Luke Kupersmith, CEO of Source Consulting on How to Lower Your Company's Shipping Costs
Written by Luke Kupersmith Tuesday, May 29 2012
Need to Cut Costs?
Although the economy is slowly recovering, many companies, most especially small businesses and startups, are still trying to figure out ways to save money for the long-term or to reduce some unnecessary expenses to allow for more leverage within their business. Some of the easiest ways to save are actually through your company’s shipping costs. When I started my first company, Blankstyle, a clothing line of blank tees and screen-printing services, I came across the need for shipping cost reduction.
Shipping costs may seem set in stone, but in actuality, there are actually many different methods and audits you can conduct to create a guaranteed method for saving money on your company’s shipping. The two most effective ways I recommend to reduce your shipping costs are simply by conducting a parcel audit and through a carrier negotiation.
1. Check the Numbers
A parcel audit is one of the ways to reduce your company’s overall shipping bill. A “parcel audit” is the act of looking through your carrier invoices for carrier errors. Finding a carrier error often results in obtaining refunds from the carrier. The concept may sound a bit strange to some— do carriers really make mistakes?— but in actuality, due to the millions of packages that are shipped each and every day by individuals and businesses, even with great technological advances, much of the shipping process is still handled by actual human interaction. This type of handling means that the shipments are prone for mistakes simply due to the high volume of package traffic.
For example, a carrier may assess invalid residential charges when a carrier driver mistakenly choses the incorrect destination input— whether he delivers a package to a residential or commercial address— or simply a computing error from the drivers’ device. If you take notice of these errors on your invoice, a refund will come your way.
2. Make the Call
Another way to reduce your shipping bill is to negotiate discounts during a carrier negotiation. When you or someone from your company meets with a carrier representative, the end result is to make sure that discounts are included in your new or updated contract. Although the process may seem simple, much like any other company, the carriers are a profit-driven company and do typically offer discounts up-front, especially to long-term customers, in order to maintain a customer's business. Make sure to conduct the appropriate research on competitive pricing and shipping amounts, as well as learn the appropriate ways to approach a carrier representative by knowing their motivations and the correct lingo.
As you can see, these are straightforward ways to help reduce the your shipping costs. Through an analysis of your current shipping, whether in looking back at your carrier invoices or slowly combing through your carrier contract, these methods can help to save your company money. More importantly, you should realize that you don’t need to go in alone as there is help available online through third-party sources to help explain and guide your company on sure-fire ways to reduce your shipping.
The best and first course of action should be to review and see where the easiest areas are to help your company save money—it IS possible.
Bio: As CEO and co-founder of Source Consulting, Luke Kupersmith has exemplified strong leadership skills for the past eight years to facilitate a successful business. Source Consulting, a privately owned logistics consulting and solution provider, has become one of the leading transportation and logistics consulting companies in the country. Kupersmith has led the formation and development of two now-successful companies. Previous to his entrepreneurial ventures he gained experience working as a financial advisor for small businesses and wealthy individuals.