Insights from Royal Foods Distribution

The Rising Tide of Shipping Costs

In recent years, businesses across the global supply chain have faced steadily increasing shipping costs. Whether you’re a multinational importer or a local distributor, the financial strain is real. At Royal Foods, we understand the challenge – our role is not just to adapt, but to help our clients remain resilient in this shifting landscape.

What’s Driving Shipping Costs Increasing?

• Port Congestion

Major U.S. ports like Savannah and Los Angeles continue to suffer from congestion due to labor shortages, equipment delays, and high cargo volumes. This congestion translates into longer wait times and higher costs from demurrage, detention, and storage – especially detrimental for time-sensitive goods like refrigerated products.

• Fuel Price Volatility

Fuel prices are a core cost driver in logistics. The transportation sector is especially vulnerable to fluctuations in diesel and marine fuel prices, which can be triggered by global conflicts, policy changes, or even natural disasters. For cold chain providers like Royal Foods, these increases also affect the energy required to maintain controlled temperatures throughout the supply chain.

• Container & Equipment Imbalances

Shipping lines are still struggling to reposition empty containers where they’re needed. Inland areas and export-heavy regions often face a shortage of equipment, forcing companies to lease containers or pay steep surcharges – costs that inevitably flow downstream.

• Regulatory and Compliance Costs

Complying with USDA and FDA standards is critical for any business dealing with food products. At Royal Foods, we specialize in regulated imports, and while we’re proud of our adherence to strict safety requirements, these protocols come with added administrative and operational costs.

• Global Disruptions

From pandemics and labor strikes to extreme weather events and international crises, global supply chains are more susceptible than ever to disruption. These events can instantly constrict capacity and push freight rates higher, with little warning.

How Businesses Can Respond To Increasing Shipping Costs

• Plan Ahead

Proactive logistics planning is no longer a luxury – it’s a necessity. Royal Foods helps clients forecast demand and plan for seasonal surges, reducing last-minute scrambling and avoiding premium rates tied to rushed deliveries.

• Use Cold Storage and Cross-Docking

By leveraging solutions like our 3000-pallet cold storage and cross-docking facility in Santa Clara, customers can minimize idle inventory time, consolidate shipments, and avoid extended storage charges. Products stay fresh and keep moving, reducing both time and cost.

• Work with a Knowledgeable Logistics Partner

Partnering with experienced logistics providers – especially those equipped to handle USDA/FDA cargo – can prevent compliance issues that result in costly shipment delays. Royal Foods, with our I-house number I-95, offers expertise in cold chain management and regulatory documentation, helping clients stay ahead.

• Negotiate and Automate

Where possible, negotiate long-term or volume-based rate agreements with carriers. This can lock in favorable pricing and provide budgeting certainty. Additionally, using transportation and warehouse management software can help track goods, optimize routes, and reduce errors that lead to extra fees.

• Turning Challenge into Opportunity

While no company can fully escape rising shipping costs, those that prepare, optimize, and partner strategically can minimize their exposure. At Royal Foods Distribution, our mission is to help clients navigate this complex terrain with dependable service, regulatory expertise, and cold chain solutions tailored to their needs.

Contact Royal Foods – Cold Chain Logistics Experts

Royal Foods Distribution
2026 Martin Ave, Santa Clara, CA 95050
📞 Phone: (408) 560-1628 or (408) 368-0408
📧 Email: info@royalfoodsdistribution.com
🌐 Website: www.royalfoodsdistribution.com

Whether you need cold storage, cross-docking, or USDA-compliant handling, we’re here to help you navigate the challenges of modern logistics.