When you run a small business, every cent is important. The difference between a good margin and a bad margin is all about optimising costs here and there. Shipping costs offer great scope for cost optimisation given the complicated operations. Poor shipping planning can result in inflated shipping bills.
Let’s look at feasible optimisation principles to keep shipping costs down.
Maintain shipping accounts with FedEx and UPS
This makes total sense to the small business owner. Whenever a shipment has to go out, compare shipping prices between the two shipping carriers. And choose the carrier who offers the lower costs for the same service. Bifurcating your shipping between carriers serves another purpose also.
Look at the weekly performance of both the shippers and stick with the one who has better efficiency during that period.You can also compare the shipping rates offered by these carrier and pick the most economical rates
Time it right
When you have to send a shipment, you need to time the pickup or drop just right. When you call the shipper at the last moment, you will have to pay express delivery fees. Air delivery might be the only alternative left and it’s obviously more expensive. So, once you get the order ( if you are an e-commerce player), make sure you have enough time to choose an economically feasible shipping option. Act accordingly.
Match delivery requirements and fees for common shipments.
FedEx and UPS, unarguably the most often sought after shipping carriers for small businesses in the US provide assistance in the form of a small-business specialist to match the carrier fees and services with common shipping requirements for your business, such as mode of transportation and delivery timing.
Sit with the specialist and discuss things like logistics, cost and efficiency. Discuss when you would like to choose air over ground deliveries. A ground service can save a lot of money versus air. Something that has to reach the next day in the next state can be achieved through a cheaper ground delivery.
Auditing your shipments and submitting refund claims for delayed packages, can save a ton too. If you find the process of identifying delayed packages and submitting refund requests too cumbersome, simply integrate your shipping carrier account with LateShipment and eligible refunds for all the delayed deliveries will be automatically credited to your shipping account.
Let the consignee know of transportation cost charge-back policies
The customer needs to understand that you are paying so much for shipping. If you charge it to the customer, he understands that explicitly. If you bear the cost, he needs to have an inkling of how much it’s going to cost you. Some ecommerce players do not charge for standard shipping but they do collect a shipping fee if the customer wants same day or next day delivery. This is also when you decide to scrap free shipping when it’s not feasible.
Get a postage meter.
A postage meter is a portable machine with a scale that weighs packages, assesses exact postage charges and prints shipping labels. This eliminates the errors that might occur from guessing the weight of a package. You save time on paying over postage if you resort to postage meters.
