Ouch! Shipping is how much? We hear it all the time, and say it ourselves just as much. Shipping cost just keep rising, while FedEx and UPS both are showing profits that will make your jaw hit the floor in total disbelief! Regardless of the pinch they put consumers in, there are no signs of the increases letting up. So what is the solution? How can we make the most of our shipping dollars?
As consumers we have to get more creative in finding ways to save on shipping costs. We look for free shipping every chance we can get and then flat rate shipping as generally the next best thing, but sometimes we just have to pay whatever it is that the carriers want to charge us. It is those times that we really need to have a plan in place to capitalize on the “shipping sweet spot.”
What does a sweet anything have to do with shipping costs? Well it’s like this. The sweet spot with shipping charges is that narrow window between the price jumps. When you capitalizing on that window, you can save tons over the course of a year on your shipping costs! Regardless of whether you are shipping small package or LTL freight (Less than a Truck Load), you can apply this same logic. To demonstrate let’s look at a tanning salon that is getting ready to re-lamp their beds. They have 10 beds and each bed has 48 lamps. Since they aren’t sure how many they can do a week, they order 96 lamps, so that they can do two this weekend. Lamps ship out and the salon pays $121 in LTL freight charges, next week the same thing and this repeats for a total five weeks. They just spent $605 in shipping charges to get their lamps in to re-lamp their beds, doing it two beds at a time. If they had shipped all the lamps at once the total charge would have been $390 or a $215 savings on their freight costs. Why the big difference?
Many times folks don’t realized that there is a minimum shipping charge and that minimum covers up to a certain weight and/or distance. All too often people neglect to take advantage of that and lose money in shipping costs. As a rule of thumb and depending on distance you can roughly ship 100 - 150 pounds under the minimum charge rate or really close to it. If you needed to change out an acrylic that weighs 45 pounds, but goes LTL, then go ahead and put some lamps on that same order and get it all for basically the same shipping charge. It’s like getting free shipping on the lamps!
When it comes to small packages, a lot has changed over the last couple of years, with FedEx and UPS both changing the way they bill for shipping charges. Now it’s all about the dims! Dimensional weight that is. Dimensional weight is determined by an equation based on the dimensions of the box. Basically it is length x width x height divided by 166. In a nut shell…if that box dims out at 14 pounds and the item weight inside that box is only six pounds you just paid for eight extra pounds of weight…for nothing! On the other hand if that shipment was 20 pounds then you will pay 20 pounds worth of shipping charges, so you
see, the only way to beat them at their game is to maximize wherever you can. It is true that finding that sweet spot with small packages, can be a bit more of a challenge for the consumers, but there are still lots of ways to save and the key to saving with small package shipments is planning! Remember even a small box if not filled up could be wasting your money! Let’s say that Jane likes to purchase lotions as they are sold in her salon. Today she sold two bottles so first thing in the morning she placed an order to replace those two bottles. Order one. Then that afternoon Jane sells three bottles and reorders them. That’s order two and each day Jane basically follows the same pattern day after day, week after week. In the course of that one week Jane might have four or five small orders. Each one of those orders costing roughly $12 in shipping. By the end of the week she has spent about $60 in shipping. If Jane, instead started using projections and planned to make one order each week, then the potential for savings could be huge. If each of those four or five small orders would have fit in one larger box for one charge of roughly $22. Jane would have just saved nearly $40 in shipping for that one week! Over the course of a year that could really add up to significate savings. With just a little bit of thought and effort, simple planning can make all the difference in watching shipping cost go down and your bottom line grow. Like I said in the beginning, it’s all about the “sweet spot.” Find your shipping sweet spot and watch your shipping cost go down!
