20 Minutes to Lower Shipping Rates from UPS, FedEx, and DHL

Hi Alec - That is an amazing saving.  Many small businesses would not like to ask their suppliers for discounts - especially if the suppliers are big companies.  But, it just goes to show that if you do ask, you will get.

Wow, that is a real saving!

Catherine, it is absolutely right. We miss so many opportunities simply because we do not try.

Thanks for your insight into shipping.  I don’t have the same kind of the shipping volume as you do, but you bring up some great ideas.  You may also consider talking to the same shipping competitors every 6 months or year as they may give you rates better than what you already have.

Thanks.

Ala

You actually don’t need that much shipping volume to negotiate lower rates. Having a daily pickup account does help alot, though.

The idea is that UPS (Fedex, DHL) wants to be your sole shipping provider.

So, try to find a general shipping destination (zip codes, metropolitan areas, international), or service (2nd Day Air) where the competitor is cheaper. Then go negotiate those particular rates. What may happen is that shipper will lower rates across the board, as in my case.

There may be other ways to get discounts as well, such as setting up an online shipping account (FedEx gives a 5-10% discount), or using Quickbooks (5%), etc.

Right now, I compare rates about once a year. But it sure would not hurt checking more frequently, as you suggest!

We have been using UPS, and shipping out about 4 packages to 5 a day, with up to 10.
I am interested in the using DHL, because they seem to have less damaged shipments to us, then UPS.

Any luck withthem.

Regarding DHL, our businesses has used them periodically, but the quantity of shipments is too low (10-20 year) to be able judge their consistency on shipping reliability and damage contol. All our DHL shipments are to overseas destinations, and we have not heard any complaints to date.

Regarding UPS, with whom ship thousands of fragile packages a year, we get only 2 incidents a year. Last year, UPS provided full refunds (over $500 in total) for two damaged packages. In one case, damage was caused by customs officials, but UPS still refunded us.

Alec, Thanks for your great info as to saving on courier bills.
At first, we opened a non-daily pick up account processing shipment through Internet shipping, the rates were amazingly high, many times higher than what customers paid for using the UPS integrated tool in our ecommerce solution! But after a short period we noticed our rates went down, as if we would have a daily pickup account.
I’m sure that rates can go even lower, based on the volume you ship. Good part is “just give them a call”.

Cheers
Joel

To whomever reads this and chooses to help, I have a short survey.

What is the largest discount that you have received for shipping?

Whom appears to generally be the lower price?

What method/strategy do you use to lower your shipping costs?

Most sincerely & respectfully,
Jason

What has really helped us in addition to negotiating discounts with FedEx, is to go with a shopping cart company for our online business that not only interfaces with FedEx, but specifically with our account to calculate shipping costs based on zip code and weight for our customers.  We now offer our customers FedEx Express, Ground, USPS Priority Mail, USPS First Class, USPS Parcel Post, and USPS Express Mail.  All is calculated for us automatically so there’s no back and forth with the customer.  We also spent a few hours online comparing companies for shipping supplies & found some great deals on Tyvek and Poly shipping bags, and various sized boxes that were about 1/3rd of the cost of what we were paying from OfficeMax, OfficeDepot, etc.  Being able to pass shipping cost savings on to our customers & give them more options for shipping has helped our business.  Using cart32.com for our shopping cart with the automatic FedEx, UPS, USPS, etc. shipping calculations has really simplified things as well.

We ship about 150 FedEx Express packages per month & were able to get discounts from 15-35% depending upon zone and service.  FedEx Ground & Home Delivery discounts were only 5-15%, but now that we’re shipping with them more, I’m going to check with them and UPS to see who will give us the best ground rates.

I negotiated a 42% discount with UPS and Fedex. I told them I was doing 1000 orders a month and that my partner would not allow me to release any previous shipping invoices. So they simply made offers. If I were savvy, I would go back and have them out bid each other until I was content with one.

Rob and Jason:

Wow, 35% to 42%. Good work. How did you guys manage the cross bidding process between FedEx and UPS? I think I’d like to back and renegotiate my rates, too.

Regarding office supplies (boxes), what company or service are you using? I’ve found Uline.com is excellent in terms of overall price and service.

I contacted FedEx & told them we were thinking about switching to DHL because they provided customer billed customs.  The problem we have with international shipments is that if the customer does not pay the customs charges, FedEx sticks us with them.  DHL on the other hand claimed that they hold the receiver soley liable for customs charges.  FedEx then gave us more aggressive discounts even without a specific quote from DHL.

We didn’t end up going with DHL for international - we’re still using USPS.  I would be interested in hearing from anyone who ships international via a carrier other than USPS as to how they deal with customs charges.

