How a Major Retailer Saved $300,000 in Hidden FF&E Costs

Are hidden transportation costs hurting your FF&E process? See how you could save significantly by changing your current process.

Freight-related fees are a normal part of getting fixtures, furniture, and equipment (FF&E) into your remodels, conversions, and new-builds. But if you rely on vendor-direct, just-in-time delivery to do that, hidden costs and price leaks may unfortunately be standard procedure.

But they don’t have to be. Consider, for example, how one major retailer saved $300,000 in transportation costs over the course of 105 store projects just by switching to an FF&E consolidation model.

In the following, we’ll not only explain how consolidation made those savings possible but also explore various transportation-related costs you may be paying—when you don’t need to be.

Cost No. 1: Paying too much on shipping

So how did that retailer from above manage to save hundreds of thousands of dollars? Before they switched to an FF&E consolidation model, which we’ll explain in a moment, they were using a conventional, vendor-direct approach.

More often than not, that meant separate, store-specific FF&E orders—hundreds of them—were arriving at store sites via a less-than-truckload (LTL) network. This was both inefficient and expensive because it required more trucks on the road hauling smaller amounts of freight.

A less-than-truckload (LTL) shipping model means a much higher cost per pallet.

The reality is that this is an all-too-common scenario for many retailers. “When you ship using an LTL model, it’s going to mean paying a much higher cost per pallet,” says Phil Vines, Director of Business Development for Store Opening Solutions. “And you’d be surprised how much that can add up with dozens of store projects.”

How FF&E consolidation saves you money

How FF&E consolidation saves you money

FF&E consolidation is a strategic approach where you partner with a consolidator who receives and warehouses FF&E for future projects. The consolidator also inspects, organizes, and ships FF&E to specific sites precisely when needed.

Your warehouse space empowers you to buy in larger volumes for multiple stores all at once

Importantly, your warehouse space empowers you to buy in larger volumes for multiple stores all at once. That leads to savings not just from bulk rates but also from the cost-effective use of more full truckloads (FTLs).

And when it’s time for your consolidator to ship to a store site, you’ll likely be saving money yet again thanks to FTL shipping. That’s because your consolidator can fill up a truckload with your fixtures and with the store supplies you’re warehousing with them—everything from shopping carts to registers to entrance carpets.

Cost No. 2: Wasting money on callbacks (and even missing out on revenue)

Orders in an LTL shipping network are subjected to numerous forklift touches

An expanding store network means an increase in FF&E orders. But when those orders go through an LTL shipping network (see above), they’ll likely be subjected to numerous fork-lift touches as they’re loaded and unloaded repeatedly at various shipping hubs. 

This process not only compromises the reliability of just-in-time deliveries but also creates conditions for more lost and damaged FF&E. And if items can’t be installed in the designated project window, you may have to keep installers longer (if that’s even an option). Or, you’ll need to call them back. Neither scenario will be cheap.

Even worse, if store-critical FF&E items like cash wraps, registers, or shopping carts don’t arrive on time, you might have to push back store opening dates. And that’s revenue lost forever. “But that’s the risk you face when you live and die by perfectly timed vendor-direct deliveries,” says Vines.

How FF&E consolidation saves you money

FF&E consolidation allows you to place vendor orders well in advance. Those items are then shipped to your consolidator, who also inspects the FF&E for missing or damaged items.

The trailer door isn't open again until at the store site.

Now, when you give the word, your consolidator picks your FF&E for store-specific orders and ships them for on-time delivery. “When they close that trailer door, it’s not opened again until it’s at the store site,” says Vines. 

All of this helps create the circumstances for headache-free deliveries that enable your installers—and your project—to stay on (or even ahead of) schedule.

Cost No. 3: Resorting to expedited delivery fees and reconsigning costs

Remember that old slogan, “When it absolutely, positively has to be there overnight?” Sure, if store-critical FF&E are missing or damaged, you might be able to find a way to get what you need shipped at breakneck speed. But it’ll cost you.

“In situations where you’re that desperate, cost concerns go out the window. The only thing you care about is finding a way to get what’s needed ASAP,” points out Vines. Unfortunately, it may not take many of these expedited deliveries to blow up a budget.

And what about when trucks roll with a vendor-direct order, but the project schedule has suddenly changed? Now you need to act fast and possibly pay through-the-roof reconsigning costs for a temporary storage solution.

How FF&E consolidation helps reduce the risk

How FF&E consolidation helps reduce the risk

With FF&E consolidation, you place your store-specific order with your consolidator, who already has everything your site needs. Moreover, the consolidator audits that order before delivery, greatly reducing on-site surprises that prompt desperate moves and rushed shipping.

And the possibility of reconsigning costs? That’s a lot less likely because any order en route to a site can always be directed back to the warehouse if needed, where your consolidator will unload your FF&E at no extra cost.

Explore ALL the cost-saving possibilities

You’ve just seen how FF&E consolidation can reduce transportation-related cost risks and, in some cases, even eliminate them. But there are actually a number of other ways consolidation creates cost-saving opportunities for you. To see the real savings potential for your specific FF&E program, make sure to check out our free FF&E program audit.

About Store Opening Solutions

We support the strategic vision of retail organizations with focused expertise in the consolidation and installation of store fixtures and equipment. Our dedicated team embraces your vision and partners with you to create appropriate inventory control processes.