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6 Ways to Reduce Your Shipping Costs

Brandi Smith, Marketing Director

As a small to medium sized business (SMB), shipping is one of your largest expenses. Reducing shipping costs may seem like a challenge, but there are more ways than ever to reduce the size of your monthly shipping invoice. At ShipperBee, we know and value the importance of making your business dollar stretch so we’ve put together six ways that your business can reduce shipping costs and improve your profit margins:

1. Look at ways to streamline your packaging

How much you pay to ship a parcel depends on both its weight and size. That's why you should always pack your products in as small a parcel as possible – without jeopardizing the safety of the products being shipped of course. Don’t use a large box if a small box or a bubble mailer can just as easily get your product from A to B in one piece. Packing materials can also add substantially to the cost of shipping. Buy your packaging materials in bulk and when weight isn’t an issue, opt for less expensive newspaper over more costly and less environmentally friendly packaging materials like Styrofoam peanuts. And remember to recycle whenever possible. Reuse that box you received with a shipment to your business last week. Take these steps and in the end not only will you save money, but you’ll be contributing to a healthier environment too.

2. Offer customers your best value

Reality today is that mostcustomers expect free shipping. Oftentimes they go to a competitor that offersthe same product at a comparable price, but offers free shipping. Take into considerationwhether free shipping eats away your profit or actually benefits your business.You can opt to structure your pricing strategy so that it incorporates the costof shipping the product. You can also try offering multiple shippingalternatives to your customers such as one-day delivery, one week or 15 days.Let them choose. Alternatively, you can consider adding a few conditions like aminimum purchase requirement to earn free shipping and offer time-sensitive promotionsto your customers by sending customized shipping offers by email.

3. Consider a Regional Shipping Alternative

When shipping locally or regionally, a regional carrier may be your best option.Regional carriers, like ShipperBee, offer lower rates than national shipping giants because they cover a smaller, more specific geographic area. In our case, we’re a first-of-its-kind end-to-end delivery system that cuts distribution centers out of the equation to help shippers like you save money, end unnecessary local delivery delays, and drastically reduce carbon emissions. Our drivers– commuters, stay-at-home parents, students, retirees, road trippers – deliver parcels using a network of innovative, smart, interconnected transfer mailboxes called Hives. These Hives are located at strategic locations like gas and convenience stores and are Wi-Fi connected, fully weatherproof, camera equipped and are virtually indestructible, keeping parcels safe and secure between drivers and final delivery. Discover why we’re your better regionally based shipper here.

4. Avoid hidden, residential and fuel surcharge fees

Have you ever received your monthly shipping invoice only to see hidden fees like delivery signatures or Saturday deliveries? How about residential and fuel surcharges added into the cost?  Depending on the carrier you use,you may be charged for these features. Select a carrier that has no hidden fees and offers real-time GPS tracking on your package, along with photo confirmation upon delivery at no additional charge. SMBs that take advantage of ShipperBee’s simple, transparent pricing are saving up to $12/package. Imagine the impact of this cost savings on your business’ bottom line too.

5. Use 3rd Party Insurance

Opt out of the large carrier’s shipping insurance options and go with a reliable third party company. The savings can be significant and will add up quickly. On average, carriers charge around $0.90 for every $100 of insurance, while third party companies charge about $0.55 cents for every $100.Why add to the carrier’s bottom line when you can line the pockets of your business?

6. Negotiate

Just because you’re a SMB, doesn’t mean you don’t have negotiating power. You can have a surprising amount of clout when it comes to getting lower shipping fees. Do a good price comparison across all carrier options for regional, national and international shipping if applicable. If you’re a part of a business association, check to see if they have preferred rates with a specific carrier. After you sign up or get a quote, call other carriers and ask for a price match. In a competitive shipping industry, chances are you’ll get a yes because they too want to earn your business.

Saving money on your shipping doesn’t have to be complicated. There are little things you can do that make a big impact. Try all six ways above or select a few to get started. Either way, you’ll be making a difference to your bottom line.

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