May 28, 2012

May 29, 2012

PartnerShip will also be closed May 28, 2012 and will reopen at our normal business hours on May 29, 2012. For questions about these closures and how they may affect shipments, please feel free to contact PartnerShip at 800-599-2902 or email sales@PartnerShip.com.

From everyone here at PartnerShip — have a safe and happy Memorial Day weekend!

Like many small businesses, you may not currently have control over the shipments coming into your business. It is common for small businesses to let the vendor shipping the product to you arrange the carrier, select the mode of transportation, and manage the actual pickup and delivery times. In some cases, the convenience of this sort of arrangement may work well for your situation. However, that convenience comes with a cost: you may find that you are paying significantly more for inbound shipping than if you had arranged for it on your own.

Reducing inbound shipping costs is one of the easiest, yet most overlooked ways to reduce your overall transportation expenses. Since you are the buyer of the goods, you can and should determine how those goods are shipped to you. When you control and route your own inbound shipments, you have an excellent opportunity to lower your costs.

Here is a quick, three-step process for getting control of your inbound shipping expenses:

1. Look at one or two invoices from your major suppliers. See what dollar amount they allocate for “shipping and handling.”

2. Compare your suppliers’ freight shipping rates with the rates you have in place with your preferred shipping provider. If you’re a PartnerShip customer, you can easily log into our website and perform a couple rate quotes to see how your freight rates compare (or just give us a call – we’ll do it for you).

3. If you find your rates are lower, draw up a letter for your purchasing department to forward to your suppliers providing details on how you want your products shipped, your small package carrier account number, and your preferred LTL freight carriers (again, PartnerShip can do all of this for you if you’d prefer). The letter also acts as an insurance policy if your supplier mistakenly ships by a carrier not on your routing letter. Having a signed letter allows you to charge vendors back for their mistakes.

Updating your routing instructions with all of your suppliers is the first important step in gaining control of your inbound shipping costs. Ensure your products are delivered to you via your preferred carriers and at your known rates. This takes the unpredictability out of inbound shipping costs, and can save you money in the process.

PartnerShip has a new alliance with ABF, making them the newest carrier partner available through our LTL Freight shipping programs (LTL stands for less-than-truckload). ABF joins our short list of reputable national and regional carriers, which also includes UPS Freight, YRC Freight, Con-way Freight, Old Dominion, FedEx Freight, New Penn, and Pitt Ohio. When PartnerShip customers use the Quote/Create Shipment tool on PartnerShip.com, they will now often see ABF shown as a service option depending upon the specific lane. ABF has been delivering LTL shipments since 1923, and they are one of the largest, most recognized LTL carriers in the industry today, providing both national and regional service. For more information about ABF, how to get no-obligation LTL freight quotes, or to request a free LTL freight shipment analysis, click the button below.

PartnerShip also has an alliance with ABF to provide moving services for many of our retail customers. ABF does this through their U-Pack Moving service. If you are a PartnerShip retail customer interested in adding moving services to your shipping program, please give us a call at 800-599-2902.

With ever-soaring fuel costs and the resulting rise in shipping rates, many businesses may find their profit margins shrinking even as production increases. Many small businesses use e-commerce in the start-up stages, but with the recent rise in shipping rates, owners are looking for ways to reduce shipping costs.  

In-House Strategies

• Postage meters are an inexpensive way to save time and money for companies that either ship very small light weight products or for which shipping is a smaller portion of their overall product delivery.  A Postage meter will weigh packages accurately, assess precise postage charges and print the shipping label. By taking the guessing out of shipping estimates, both your company and your customer will be satisfied, and shipping overages will be eliminated.

• Compare services and pricing for each carrier on common shipping requirements. Factor in delivery time as well as shipping costs; customers satisfaction is higher when delivery times are shorter.  Eventually you'll gain a picture of what shipping criteria is best serviced by which service. For example FedEx Express has overnight and 2-day delivery options for small packages, but if your shipment is heavier (more than 10 pounds) and isn't under strict time constraints, it might be more cost-effective to use FedEx Ground service.

Outbound Shipping Solutions for Larger Volumes

• Consolidate your orders into less-than-truckload (LTL) freight shipments (more than 200 pounds) could save you even more on shipping. If your company has multiple products going to the same customer, it might make sense to consolidate them into one shipment and use an LTL freight carrier like UPS Freight or YRC Freight. You'll pay quite a bit less than parcel or express service and your liability coverage will be much better as well should there be any loss or damage in transit. 

• Work with a third party logistics (3PL) company. If you don't have the time or resources to figure out which carriers and services would be best for your shipping volumes, a company like PartnerShip can handle the logistics for you and often negotiate a better overall shipping rate for you.

Inbound Shipping Costs

• Small business owners may lump their inbound freight costs into the cost of goods, but poor inbound freight management can severely impact your gross profit margin.  Be sure every vendor invoice is reviewed for hidden fees. Vendors can inflate "Shipping and Handling" fees to compensate for lower priced items. 

• Send routing instructions to your vendors specifying which carriers you want them to use when shipping you your products. You can also set up a direct billing account for vendors that ship to you via FedEx or LTL freight carriers through your 3PL partner. With a direct relationship, you'll be able to track shipping volume putting you in a place to negotiate a better overall rate. 

Small businesses must continually adjust their practices to survive and grow in today's economic climate. Adapting to rising shipping costs is something your company can't afford not to do.

The National Motor Freight Classification (NMFC) is a standard for thousands of commodities likely to be shipped by carriers who agree to use this system. Factors such as weight, item type, dimensions, density, and valuation, among others, are used to determine the NMFC. The NMFC identifies what you are shipping and its freight class, which ultimately affects your freight shipping rates.

Frequent freight shippers and users of the NMFC will want to take note of some changes to the classification system – which will be effective April 14, 2012:

As always, PartnerShip is here to help you determine your commodity's NMFC. Contact us at 800-599-2902 or email select@PartnerShip.com with any questions. Our freight experts stand ready to help you with your freight shipping or to provide you with LTL freight quotes if needed.