If you’ve heard of pool distribution but are unsure if it’s the right “fit” for your company, these insights can help. Whether you’re familiar with the pool concept or it’s a new term for you, understanding its value can help your business significantly.
When properly used, the pool distribution strategy can help reduce shipping costs and create a faster and easier transit for your packages.
What is Pool Distribution Logistics?
Pool distribution allows you to “pool” multiple shipments that are shipping to the same geographic region. Here are the four steps that are part of the pool distribution process:
Step 1
Your packages are pooled together into single or multiple truckload shipments (depending on shipment size).
Step 2
Your shipment is delivered to the distribution center or “pool points.”
Step 3
Your packages are sorted and segregated to their destination.
Step 4
The packages are loaded onto local trucks for final delivery.
Five Reasons Pool Distribution Will Benefit You
- 1
You’re already utilizing LTL Shipping
If you’re regularly using LTL for shipments, then pool distribution might be an excellent option for you.
- 2
Time sensitive deliveries
Many LTL carriers have multiple stops on route to their final destinations, which increases the potential delivery time, possibility for damage and threat of loss. Pool shipments have minimal stops in between since they are traveling to the same geographical region.
- 3
Better customer service and insights
A strong pool distribution program requires robust technology to provide real-time status on all of your freight. With RXO Connect™, shippers have instant shipment information, via web access or event notification. Localized service carriers provide the most up-to-date transit and detailed shipment information from pick up through to delivery, with complete visibility into your shipment status.
- 4
Increase cost savings
Typically, LTL receives the best rates for high-volume shipments. If you’re using LTL for small volume shipments, you might be losing more money than you are saving. When using the pool distribution solution, multiple shipments are “pooled” together into a single load. Effective pool distribution will help to cut costs and provide more cost-effective transportation solutions.
- 5
Reduce your carbon footprint
When you pool your shipments, you can reduce the need for multiple trucks on the road, more effectively utilizing transportation resources and reducing total carbon footprint.
Whether your company is looking for one or all of these solutions, an effective pool distribution solution can be customized and configured for any shipping needs, based on what makes sense for your business. A solutions expert can help look at your current shipping model and make strategic recommendations based on a variety of options and solutions to help provide an efficient operating model.
Industries that can benefit from Pool Distribution
Pool distribution plays a significant role in the retail industry. But many industries can benefit from pooling their shipments with the right approach and solution that can take advantage of pool distribution.
- Automotive
- Consumer packaged goods (CPG)
- Food and Beverage
- High-Value Commodities
- Industrial Products
- Packaging Materials
- Medical
Pool Distribution vs. LTL
While both are shipment methods, there are significant differences between pool distribution logistics and LTL shipping.
With pool distribution, your packages going to the same geographic region are combined into single or multiple full truckload shipments. Unlike LTL, with pool distribution, you will receive better shipment visibility and a higher percentage of on-time shipment delivery. When comparing the two, there are several factors to consider pool point vs LTL.
- 1
Pool Distribution can typically be the most cost-effective option
- 2
You can set your delivery day and time, allowing you to ensure enough labor is available on delivery day (saving you time and resources).
- 3
Allows for short-term warehousing; we can receive the shipment on Monday and deliver on Thursday. In contrast, LTL provides no control on delivery time. It will deliver the day after the delivering terminal receives the product.
- 4
We inventory each shipment and will prepare an overage, shortage, and damage report.
- 5
If a package becomes damaged, we can repackage or hold it until disposition is provided.
- 6
Pool distribution allows for delivery of loose cartons or pallets as needed.
- 7
Each carton is scanned to verify delivery, reducing shrink.
- 8
Linehaul cost savings allows shipment of all products to the regional pool point, filling trailers and reducing overall shipment costs.
“Delivery integrity. With RXO Connect, we have visibility of our shipments, we can confirm shipments are intact and delivered in full even with a designated delivery window”– RXO customer on why their business prefers pool distribution over LTL.
Learn more about RXO’s Pool Point Services
Working with a trusted and professional 3PL can help increase your pool distribution success. RXO’s Freight Forwarding team has more than 130 years of domestic transportation and pool point distribution solutions development, specializing in customer facing, customized solutions tailored to the specific customer need.
We utilize a customized network of carriers to help companies to utilize the greatest advantages available through pool distribution. After reviewing a client’s specific transportation needs, a through evaluation on where improvements can be realized is completed and the client is provided a competitive pricing plan, along with opportunities to eliminate redundancies, specific insights to reduce potential damages, how to protect the client’s organization from shipping liability, and more.
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