Quarterly Live Group Demo Watch Now

Sifted logo

4 Signs Your Shipping Budget Could Be Blown in 2020

by | Feb 6, 2020

4 min read

We’re one month into the new year and already you might be noticing that your carrier’s invoices are, shall we say, a tad higher than you expected.

 

Maybe it’s the new, lower threshold for the additional handling surcharge. Maybe it’s dimensional (DIM) weights. Maybe it’s your free shipping offer. Who can tell?

 

You can, if you take the time to do a little legwork. Don’t get lost in the day-to-day grind of getting shipments out the door and neglect to make a big-picture plan that will keep your budget in check.

 

Sometimes that means a good, hard look in the mirror. It’s quiz time: Do you fit any of these descriptions?

 

You based your budget on the GRI.

Both UPS and FedEx said their General Rate Increase (GRI) would be 4.9% this year, so that’s how a lot of companies set their shipping budgets. But because rate increases affect every company differently, companies that used this rate for budgeting purposes could be in for a costly surprise. Both actual and DIM weights saw price increases this year that exceed the GRI, and home delivery of oversized items skyrocketed 33.3%. If you don’t have a great handle on your shipping profile, it’s time to get started. Especially if…

 

You didn’t analyze last year’s numbers.

Shipping produces a lot of data, especially in your weekly carrier reports — a FedEx CSV file has more than 250 data points to review, and one from UPS has more than 130. It’s easy to let it linger on your to-do list because you’re overwhelmed, but these documents are rich with information that can help you master your budget.

 

First, are you being charged for things you shouldn’t? Then you’re owed a refund. Yay! But wait: Carriers won’t refund you on an invoice you’ve already paid. Darn! Prevent that from happening this year by carefully analyzing each invoice and then requesting a refund if needed before you pay your bill.

 

Second, you can learn a lot about your shipping profile from your numbers. Knowing hard data about what you ship, where you ship it to and from, and the surcharges you most often incur will help you optimize better rates in key areas, like your rate tier, additional handling surcharges, or delivery area surcharges. So you’re likely overspending if…

 

You haven’t optimized your contract for a couple of years.

We’re always surprised to hear from shippers we work with that they haven’t optimized their carrier contract in a few years. If you feel like you’re getting a good deal or you have a great relationship with your carrier rep, you might have let this slide.

 

But your business has surely changed over the last few years, and we know carrier rates and policies have changed. It’s definitely time to dust off your contract and look at what you’re paying for. Is the DIM weight getting you? Or the complex charges around large packages? Get out your data and arm yourself with the information you’ll need for your next optimization.

 

When you prepare to optimize, don’t forget to consider your shipping policies in addition to your data. How does your website frame customers’ expectations? You won’t know if…

 

You aren’t in sync with the marketing team.

With alarming speed, Amazon has trained shoppers to expect fast, free shipping. In fact, in 2019 they even upped the ante and said they’d make one-day shipping the standard for Prime members, putting even more pressure on smaller e-commerce businesses. And guess what? Shoppers expect their returns to be free and easy too.

 

Your marketing team is likely trying to keep up with demand and create the best customer experience possible, making it crucial for you to clearly understand the expectations for shipping they set on sales and checkout pages. What’s the free shipping minimum? What shipping speed options can customers choose from? Do these factors protect your Cost of Goods Sold? Do you have the most economical packaging for frequently paired products on hand?

 

There’s a lot to they need to know from you too, so if you don’t have a great relationship with the marketing group, start working on it. A box of doughnuts never hurt!

 

It’s go time!

If you can relate to any of the above, it’s time to take action. In addition to the tips we’ve mentioned, investigate solutions that can help you dig into your data without it taking hours and ensure you find the best carrier and rates for your unique business.

 

And if you want to know more about ways your shipping could improve, check out our free eBook, Five Shipping Mistakes Your Company Is Likely Making.

Topics: Carrier Invoice Auditing, Carrier Optimization, Contract Optimization, Customer Experience, General Rate Increase
Topics

Check out related resources at Sifted.

