Certified Supply Chain Professional (CSCP) Practice Exam

What is the primary function of consolidators in shipping?

1. To negotiate with suppliers for better prices

2. To combine small shipments into larger ones to reduce costs

3. To provide storage facilities for goods

4. To act as freight forwarders for expedited services

The correct answer is: To combine small shipments into larger ones to reduce costs

The primary function of consolidators in shipping is to combine small shipments into larger ones to reduce costs. This process is known as consolidation and is essential for optimizing shipping operations. By grouping several smaller shipments into a single larger shipment, consolidators can take advantage of economies of scale, which often leads to lower transportation costs per unit. This is particularly important in a supply chain context because shipping costs can be a significant portion of the total logistics expenses. By consolidating shipments, businesses can minimize freight costs and enhance efficiency. This approach is beneficial not only for the consolidators but also for shippers, as it can facilitate better shipping rates and ensure timely delivery by maximizing carrier utilization. Other functions mentioned in the alternatives do play roles in logistics but do not represent the primary objective of consolidators. Negotiating with suppliers primarily falls under the procurement function, providing storage facilities relates to warehousing logistics, and acting as freight forwarders pertains to managing the transportation of goods rather than specifically consolidating shipments.