In today's interconnected business landscape, small businesses heavily rely on efficient and reliable shipping services to maintain their supply chains and meet customer demands. With the potential UPS strike looming, it is crucial for small businesses to understand the implications and take proactive measures to safeguard their operations. In this article, we’ll delve into the details of the potential UPS strike, why small businesses should care, and provide actionable steps to protect their supply chains during this uncertain period.

Understanding the UPS Strike

Negotiations between UPS and the Teamsters, the union representing UPS employees, are ongoing and have reached a critical point. While it is uncertain whether a strike will occur, it is essential for small businesses to be prepared for such a scenario. The Teamsters and UPS have until August 1 to reach an agreement. The impact of a UPS strike can be significant, disrupting supply chains and causing delays in deliveries, which can have far-reaching consequences for businesses of all sizes.

Implications for Small Businesses:

• Disrupted Operations: Small businesses heavily reliant on UPS services may face disruptions in their day-to-day operations, such as delays in receiving inventory, shipping products to customers, and meeting delivery deadlines. This can lead to dissatisfied customers, decreased revenue, and potential damage to the brand reputation.


• Increased Costs: In the event of a UPS strike, small businesses might be forced to seek alternative shipping solutions, which could come at a higher price. Exploring other shipping carrier options and securing competitive pricing now will be a necessary lifeline.


• Supply Chain Bottlenecks: A UPS strike can cause a ripple effect throughout the entire supply chain. Suppliers, manufacturers, and distributors relying on UPS may experience delays in receiving raw materials or components, leading to production slowdowns and potential stock shortages. Small businesses need to proactively address these bottlenecks to mitigate the impact on their operations.

Protecting Your Supply Chain:

• Diversify Shipping Partners: Small businesses should consider partnering with alternative shipping providers such as FedEx, DHL, or regional carriers. Research and negotiate discounted rates with these providers well in advance, ensuring they can handle the business's shipping volume during a UPS strike.


• Plan Ahead: Developing contingency plans and forecasting potential disruptions is crucial. Small businesses should communicate with suppliers, manufacturers, and customers, informing them of potential delays and seeking alternative arrangements if necessary. Implementing buffer inventory or safety stock can help mitigate supply chain disruptions during this period.


• Explore Local Sourcing: In case of a UPS strike, small businesses can explore local sourcing options for raw materials or components. This reduces the reliance on long-distance shipping and minimizes the impact of any potential disruptions in the transportation network.


• Optimize Inventory Management: Efficient inventory management becomes paramount during uncertain times. Small businesses should analyze their inventory levels, streamline their procurement processes, and leverage technology solutions to track and manage inventory in real-time. This ensures the availability of essential products and reduces the risk of stockouts during a UPS strike.


• Communicate with Customers: Proactive and transparent communication with customers is crucial during periods of disruption. Small businesses should keep customers informed about potential delays, set realistic expectations, and provide updates throughout the process. Customer loyalty can be maintained by offering alternative shipping options or discounts during this challenging period.


• Control Your Costs: One effective way for small businesses to safeguard their supply chains and keep costs under control during a potential UPS strike is by exploring discounted shipping options. PartnerShip works with over 130 associations to provide members with substantial discounts on FedEx services through the FedEx Advantage program. By signing up for the program, businesses can mitigate the financial impact of a UPS strike while maintaining reliable shipping services. These discounts can help offset any potential increase in shipping costs and ensure that businesses can continue to fulfill orders and meet customer expectations without compromising their bottom line. Contact our team to find out if you qualify for the FedEx discounts and how to get started.

From Disruption to Resilience

While the potential UPS strike poses challenges for small businesses, it also presents an opportunity to reassess and strengthen their supply chain strategies. By diversifying shipping partners, planning ahead, exploring local sourcing options, optimizing inventory management, and maintaining open communication with customers, small businesses can navigate through potential disruptions and emerge stronger. Being prepared for contingencies ensures business continuity and safeguards the customer experience, even during challenging times.

