Cut the Shipping Costs with these Handy Tips

eCommerce Shipping with eCourierz

Shipping is the backbone of eCommerce; keeping shipping costs down and quality up is crucial factors in maintaining profitability and retaining customers. Herein lays the challenge for eCommerce business owners – shipping rates are on the rise.

Before going into depth, I would like to say that Shippers must realize that the amount of effort put into performance management is related to the ability and success rate of (parcel) transportation cost control.

If you know your shipments and their costs in details, will always help to abstract a profitable amount of your parcel transportation costs.

1. Carrier selection
Most carriers — whether express, parcel or freight — provide discounts to businesses that routinely ship or receive merchandise. The old adage “everything is negotiable” is an immutable fact when it comes to shipping fees; however, the challenge for small businesses is how to go about obtaining the same, steep discounts that are normally reserved for large businesses and heavy freight shippers.

Criteria for Carrier Selection

One strategy a small business should consider is joining an industry trade association. Oftentimes, industry trade associations are able to aggregate the buying clout of their members to negotiate and provide better shipping rates to all the businesses that participate in the program.

Another approach a small business can take is to work directly with a third-party logistics provider (3PL), or even directly with their carriers, to see if they can get better discounts than they presently have. Often times if you simply ask for better pricing, you will get it because 3PLs and carriers are always looking to retain and grow their business. Be prepared to share examples of shipping invoices or manifests with your 3PL or carrier to help them best assess your shipping patterns and provide you with the best pricing.

2. Consolidate shipments
As a general rule of thumb, one big order ships for less than three smaller orders. That means small businesses should consider consolidating multiple orders into a single shipment whenever possible and always strive to minimize the number of packages it sends. Often, shipments are arranged as they come in from sales or order processing. However, a little planning and visibility go long ways toward shipping savings.
Consolidate Multiple orders into a single shipment

Consolidating orders provides additional benefits to both shippers and receivers of small package and freight shipments, including:
  • Reduced shipping supply expenses
  • Greater fuel efficiency (better on the environment)
  • Less time needed to receive, handle, and restock orders
Consolidate your items in single box

One master plan for shipment consolidation is to create a simple shipping plan that takes into discussion all of your business rules for carriers, weight breaks, orders, and shipping contacts. Distribute this guide to your vendors and discuss it with your customers. Place multiple packages on one shipping label and negotiate carrier rates by total weight rather than box weight. The larger the weight of the shipment, the lower the cost per KG.

3. Use the Correct Shipping Mode & Service Level A common dilemma for small businesses is choosing the appropriate shipping mode to use for their important shipments. Shipping mode choices include LTL freight, small package, surface, air, ocean, rail, intermodal, and others. When deciding the use a small package or LTL freight carrier, for instance, shippers must consider the weight and characteristics of the shipment, the shipment destination (e.g., business, residence, etc.), service needs, pricing and fees, and loss or damage concerns.

4. Design a standardized format for RFP's
RFP means a request for proposals. A standardized RFO format offers efficiencies for both lotteries and suppliers and it frees up time and resources for other productive activities. This way you can compare pricing & information from your carriers.
Prepare standardized proposal format

5. Audit your parcel invoices when your parcel volume reaches (over) thousands of shipments per month then Parcel Shipping invoices often contain errors. Make sure that your organization has a solid freight audit, payment solution, and API Integration. Overlooked or ignored mistakes can cost you a fortune.

6. Include Entry Taxes
Ensure to include the Entry Taxes/Octroi in your Invoices and collect the money from the consignee well before. This will reduce your overall costs further.

7. Use Shredded Paper Instead of using other packing peripherals, use shredded paper.
Shredded Paper used for Packaging

8. Cut Down on Shipping Materials The biggest factors in determining shipping costs are weight and distance. It’s usually not practical to change the distance between you and your customers in other countries, but you can impact the weight. Using the correct box size and lightweight packing material will help to cut down on shipping costs. With more carriers using dimensional pricing, this is all the more important. And, of course, recycle packing materials when possible.

Way to stick label on the parcels

Final Point:
A third party shipping service, like eCourierz.com, allows you to find the lowest rates and take advantage of commercial pricing with no subscription fee. This makes for a more profitable, and less complicated shipping process.

eCourierz.com  provides live shipping calculation to ensure you get the best price while still using trusted shipping services. You are able to compare and select the best rates immediately. It also gives you access to a wide variety of shipping services and discount pricing without having to go through additional sign ups or approvals.

By taking advantage of services that allow you to minimize your shipping cost, you will maximize the profitability, maintaining your edge in the competitive world of eCommerce. Contact us today to make sure you’re getting the most value out of your eCommerce business.

Comments

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