Next week I will be speaking at Parcel Forum 15 in Chicago, IL regarding Optimizing Your Parcel Shipping. For those of you that will not be able to make the show, or just want a sneak preview, I thought it would be good to write a brief blog highlighting some of what you can expect of the discussion.
In today’s environment, it is more important than ever to optimize your shipping. For companies shipping products direct to consumer, parcel spend is one of the highest costs in their operation. Finding ways to drive costs down, while still maintaining the service level your customers expect, can be difficult. Finding the carrier strengths, adapting to changes and leveraging certain technology are all great ways to help optimize your parcel shipping and ultimately lower your costs.
Leverage Carrier Strength to Meet Requirements
While FedEx and UPS have service levels that are extremely comparable, other companies such as USPS and DHL offer a different level of service. USPS Priority Mail has made a strong push to earn much of the UPS and FedEx business since the dim weight expansion over the last year. USPS Priority mail now offers 2-3 day delivery times to the US. For many zones, this is cheaper than a UPS/FedEx Ground shipment and significantly cheaper than a UPS/FedEx Expedited shipment.
Understanding that some carriers are stronger than others in certain areas can help tremendously when it comes to optimizing your shipping. Do not stick to just one carrier and their service offerings. Look for ways to implement multiple carriers depending on how and where you are shipping your products.
Don’t Stick with Status Quo
Don’t think that just because this is the way things have always been done that it is the right way or even the best way to handle your shipping needs. Begin to think outside the box on ways that you can drive shipping costs down. The best way to learn new carrier offerings or changes to a carrier service is to work closely with your local representative. FedEx, UPS and USPS all have local service reps who are able to assist you with your business shipping needs. Find out who that person is and set up at minimum an annual meeting. This will help you understand what they have to offer and while you might think they want to screw you over on price, they actually want to work hard to keep your business and lowering costs is the best way to do that.
In order to optimize your shipping in a way that is going to save you significant money, it is also going to take some time and even technology. Unless you are going to want to manually rate shop every order that ships out of your facility between several different carriers, you are going to want to ensure you have the technology to help automate this rate shopping. While it is not necessary to have the technology, it can be very helpful. Finding a multi carrier shipping software can help ensure that you are able to maximize your effectiveness in finding the best method and the human error element out of the equation.
When you are optimizing your parcel shipping, it is easy to get extremely in depth and over complicate things. The best advice would be to start slow by implementing 1 or 2 different carriers and services, slowly growing into additional service levels and offerings. If things are not done correctly, it can have a negative effect and hurt your brand.