If you're a small-business owner, you know that shipping your products can be a time-consuming and frustrating task. When you have limited resources and staff, every wasted second counts. But it's time to take action - there are ways to make small package shipping easier, and faster, for you and your business. 

As a consumer, the words “free shipping” can create a huge incentive that pushes you to purchase. The expectation for most shoppers is that there will be some sort of free option. However, many retailers are still hesitant to offer free shipping, or stuck on how to make the choice available to consumers while still protecting their bottom line. Let’s take a look at the three most common misconceptions about offering free shipping, and how you can implement strategies to make it work to your business’s advantage.

Misconception #1 – Absorbing shipping costs will cut into my bottom line

If we’re really being honest here, it’s important to note that free shipping isn’t really “free”. Transportation services require time and effort from the carrier, so someone has to pay for it. If it’s not your customer, then it will have to be you. If not addressed correctly, you will have to absorb costs, and this will decrease your margins, overall.

The good news is that offering free shipping to your customer can have a major positive impact on your sales because it’s viewed as a huge value-add. In fact, most consumers are willing to spend up to 30% more online if they know they won’t be paying for shipping. As a top incentive, a further 93% of shoppers say they will take action to qualify for free shipping by adding more items to their order. By offering free shipping, you are going to boost sales and increase your average order spend. In time, the increase in revenue will ideally offset your shipping costs.

Pro tip: Set a minimum amount threshold to qualify for free shipping. 

To make free shipping a viable strategy, it’s probably not smart to offer the service on just any order that is placed. Because shipping costs fluctuate, it can be hard to predict consistently. By setting a minimum order amount, you’ll help ensure that the revenue from the sale will offset the costs of transportation. Determine your minimum order value in advance, and be strategic about communicating that minimum amount during every step of checkout.

Misconception #2 – Building shipping cost into product price will scare customers

To counter the cost of shipping, it may make sense to increase your product price. But this can sound like a scary notion. Raised prices turn off customers and decreases your competitive advantage, right? The truth is, by increasing prices even minimally, while offering a high-value service like free shipping, you will see a boost to your net margin. 49% of all cart abandonment occurs due to sticker shock at the shipping point of checkout, not due to product price. Moderate price increases are generally justified by the customer, as long as fulfillment expectations are being met.

Pro tip: Product pricing should match what your customers are willing to spend and the type of customer you are trying to attract.

When building shipping costs into the price of your products, it’s always important to keep in mind who your target consumer base is. For example, a premium, brand-name shoe retailer can get away with a higher minimum price point than a book seller. Adding the cost of shipping into product price is a legitimate tactic that ensures you're covering your bases, just keep your price points fair and realistic.

Misconception #3 – The demand for free shipping isn’t there for my business 

Unless you’ve been living under a rock, you know that free shipping has pretty much become the industry standard. Thanks to large ecommerce companies like Amazon, consumers expect shipping to be fast, free, or a combination of both. No matter whether you’re selling t-shirts or toolkits, the demand for free shipping is there for any industry. In fact, 66% of consumers want free shipping on all orders, regardless of the total, and 88% expect it when their order exceeds a certain amount. Even more alarming, 61% of shoppers say they are “somewhat likely” to cancel their order if free shipping isn’t offered – that’s a big old ‘yikes’. In short, when the majority of your consumer base expects some type of free shipping, it’s time to stop stalling and decide how to offer the service instead.

Pro tip: Explore ways to “test out” free shipping with offers and promotions.

You don’t have to jump right into a committed strategy right off the rip – dipping your toes in can help determine which tactics work best for you. Consider offering new customers, or rewarding existing ones, with a free shipping promotion. Implement VIP or loyalty programs that allow your customers to sign up and receive free shipping as an incentive. You may even benefit from offering free shipping on select items (perhaps those with a higher price point). By testing out different methods, you can really look at the shipping costs you incur, what your minimum order threshold should be, and refine your strategy from there.

