6 ways to help reduce shipping costs for your business

APRIL 14, 2016 If you use the United States Postal Service for business mailing, your costs just got slightly less expensive. For the first time in nearly 100 years, the postal service has dropped the price of postage. The price reduction mandated by the Postal Regulatory Commission (PRC) amounts to pennies less per transaction and will help reduce shipping costs for many businesses, but according to the USPS, the reduction will cost the government agency $2 billion in annual revenue. Pennies add up, says Marcy Hogan, a manager with SendOutCards. “I was elated to discover that the USPS lowered the cost of stamps,” she says. “My business is a technology-based greeting card and gifting system where recipients receive real cards and gifts in the mail via USPS. Along with plans and packages for sending cards and gifts, my clients purchase postage through the system. Many of them use SendOutCards as a follow-up and marketing tool for their businesses. With the lower cost of stamps, they’ll save money on postage, which is part of their marketing dollars.” It pays to closely consider shipping charges, agrees Luz Sellers, co-owner of Sellers Gifts, a gift and concierge service. “Shipping fees cut into profit quickly,” Sellers says, “which is why I’m mindful of the various mailing options and even of the use of shipping supplies, such as tape.” It’s possible to keep shipping charges from taking a big bite out of your bottom line. Reduce shipping costs by keeping the following tips in mind.

Compare Packaging

It’s often best to use packaging provided by the postal carrier. Using your own packaging can cost you more if your box is considered an off size, exceeds certain dimensions or is especially heavy. On the other hand, the USPS’s flat rate boxes allow you to pay the same amount of money no matter how much the packages weigh. In general, it’s best to choose the smallest box or envelope possible—the smaller the package, the less it usually costs to ship.

Save on Packing Materials

Packing materials can add substantially to the cost of shipping. Recycle whenever possible, which will save money and is an environmentally friendly option. Also buy packaging materials in bulk. When weight isn’t an issue, opt for less expensive newspaper over more costly packaging materials like Styrofoam peanuts.

Negotiate

Small businesses can have a surprising amount of clout when it comes to negotiating for lower shipping fees. Compare prices and look for shipping reduction incentives, advises Ronna Coe, owner of Coastal Component Industries (CCI). “We changed our credit card processing to Authorize.Net through Merchant Services. They are a partner with the Small Business Growth Alliance (SBGA) that offers shipping discounts with FedEx. After I signed up for and received a large discount from FedEx, I called my UPS manager to see if they would match my FedEx pricing, and they did.”

Look into Regional Carriers

If you ship within a certain geographic area, it may be more expedient and cost effective to use a regional carrier. Such carriers tend to have lower prices than national companies. Before signing up with a regional carrier, check out their delivery areas carefully to make certain they can help you service your clients.

Try Prepaid Shipping

Some postal carriers offer a discounted rate if you buy certain quantities of shipping labels prior to using them. You simply use the labels when shipping is necessary, rather than paying for each package. If you are going to try this, it’s best to know the box or envelope size that you’ll be using most often.

Inquire about Association Discounts

Belonging to certain organizations can mean a member discount when it comes to shipping. If you are a member of a sizeable association, ask if there are any discounted rates with carriers such as FedEx and UPS. Read more articles on saving money.

Photo: iStock