Do They Deliver? Chained to your overnight delivery service? Maybe you should play the field.
By Mie- Yun Lee
Opinions expressed by Entrepreneur contributors are their own.
When it comes to overnight deliveries, big companies tend to putaside thriftiness and restraint. Spending $15 to send anot-so-urgent document is simply considered a cost of doingbusiness. Small firms, however, can't blindly use this luxury,especially since overnight prices have gone up over the past fewyears. In fact, UPS and FedEx instituted another set of priceincreases in February (with Airborne Express following suit a monthlater), boosting prices an average of 3 percent to 4 percent.
The good news is, you can do more than just fork over anotherchunk of your hard-earned money. There are several simple,practical steps you can take to hold down delivery costs:
- Don't settle on next-morning delivery by default. Inthis industry, time is truly money, so take the time to ask whenthe package needs to arrive. Often, you'll find the recipientis satisfied to receive a package in two days, as long as itarrives at the agreed-upon time.
This simple question can slash 20 percent to 50 percent off yourdelivery costs. Because delivery service charges aretime-dependent, a package arriving at 10:30 the next morning can beup to 20 percent more costly than a package arriving 51¦2hours later. Moreover, sending a package by two-day service will be30 percent to 50 percent cheaper than next-morning delivery.
- Stay in the zone. You can also save if you choose acarrier based on how far the package is going. UPS and FedEx bothcharge based on the distance of the delivery. Even with their pricehikes, this zone-based pricing usually makes shipping to localregions via FedEx or UPS more cost-effective than options offeredby their competitors.
On the other hand, zone-based pricing falters when it comes toshipping packages long distances. We found Airborne Express'flat rates to be more competitive for shipments to locations morethan 600 miles away. By taking advantage of these differences, youcan save approximately 30 percent off the delivery cost of anygiven package.
- Weigh your options. Carriers often specialize inhandling packages of a certain weight. While all the services willdeliver almost any size package anywhere, rates vary based on thepackage's weight.
Dramatic savings can be found when sending heavy shipments inparticular. One company needed to make an emergency overnightshipment of books to a customer in St. Louis. By using BAX Globalinstead of its standard overnight shipper, the company saved nearly$800. Emery also offers attractive rates for shipping freightovernight.
For shipments weighing less than 5 pounds, Airborne is hard tobeat. Similarly, for two-day air delivery, RPS Inc. is alwayscompetitively priced.
Looking to send a package abroad? DHL Worldwide Express isalways a good bet for its extensive delivery network.
- Avoid weekend and holiday deliveries. You'llroutinely be hit with additional charges of $10 to $25 to deliverthat package on Saturday. The way to avoid these surcharges and getyour packages delivered any day of the year is to turn to the U.S.Postal Service. Neither rain, nor sleet, nor Sundays and federalholidays seem to stop it from delivering.
- Mix and match. An established shipping strategy can helpbring all the pieces together. If your company sends a wide varietyof packages, the best solution is the mixed strategy. Establishaccounts with multiple carriers--it's free, and it gives youthe flexibility to use different carriers based on whichever oneoffers the service you need at the lowest price.
If you'd rather not deal with multiple carriers, choose theone that most cost-effectively handles the type of shipping,whether by weight or destination, you do most. By consolidating allyour shipping with a single carrier, you'll reduce the numberof bills you receive and begin to build enough volume to qualifyfor a discount.
- Master the art of negotiation. No matter why you use aparticular carrier, it makes sense to negotiate a discount.Determine how much you spend on shipping in one year, payingparticular attention to the average weight and distance packagestravel, as well as the volume. And be generous in your projections;even if you don't meet them, the carrier will adjust your rateaccordingly, without penalty.
- Check out "under the radar discounts." Even ifyou don't qualify for discounts on your account, there are anumber of ways you can pay less for your packages. See whether yourlocal small-business or trade association offers shippingdiscounts. For example, American Express corporate cardholders cansave 10 percent off standard FedEx rates for domestic shipments byusing their cards to charge shipments.
Willing to pay in advance for shipping your packages? If so,you'll want to try using the prepaid packages offered byAirborne Express and overnight resellers like UniShippersAssociation, an association of companies that combines shippingvolumes to qualify for discounted rates. Prepaid packages areconvenient, and the rates save you money. Moreover, you can ship asmuch as you can fit in the packaging without being charged extrafor heavier shipments. The catch, though, is that the smallestquantity you can buy the packaging in is in sets of 10.
- Check your bill. I've saved hundreds of dollars bycatching package weights that were entered incorrectly or packagesthat didn't make their guaranteed delivery times.
Contact Sources
Airborne Express, http://www.airborne.com
BAX Global, http://www.baxglobal.com
Emery Worldwide, http://www.emeryworld.com
Federal Express Corp., http://www.fedex.com
UPS, http://www.ups.com
Mie-Yun Lee is editor of the bimonthly Business ConsumerGuide and BuyersZone (http://www.buyerszone.com), an Internet buying service. She is alsoco-author of The Essential Business Buyer's Guide(Sourcebooks Inc.).