Parcel Carrier Diversification 101

Parcel Carrier Diversification 101

Last mile delivery has never been more important to businesses. In 2023, the global last mile delivery market was ...
Read More
RILA LINK 2024 Recap: The Cutting-Edge of Retail Supply Chains

RILA LINK 2024 Recap: The Cutting-Edge of Retail Supply Chains

At the end of February, supply chain leaders from the nation’s largest retailers converged in Dallas for the ...
Read More
Sifted’s Caleb Nelson Named 2024 “Pros to Know” Award Recipient

Sifted’s Caleb Nelson Named 2024 “Pros to Know” Award Recipient

KANSAS CITY, Missouri - Sifted, the trailblazer in Logistics Intelligence™ is proud to announce that Caleb Nelson, ...
Read More
Meet Sifted at LINK 2024

Meet Sifted at LINK 2024

At the end of February, the top supply chain leaders from some of the nation’s largest retailers will converge in ...
Read More
Parcel Carrier Comparison Guide

Parcel Carrier Comparison Guide

In the intricate landscape of parcel shipping today, shippers navigate a complex web of carriers, each with its ...
Read More
Amazon Shipping, Seller Fulfilled Prime, and More: Matt Snyder’s Insights and Advice to Sellers in 2024

Amazon Shipping, Seller Fulfilled Prime, and More: Matt Snyder’s Insights and Advice to Sellers in 2024

Amazon took the supply chain world by storm in 2023. They announced Amazon Shipping, a FedEx and UPS competitor ...
Read More
2024 Shipping Industry Outlook: Top Trends Driving Down Costs + How to Capitalize

2024 Shipping Industry Outlook: Top Trends Driving Down Costs + How to Capitalize

Over the last few years, soaring shipping costs, unpredictable rate hikes, and a challenging logistical landscape ...
Read More
Sifted Celebrates Achievement as 2023 Top Tech Startup by Food Logistics, Supply & Demand Chain Executive

Sifted Celebrates Achievement as 2023 Top Tech Startup by Food Logistics, Supply & Demand Chain Executive

Kansas City, Mo – Sifted, a leader in Logistics Intelligence, has been recognized as a 2023 Top Tech Startup by ...
Read More
11/27/23 Parcel News Update

11/27/23 Parcel News Update

1. Amazon’s Volumes Surpass FedEx and UPS Amazon delivered more parcels in 2022 than UPS, according to internal ...
Read More
11/20/23 Parcel News Update

11/20/23 Parcel News Update

1. USPS Announces Tentative Rate Increases for 2024 The United States Postal Service has announced rate increases ...
Read More
11/13/23 Parcel News Update

11/13/23 Parcel News Update

1. Experts Share Attention-Grabbing Items from 2024 GRIs Supply Chain Dive interviewed industry experts, including ...
Read More
2023 Holiday Shipping Deadlines

2023 Holiday Shipping Deadlines

It’s the most wonderful time of the year? It will be if your customers receive their orders on time. The major ...
Read More

How Sifted Works

Connect to
your account

Sync
your data

Power your
dashboards

Get Your Logistics
Intelligence Demo

Strategic ways to prevent loss down the line

Services you could be utilizing right now for savings

Ways to cut material costs without cutting quality

Are you an FBM (fulfillment by merchant) Amazon seller?

Check out our Marketplace Intelligence solutions to protect your bottom line.

Shipping Insights & Alerts
Get updates and track the things impacting your business most

Decision Support
See how supply chain adjustments pay off before you pay out

Carrier Management
Streamline how you manage your carrier operations and contracts

Business Automation
Let software do what it does better than people can

Seller Insights
Measure and monitor with confidence.

Sales Visualization
Shed new light on your sales data.

Fee Analyzer
Understand the impact of ever-changing FBA fees.

FBA Audit & Recovery
Secure money you’re owed from Amazon.

Blog
Discover news, tips, and industry best practices

DIM Weight Calculator
See how DIM is impacting you

Podcast
Hear from industry experts on LeaderShipping

Case Studies
Learn how other brands use
Logistics Intelligence

Carbon Calculator
Calculate your CO2 Emissions

Thought Leaders
Meet the people behind the technology

Guides
Download free reports and expert how-tos

Demo
Get a personalized tour of our software

About Sifted
Get to know Logistics Intelligence

Logistics Intelligence
For parcel shippers

Marketplace Intelligence
For Amazon FBA sellers

Let's get you to the right place!

SIFTED DASHBOARDS
For parcel shippers

AMAZON Marketplace Intelligence

Not sure if you have an account? Email [email protected].