Discounted shipping options help you and your customers

No matter which tactic you decide is best when offering free shipping to your customers, it’s extra important to keep your shipping costs low. You might not know that there are often shipping discounts available through memberships within trade associations, chambers, and industry groups. PartnerShip works with over 130 groups to provide their members with discounts on FedEx services. Contact our team to find out if you qualify.

Choosing the right shipping strategy can help increase profitability, conversion, and repeat business from your customers. But, how do you know which one is right for you? We take a look at the three most common small package shipping strategies for retailers, so you can decide what makes sense for your business.

When you don't have a loading dock for your freight, your options can seem pretty limited when it comes to delivery. Luckily, many LTL freight carriers offer inside delivery - a convenient service that comes at an extra cost. Learn all about inside delivery in our newest video.

Shipping during the holidays can be a quite a challenge. Getting packages delivered on time is tough enough, but peak season returns can be an even greater headache. Return shipping is just a part of the retail experience, but with proper planning it is possible to control. Review these seven strategies before you create that plan to help to ensure a more seamless process for your peak season returns.

Strategy #1: Commit to full transparency regarding your return policy

When you think about your own shopping preferences, it becomes clear that reviewing a return policy before purchase is standard procedure. This is especially important if your peak season return policy is different than the rest of the year. Shoppers want to know what they’re getting into before they click “place my order.” When a retailer makes return information easily accessible, the buyer is more likely to make a purchase because there is less risk. 

Proactively communicate the policy in places like order confirmations and follow-up emails. It’s also key to stay in contact during all stages of the buying process. Send order tracking links in emails, send delivery notifications, and create a clear FAQ section on your website that includes contact options. The more information you have readily available for customers, the more confident your buyers will be.

Strategy #2: Optimize your packaging procedures

Shipment volume is alarmingly high, and will be compounded during the holidays. During peak times, your packages will spend more time in transit and encounter more stops along the way. That means more handling at service terminals, which can result in added damages. Take a hard look at your return rates related to damaged shipments. If you’re seeing an above-average trend, consider whether your packaging procedures need to be adjusted. It may make sense to use boxes rather than mailers, for example. Minimizing extra space and adding more bubble wrap or packing foam can better protect your products. If you’re sending out large items, consider breaking them down for transit rather than shipping them assembled. Don’t underestimate how much your packaging can affect your return rate due to damages. 

Strategy #3: Limit returns that are caused by late deliveries

There are always last-minute holiday shoppers — you might even know a few. Late deliveries often lead to returns during the peak season, since they didn’t arrive in time for the big date. Ensure that you make it very clear for customers what the cutoff dates are for their order to be shipped in time for Christmas. An easy-to-scan reference table of this information will help your shoppers avoid late arrivals. 

To determine those cutoff dates, be sure to review the deadlines published by your carrier. You may also want to add in some buffer days in case of any unforeseen delays. During the peak season when demand is high, unfortunately there can be a higher risk of your orders not being delivered in time. 

Make sure you’re also offering expedited options at check-out, to provide a solution for shoppers who need a quicker turnaround. For serious stragglers, offer in-store pick-up if you have a brick-and-mortar option. 

Strategy #4: Improve your returns plan by auditing your process yearly

It’s never a good idea to assume this year’s peak season returns strategy should be the same as last year. Every year, your returns plan and options need to be reviewed. Your first step should be to take a look at your returns rate and the reasons for the returns. Find out whether items are being returned due to product performance, or other issues like damages or late delivery. If it turns out that you have a shipping issue, make sure you’re following our tips mentioned above. 

