistics strategy. Not only did it reduce shipping costs, but it also helped close service gaps that had previously disrupted our operations. 

By tapping into a vast network of carriers, we could select the best shipping options based on factors like cost, speed and reliability, ensuring more efficient deliveries with fewer disruptions.

Leveraging Supply Chain Expertise

Beyond optimizing routes and reducing costs, partnering with a freight forwarder allowed us to benefit from their extensive supply chain expertise. This partnership made our operations more efficient and reliable, enhancing customer satisfaction and strengthening brand reputation. Furthermore, their industry knowledge enabled us to make informed decisions and navigate disruptions smoothly.

Pandemic Resilience: A Test of Strategy

The value of our decision to partner with a freight forwarder was particularly evident during the pandemic time. As supply chains faced unprecedented disruptions, securing shipping lanes became a significant challenge. The freight forwarder’s agility and extensive network allowed us to obtain shipping lanes when many others struggled. Their ability to adapt quickly to changing circumstances ensured that our operations continued with minimal disruption, proving crucial in maintaining service levels during a period of intense transportation pressure.

Data Integration Challenges

Despite the many advantages, one significant challenge remains—data integration. In today’s digital age, real-time tracking and visibility of shipments are essential. However, integrating the carrier’s tracking data with our existing systems has proven complex. Each carrier within the freight forwarder’s network uses its own tracking system, with varying formats and levels of detail, making it difficult to consolidate this data into a cohesive platform. This lack of standardization has caused some issues and a constant and deliberate effort to bring uniformity is needed.

“As we refine our processes and address these challenges, we are confident in our ability to deliver even greater value to our customers and stakeholders.”

Vendor Coordination Challenges

While the solution has brought many benefits, it has also brought another challenge for our vendors. Using a single carrier was straightforward, with one pickup arranged on a specific day. Now, vendors must take additional steps on the portal to coordinate shipments. This can lead to multiple carriers showing up on multiple dates for pickups, which could create more hassle. Although this requires more coordination, the overall flexibility and cost savings outweigh these challenges.

Moving Forward

In conclusion, while the shift from a single carrier to a multicarrier solution has significantly improved our logistics operations, our journey continues. As we refine our processes and address these challenges, we are confident in our ability to deliver even greater value to our customers and stakeholders.