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3 More Ways Business Owners Can Save Money on Shipping



3 (more) ways to lower your FedEx & UPS shipping costs



Many business owners struggle as shipping costs continually trend upward with no end in sight. How can a non-enterprise sized business shipper cut costs while FedEx and UPS keep increasing their rates (now more than once per year!) and Amazon keep strengthening their Prime and free shipping promotions? Unless you ship at Super-Uber-level volumes, it can be more and more difficult to gain leverage and cut a break with your shipping carriers.

There is some good news! A number of opportunities exist for businesses to save on shipping. They all involve a certain level of investment in time and, to a certain degree, knowledge. As a 20-year veteran of the shipping, logistics, and e-commerce industry, having not only walked in the shipper's shoes—managing shipping and logistics for a retail chain—but also the carrier's shoes—running a FedEx group that helped thousands of businesses optimize their shipping operations—here are three suggestions to help you to save money on your shipping so that you can put your money back where you need it— into your business!

1. Ask(!) your carrier rep for better terms.

                

FedEx, UPS, and to a certain degree, USPS, are the only 3 parcel carriers serving the US domestic market. Both FedEx and UPS are in a head-to-head war to get as many customers, and perhaps more importantly, not lose their existing ones. Asking your carrier rep to provide you with better terms becomes a powerful, yet forgetful tactic to pursue. In our experience serving thousands of companies, less than 72% of businesses request it. The mere hint of reaching out to one of their competitors will create a higher sense of urgency and keep them on their toes. Although we have seen a few customers that get updated terms 3-4 times a year, due to the nature of their business and shipping characteristics, we believe an annual ask is sufficient.

2. Leverage volume discounts through groups. 

                                                                       

                    


Often times companies belong to trade association or industry groups. Carriers work with many of these organizations and provide group discounts that may have better terms than your current terms. Make sure the to read the details of the group terms, as some organizations may ask for an enrollment fee or monthly fees. Some of these group discounts are very advantageous, that even after calculating any fees, your total shipping costs are lower than your existing terms. In few occasions, a clause to waive your right to late-delivery refunds may be inserted. Double-check to see if its there, and if possible, ask your association/group to remove it. Or feel free to reach out to us and we can help too!

3. Ask us!


                                                                        

                    

We are fortunate to work with over 5,000 customers, which in aggregate represent hundreds of millions of dollars in shipping spend. We often get approached by various buying groups, organizations, and regional carriers with different group discounts. Let’s talk and we may be able to save you more on your shipping costs! More than half of small businesses do not get any discounts from their shipping provider. As the saying goes, you don’t get what you deserve, you get what you negotiate.

Jose Li is Founder & CEO of 71 Pounds. Jose formerly ran FedEx's retail & e-commerce practice and has worked with thousands of small businesses. Jose has 20 years of experience in shipping, logistics, and e-commerce with Jamba Juice, Alibaba.com, and FedEx. He can be reached at jose@71lbs.com.