If your business can not afford to hire a 4PL company like Millennium Logistics to create an effective and efficient shipping strategy. Here are some tips to help your business save money on shipping:
1.) Match delivery requirements and fees for common shipments
Once you’ve chosen a shipping service provider — such as UPS, FedEx, DHL or the U.S. Postal Service — work with its small-business specialist to match the carrier’s fees and services with common shipping requirements for your business, such as mode of transportation and delivery timing. Businesses that don’t work with their carrier to map out shipping criteria can spend more in fees than those that do.
2.) Establish transportation cost charge-back policies
Let customers know when they will pay for shipping and when your business will. For example, three-day parcel service may be the standard level of service that’s paid for by the company, and any premium services — such as overnight air or two-day parcel — are paid for in part or entirely by the customer. Once these policies are set, inform your sales and customer services staffs, as they generally deal directly with customers.
3.) Track carrier performance
One way is to have your carrier keep a “scorecard,” which usually tracks service and cost. Service factors can include pickup, delivery, response to customer service inquiries by shipper, access to on-line status data, accuracy of that data, meeting pickup or delivery appointment times and meeting agreed-upon in-transit times (from time of pick up to time of delivery).
Cost factors usually include baseline by weight or distance, cost by service level (premium overnight or expedited, standard service, for example), non-essential fees such as special handling or meeting time-specific delivery times. Work with your carrier to identify and resolve lapses or failures in service or cost performance. Anderson also recommends soliciting input from your customers.
4.) Know when to consolidate
When sending shipments weighing between 150 pounds and about 20,000 pounds (usually referred to as “less than truckload” shipments, or LTL) consider working with a freight consolidation service, which will combine yours with other shipments to create a full truckload. Less than truckload or container load rates are usually much higher than full truckload or container load rates. LTL shipments have to go to a truck terminal to be consolidated by the carrier into a full truckload for shipment. If the small business has a full truckload shipment, then the carrier can pull up to the company’s terminal and load the truck and go, saving time.
5.) Use a postage meter
A postage meter is a portable machine equipped with a scale that weighs packages, assesses exact postage charges and prints shipping labels. Systems like these can help eliminate the need for mailers to guess the weight of a package and purchase additional postage. Using a postage meter can eliminate over-postage and is much easier than going directly to your shipping carrier and waiting in line.
In closing, shipping merchandise can be one of the most complicated operations for any small business. Poor or no planning can result in owners overpaying, as well as losing sales if the company can’t provide consistent and cost-effective delivery to customers. Regardless of whether or not you can afford to hire a 4PL company to improve your shipping process, make sure you are taking a closer look at your shipping process.
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