Handling cost - the cost of handling (especially the cost of packaging and mailing an order) handling charge cost - the total spent for goods or services including money and time and labor. Handling costs are costs implied on consumer other than selling price of product. It can be different for different industries. For e-commerce it can include.
Read Next. For manufacturing companies it can be coordination and integration of operations such as packing, unpacking, re-packing and movement of materials and goods over a short distance. Handling costs include coordination of operations like movement of materials, packing, repacking etc. Handler is required to integrate all such operations. Example- an E-commerce company following a Hub and Spoke model – Goods will have to be packed and made fit for transportation to avoid any damages. Then transported from one spoke to other through hub and then last mile delivery.
All these will involve packaging, transportation costs. Also man power required to carry out operations will come at some costs.
![What Is Handling Cost What Is Handling Cost](/uploads/1/2/5/4/125497093/410021954.jpg)
These costs are known as handling costs. Hence, this concludes the definition of Handling Costs along with its overview.
Reduce Touch Labor The best way to increase employee productivity and profit is to reduce the number of times a worker is required to handle material. Material handling doesn't create value – production does. Every minute spent moving, sorting, preparing or storing material equates to lost productivity. Material handling can be greatly reduced by delivering as many materials as possible directly to the production floor. For example, vendor-managed inventory can eliminate the need for receiving, inspection, sorting or storing materials.
Deploy Equipment Material-handling costs can be reduced by deploying the right equipment in the right places. Take advantage of gravity-fed movement before adding power-driven equipment, by installing gravity conveyors, chutes and slide lines. Using capital equipment like a forklift should be reviewed in combination with alternatives such as pallet jacks to determine if less expensive equipment can perform the required tasks.
Each piece of machinery should be evaluated to calculate its return on investment before purchase. This will help a company determine the point when the machine will pay for itself by decreasing material-handling costs.