Why You Need to Ask Yourself Critical Questions about Your Oil and Gas Transportation

Posted on: 10 March 2017

Any commercial operation that relies on moving product knows that efficient logistics is the name of the game. If you're in the oil and gas industry, you should know that this is especially important, as these crucial products are distributed around the country. However, you may be inadvertently making some mistakes or have fallen into bad habits that could one day create havoc for you, your suppliers or your customers. What are some of the critical questions you should be asking yourself about your oil and gas transport instead?

Is Precision Too Much?

Many people consider that any logistical operation should be run on a "just-in-time" basis. It is anticipated that this could cut down on storage costs, keep prices more realistic and keep services relevant. However, this type of pressure can also lead to availability issues and can conversely drive up quoted prices accordingly.

How much lead time do you consider to be ideal, when dealing with your shipments? Many carriers don't have the ability to drop everything else and deal with your last-minute requirement and anything that is placed with short notice could even be rejected due to a full quota. There's a sweet spot to be found, especially when it comes to the premiums that may be quoted for truly last-minute requests.

Are You Getting The Best Deal?

It always pays to "shop around" when it comes to a choice of shipping company. Competition is a good thing, and there are always organisations that can give you a quote for your potential business. This doesn't mean that you should compromise on your level of service though, or go for longer distribution times just because it costs less.

Do You Have the Best Relationship?

Having said that, it's probably not a good idea to be changing companies all the time, either. A reliable carrier is worth its weight in gold, especially one that understands your operation and your particular foibles. Remember also, you need to keep up with your carrier's insurance, to make sure that they are always covering the appropriate risks.

Are You Keeping Them Waiting?

Efficiency is everything and this extends to loading and unloading of your product as well. Once you have arranged for shipment, you must ensure that the product is ready and waiting for the carrier upon their arrival. If there is lag time at either end, then one way or the other you will find that it increases your transportation costs.

The Bottom Line

These and other issues can add to or detract from the bottom line. You should discuss your particular circumstances and requirements carefully with a transportation company to see if you're being best served.