After you take care of any shipping challenges, look at what returns options measure up with what you can feasibly afford. Free shipping of any kind is a perk, but you need to be mindful of your budget and compensate for that expense. Consider a flexible policy, such as free returns on full-price items, or within a certain window of time. Think about charging for delivery, but keeping returns free. When you’re reviewing whether these options will fit your budget, don’t forget to check carrier rate changes and peak surcharges, both of which affect your shipping costs. From there, you can adjust your returns plan as-needed. 

Strategy #5: Consider on-demand warehousing to simplify orders and returns

The overhead costs involved in setting up and maintaining a warehouse are expensive. Due to the cyclical nature of the industry, many retailers don’t find it worth it to use in-house solutions. On-demand warehousing is a great opportunity for businesses that need short-term fulfillment options but don’t want to be under contract. This strategy helps increase flexibility by housing inventory only when needed. If you have seasonal inventory overflow, on-demand options can help eliminate long-term commitments. For businesses that do not need a warehouse year-round, on-demand warehousing is the way to go. 

Strategy #6 Give your customers a variety of return options

Consumers want return options that fit into their busy lives. Don’t complicate the relationship you have with your customers by making an already disappointing situation even worse. Offer methods that fit preferences and convenience, such as a choice to return product online and in-store. In-store returns give retailers more facetime with the customer and offer a better chance of turning the transaction into an exchange. However, many shoppers want the convenience and time-saving choice of shipping back their order. Consider using carriers like FedEx that allow drop offs at a variety of locations, including FedEx Ship Centers, drop-off boxes, Office Depot, Walgreens, and more.

Strategy #7 Make shipping peak season returns as easy as possible for your customer

While you probably want to avoid returns as often as possible, don’t try to dodge them completely by making the process super complicated. Smart retailers know that they cannot always be avoided — the ultimate goal is to use returns as an opportunity to increase brand satisfaction. Remind your customer of your returns and replacement policy throughout the buying process. Include return information on your order confirmation page and within follow up emails. Choose secure packaging that can be reused if needed, and include labels and instructions for returns with the product you’re shipping out. Think long-term — customers that have a bad experience with a retailer this year, will actively avoid them in the future. Making returns easy creates a positive buying experience, and increases confidence for both you and the customer.

Putting the strategies into action

Retail and peak season returns go hand-in-hand. They aren’t ideal, but if you know how to prepare, manage, and use them to your advantage, your business can thrive during the holidays. PartnerShip has strong relationships with a variety of retail groups, and we are uniquely positioned to help strategize your returns process in a way that works best for your business. From on-demand warehouse solutions to saving money on the costs of returns, we can help make your holiday season a success.

Parcel shipping during the holidays is tough. From inventory mismanagement to carrier delays, there are plenty of obstacles that can get in the way of a seamless holiday shipping experience. In our newest video, we take a look at the four mistakes that can absolutely sabotage your peak season shipping.

Small businesses have it tough, and the fact that volume shipping discounts aren’t always an option makes shipping expensive. The good news is that small retailers have options to decrease shipping expenses without having to rely on volume discounts. Check out our helpful video to learn how. 

As a consumer, it might feel like it’s too soon to start thinking about the holidays, but retailers know that waiting is not an option. If you’re an ecommerce seller, you’ve probably already been stocking up your inventory and preparing for the increase in traffic to your site. As you’re getting ready for this busy time of year, keep these crucial holiday shipping strategies in mind.

1. Reduce your parcel rates
   Shipping orders to your customers can get expensive, fast. While some of the big players in ecommerce can negotiate discounted rates directly with FedEx and UPS, that doesn’t mean that the smaller sellers have to suffer. If you belong to a trade association or a chamber of commerce, check out their member benefits. Many groups offer parcel discounts with UPS or FedEx that are included as part of your membership.


2. Consider on-demand warehousing options
   If you don’t need year-round warehouse space, but your orders ramp up significantly during the holiday season, consider using on-demand warehousing. This can help alleviate the pressure on your existing operations, in a time when it’s crucial that everything runs smoothly. A key part of this strategy is also the added ability to reach your customers sooner. It’s no secret that meeting customer expectations for deliveries is essential to your business, and with the right warehousing partner, you’ll be able to reduce transit times and gain access to cost-effective expedited services.


