A successful kickstarter or any other crowd funded campaign is a hard thing to achieve and it certainly deserves a pat on the back for everybody in the team that took an idea and gave it shape, but as you may have already realized this is only the first significant step towards achieving product greatness. Up until this point, getting funded for your wonderful idea would have been the primary concern of everybody on your team, but getting past that huge initial hurdle suddenly shifts focus towards other neglected but equally important concerns. A prime example of this would be shipping your awesome finished product to the hands of your enthusiastic Kickstarter supporters who are eagerly awaiting delivery.
In the startup phase, where every penny goes a long way in making a great company, shipping is often a neglected area where a lot of money is left on the table by companies new to the game. Fortunately, we guys at LateShipment.com have been around long enough to know all the tricks played by FedEx and UPS to fatten their wallets and we are here to guide you around their shenanigans through this blog post, where we discuss the various important shipping considerations that could save you a significant chunk of money for your company.
Negotiating Rates
Caveat Emptor, should probably be mentioned right next to prices quoted by UPS and FedEx because often what you see as the price is something that can be negotiated heavily based on the volume of shipments. This is what all big companies do to actually ship stuff at a fraction of the displayed cost. With a successful Kickstarter project, this is definitely the club you belong to, so its time to pick up the phone, call UPS and FedEx and ask to have the area rep pay you a visit.
Picking the right delivery methods
The general rule of thumb that most shippers use is, if it needs to get there slow, use ground and if you need it to get there faster, use overnight, two day or three day shipping. The rates are also structured accordingly, with Ground being the cheapest and Overnight being several times more expensive than Ground. This sound perfectly logical but the dirty secret FedEx and UPS don’t want you to know is that for several locations, depending on where you are located Ground shipping may get there equally fast or faster than overnight or 2-day shipping, while costing several dollars less. For example, a 2 pound package shipped Ground from Orlando, Florida to Columbus, Ohio costs $24 for 2-day shipping but actually gets there in 2 days Ground and costs only $11!!. The best way to get around the carriers tricks in this regard is to refer to the delivery maps. Surprisingly it is this belief that both FedEx and UPS rely on to make some extra money. The dirty secret is hidden here in the actual delivery map, which every business should refer to a lot when determining what service to use for delivery to that region.
Paying attention to package dimensions and weights
As a shipper, you would assume that the cost of shipping is directly proportional to the weight and volume of the shipping container used, however this is hardly the case in real life. Both with FedEx and UPS, you may end up with drastically different shipping charges, with a slight change in weight or volume of the package being shipped. The best way to ensure that you are not caught paying more is to include shipping cost considerations when designing packaging for your product. We have seen several cases where a few inches has saved several dollars in shipping costs for the product.
Shipping audit and claiming refunds
Both FedEx and UPS have a delivery guarantee in their contract and this guarantees that every time a package is delivered late, even by a minute, the shipper is eligible for a complete refund of all shipping charges. FedEx and UPS are known to be late about 6-8% of the time but usually get away with it as more than 95% of these late deliveries are not submitted for a refund. The main reason for the abysmal number of refund claims is the ridiculously complicated and time consuming process that FedEX and UPS have for submitting these claims. This complexity is understandable as the unclaimed refunds net close to $2 Billion in revenue for FedEX and UPS every year, but this should not deter you from reclaiming your rightful shipping refunds. If you have enough time on your hands, the refund process can be performed manually for every shipping invoice you receive or if you want to make things simpler you can always sign up for an account with us, LateShipment.com to automate this entire process without taking even a minute of your time. Whichever option you chose, refunds are a surefire way of reducing close to 8% of your shipping costs and it is definitely to your advantage to leave no refund unclaimed.
Last but not the least, always keep in mind that every penny saved on shipping adds directly to your profit margin and we know how every penny at this stage goes towards making your product more awesome. We hope that the things discussed here help you deliver your great product to customers in the most cost-effective manner and cant wait to see your company succeed.
