7 Ways Businesses Can Lower Shipping Costs Today

Sep

Posted by admin

Category:

As demand for shipping continues to skyrocket, businesses are scrambling to head off their ever increasing expenses required to move their products. The good news is that just a few small changes in how a business ships their products can have a huge impact on the bottom line. Here are 10 ways that businesses can begin lowering their shipping costs today.

1. Work with a partner who can negotiate rates on your behalf

Volume is the main driver when carriers determine rates for their customers. Unfortunately most small and medium sized businesses do not generate the volume necessary to secure the highest discounts. However, businesses have the opportunity to align with third parties like InXpress who specialize in negotiating significant discounts on their behalf.

2. Finding the right carrier for your shipment

Not all carriers are created equal, and not all carriers will deliver your goods at the same speed, cost, or reliability. Choosing the right carrier for your shipment is important when considering how to lower your shipping costs. Some carriers specialize in specific regions, while other specialize in the transport of specific goods, yet others will focus on types of services. Understanding where carriers specialize is in important as other carriers who do not have that specialty will normally be higher in price and provide a lower quality service.

3. Consider your insurance options

All carriers are required to carry a liability policy for your shipments. However these policy will cover only a fraction of your shipments actual replacement value. Most carriers will offer supplemental insurance for your shipments but these polices are often higher in cost than 3rd party insurance options.

4. Know your accessorial and supplemental fees

Carriers on the business to make a profit, and one of the largest profit makers is the assessment of additional fees. Understanding these fees and how the carrier applies them is critical to lowering your shipping costs. While some fees may be unavoidable such as fuel surcharges, delivery signatures, and residential delivery charges, there are other fees that can be managed. Consider how you are packaging your good to avoid large package or additional handling fees. If the shipment is not critical you may want to consider a standard delivery service. Check to see if your customer can have freight delivered to dock to avoid liftgate fees. There are many more things to consider but it all adds up over time.

5. Pass the costs onto your customer

If you are not doing so already, you may want to consider passing your shipping costs onto your customers. It is quite customary for purchasers to know they will be responsible for shipping costs. However if you are competing with a big-box or larger competitor, this may not be an option.

6. Consolidate your shipments

Major carriers including DHL and UPS offer breakbulk pricing which allows for lower prices when shipping a certain number of packages under the same waybill from the same origination. There are also opportunities for importers to consolidate multiple shipments into a single container in order to avoid redundancy in fixed import costs.