3. Clearly communicate shipping deadlines
   There are some of us who are guilty of waiting until the last minute to do their holiday shopping. When’s the last day to order for Christmas? Do you offer expedited options or any special seasonal guarantees that could give you a leg up over the competition? Managing customer expectations for holiday shipping will increase your customer satisfaction. Clearly communicate this information on your website, during the purchasing process, and in emails to your subscribers.


4. Consider special promotions
   Now is the time to pull out all the stops to maximize your sales. People are looking to buy, and it’s your job to incentivize them to spend their hard earned dollars on your site. According to a report by the National Retail Federation, 50% of shoppers cited a limited-time sale or promotion as the reason they were swayed to purchase an item they were on the fence about.
   
   Even more notable, 64% of shoppers said that free shipping has influenced them to make a purchase. Offering free shipping has become the new normal in the world of ecommerce. If you’re worried about the costs of “free shipping” there are several different strategies you could try. For example, try setting the free shipping threshold above your average order amount to increase the amount people spend when making a purchase on your site. When executed properly, consumers will be more likely to add items to their cart to meet the minimum and it becomes a win-win.


5. Set up a streamlined returns process
   With increased holiday sales comes the inevitable – returns. According to a Narvar Consumer Report, 74% of customers said return shipping fees will prevent them from making a purchase. On the flip side, 72% said that a “no questions asked” return policy would make them more likely to buy from a retailer. The influence of the return policy on the purchase decision is undeniable. Make your return policy as customer friendly as possible and communicate it clearly at the beginning of the shopping experience. Also, take proactive steps like providing return labels in the original order and offering in-store returns so it is less of a headache for you and your customers.

Striking a balance between appealing customer promotions and the right holiday shipping strategies can help make your season bright. If you need to reduce your parcel costs or could use some help with storage and fulfillment, PartnerShip has you covered. Our shipping and warehousing services set ecommerce sellers up for success. Contact us today to learn how you can ship smarter.

UPS and FedEx have both announced that they will not apply peak season surcharges on residential deliveries this holiday shipping season. However, both companies will continue peak surcharges on large shipments and those requiring additional handling during the holidays.

During the 2018 holiday season, UPS applied a per package residential peak delivery surcharge of $0.28 for ground and $0.99 for air shipments. This year, the company is leveraging its expanded air and ground capacity, and automated sorting hubs and processing facilities, to pass cost savings on to customers in the form of no residential delivery peak surcharge. More than 75% of UPS's small package volume will pass through these automated facilities in peak 2019.

“We delivered a record-setting 2018 peak season in terms of both on-time delivery performance and operations execution,” said David Abney, UPS Chairman and CEO. “We will build on the lessons learned last year and leverage our new efficient air and ground capacity to make the 2019 peak season another success for customers, investors and other stakeholders.”

This is the third holiday season FedEx has not added additional peak surcharges on residential deliveries. With UPS and FedEx both not applying a residential delivery surcharge this year, it is great news for e-commerce retailers and online shoppers. Online sales are expected to grow 14% to 18% this holiday season, and in the past, these residential delivery surcharges were passed along to shoppers in the form of higher shipping costs.

It’s important to remember that both UPS and FedEx are implementing peak surcharges this holiday season on larger packages and those that require additional handling.

UPS peak surcharges will apply to larger packages from October 1 through January 4:

• $31.45 per package for shipments that qualify as large (a 20% increase from 2018)
• $250.00 per package for shipments that qualify as over maximum limits (a 51.5% increase)

FedEx and UPS rates will be going up after the holiday season! Make sure you know what to expect so you can mitigate the impact to your bottom line. Our free white paper breaks down where you'll find the highest increases and explains some of the complicated changes you need to be aware of.