5 Ridiculously Easy Ways to Reduce Your Shipping Costs
12/21/2020 — Jen Deming
In a time where managing business operating expenses is extra important, one of the first places you should look is reducing shipping costs. But analyzing your small package shipping for areas of improvement can be a time-intensive, detail-oriented process. Not everyone has the time to audit invoices and compare rates. For those who want to get the job done quickly and easily, you’re in luck: there are five quick small pack hacks that smart shippers can easily implement to help reduce costs.
- Obtain discounts with carriers
Lots of shippers don’t realize that the pricing structure you are currently using with your carrier may be negotiable, and there are different types of discounts that your account may receive. FedEx and UPS often offer discounts for new accounts when created online, but shippers beware: these discounts are usually temporary, and your pricing may fluctuate based on terms and conditions. You may lose the discounts entirely if you aren’t meeting shipping minimums and your pricing is subject to change at any time.
The more you ship, the better the discounts you’re likely to receive directly from FedEx or UPS. However, even if you have a lower shipping volume, there are still ways for you to obtain discounts. If your business belongs to a trade association or a local chamber, you may have access to discounted rates through your membership. PartnerShip manages over 130 association shipping programs that offer FedEx discounts. If you’re a member of an industry group, look into your member benefits or reach out to our team to find out if you’re eligible.
Take advantage of free packaging
The packaging and supplies you need to properly contain your shipments are important, but can be costly. However that doesn’t mean you should skimp on new materials or reuse old packaging – doing so can compromise the integrity of your shipment and increase the risk of damage. The good news is, some carriers offer free shipping supplies to help ensure your package is secure. Both UPS and FedEx offer free packaging supplies for customers that you can order online and have delivered, free of charge. With free envelopes, packing tubes, boxes, and poly bags, you can be sure your small package shipment will travel safely to its final destination, all while creating some space in your shipping budget.
Make the most of Multiweight and Hundredweight options
From insurance plans to your cable bill, everyone knows you can save money from bundling. That same principal can also apply to your shipping. Both FedEx and UPS offer options for customers who are shipping multiple packages to the same location that can help you save money versus the rates you would pay if they’re considered individual packages. For businesses shipping frequently to the same locations, FedEx multiweight pricing is an efficient and cost-effective service option. UPS has a similar program called UPS Hundredweight.
There is a catch for shippers interested in these options — it isn’t available to just any business. FedEx Multiweight and UPS Hundredweight must be negotiated into your contract, or offered as a part of comprehensive shipping program, like the association programs managed by PartnerShip.
Avoid dimensional weight pricing
To combat the increase in bulky packages entering their systems, FedEx and UPS have implemented dimensional (DIM) weight pricing. With DIM weight pricing, cost is calculated based on package volume, rather than weight. The higher the volume, the more space it takes up in delivery vehicles, which means there is less room for other packages. If a package isn’t particularly heavy but is taking up a lot of space, that’s costly for the carriers.
After calculating your DIM weight, measure the result against your package’s actual weight; the greater of the two will become your billable weight. The best way that you can offset volume-based pricing is to take a hard look at your current packaging procedures. Unused space is a cost-conscious shipper’s worst enemy, so don’t use a package that’s oversized for the product inside and consolidate your orders when possible to ensure you’re not wasting space.
Take control of inbound shipping
Another way to save on small package shipping is by taking control of your inbound shipping procedures. It’s common practice for many businesses to allow their inbound small package orders to be arranged by the vendor. But often times that leads to higher order costs for you. By instructing your vendor to ship through your account, you can reduce your costs through a few simple steps:
- Review your vendor invoices to determine whether you have access to better pricing through your FedEx/UPS account vs. your vendor’s account.
- Create routing instructions that include clear directions on which carrier, account, and service to use for your shipments.
- Ensure vendor compliance by providing your routing instructions to your vendors and regularly reviewing your invoices for accurate pricing.
While taking an in-depth look at how to minimize operating expenses can be time-consuming, these small package hacks give you a few quick ways to ship smarter. For more ways to save, PartnerShip can help.
It’s even more important to cut costs where you can, as FedEx and UPS rates are on the rise. Our free guide will help you easily identify the highest rate increases so you can more easily manage your budget.