We use Uline and PTIpackaging.com - we found PTIpackaging.com to have some really good deals on boxes.  We had ordered poly envelopes from Uline, but apparently PTIpackaging.com has them, they just dont have them on their website. Delivery from both companies has been prompt & prices are good - PTIpackaging.com seemed to be a bit better though.

Interesting experience with FedEx. That’s also one of the reasons I feel uncomfortable using FedEx. Also I found it was much harder to win a claim for damaged goods from FedEx.

I’ve never had trouble filing claims with UPS, even if the goods were damaged by the international customs officers.

I believe UPS won’t deliver the product unless the customer pays the duty and fees upfront. The good news is that we have not yet been stuck with paying customs for the customer. The bad news is that sometimes there are delays, as UPS may not always be able to get in touch with the customer.  FedEx, on the other hand, will make the delivery right away, and worry about the customs later (because the shipper carries the risk).

I believe large volume shippers can get discounts from Uline. The advantage I found with Uline is that they have distribution hubs around the US, making shipping faster and sometimes cheaper.

I think upon creating a shipping label to go overseas, there is an option to select who to contact for duty charges. Perhaps the receiver is responsible by default unless you select otherwise.
For curiosity I have been watching several Canadian shipment and I noticed in the online tracking updates, things like “UPS contacted receiver for customs charges” or similar. That’s why they always ask for a phone number when going internationally.

As to overall shipping discounts, you might get much deeper discount when shipping a lot internationally or overnight than domestic or ground. UPS call it “Incentive discounts” Not sure about the reason.

Think about that: Will prices come down because of an oil decrease? never…

This is really a big savings for anyone who wants to get the most out of every penny earned. Just known now although already quite some time, at least its not yet late to deal with this cash-saving tips: very timely for christmas is just around the corner. Just wondering if these courier giants still practicing this scheme.

Since I last posted, my wife switched from FedEx to UPS.  She gave them our shipping invoices from USPS and FedEx & they came back with rates that save us an extra 5%..  Their customer service has been phenomenal too.. Our UPS Account manager came to her office more than once and they assigned an international shipping specialist for support by phone.

WorldShip integrated well with her back end office systems with their help (not the most intuitive application, but they were very helpful & it’s great).  The drivers are great, dispatch center is great, pickup time is more convenient & international shipments are a breeze with WorldShip.

Their ground rates are great plus their published delivery time for Ground means 1-2 day delivery for CHEAP ground service to neighboring states (Washington, California).

Since my wife cancelled her daily pickup with FedEx, her account manager (which seemed to change every few months) hasn’t even contacted her.  Her discounted volume averages about $6000 a month.. not a huge account, but you think someone at FedEx would at least notice.

Very happy with UPS!

My wife uses http://www.ptipackaging.com/ for all of her packaging (15x12x4 boxes, 15x12x8 boxes & poly bags).. Over 1/3rd less than Uline..  She said that she ends up having to call them though as not everything is listed on their web site.  Some of the stuff she’s ordered from them is less than half the price of Uline.

Thanks for a lot of good pieces of advice. The tips you give are very essential and I hope I will be successful with them like you were. Not long ago I read a very interesting book Small Business Tips (found it at the files search engine http://rapid4me.com ) . It turns out that there are a lot of ways to save on your expenditures.

I’m new online retail store owner.
I have been searching about the domestic and international shipping costs of
USPS and UPS.
I got most of the information in online but it seems like still very
expensive. Whenever I called them, I can’t reach the person who I want to speak with, or they were just not helpful at all(especially at USPS). Maybe
because I don’t speak good English… I’m Japanese.

I am looking at some sites that similar to mine. Most of them offer $8
flat rate for domestic shipping with UPS and $14 flat rate for international
shipping with USPS. I can’t find out how to get these rates.

If anybody have a time to share your solutions, I really really appreciate.

Thank you.

Tomoko:

You may want compare prices using these two webpages:

USPS
http://www.usps.com/tools/calculatepostage/welcome.htm?from=home_header&page=calculatepostage

UPS
https://wwwapps.ups.com/ctc/request?loc=en_US&WT;.svl=PNRO_L1

Choose the same shipping location, destination, and weight to compare the prices.

In general, UPS will almost always cost more than USPS. The advantage of UPS, however, is that their tracking information is far superior. Also, from my experience, UPS has been good about compensating for lost or damaged packages within 30 days, where as USPS takes months or may not happen at all.

For international shipments, UPS (and Fedex) Expedited or Express services will cost about twice as much as USPS. Customs processing is good, delivery timing is guaranteed, and tracking is excellent. However, we have generally found USPS Global Express very reliable. USPS works fairly well for packages valued under $500 (the maximum insurance coverage by USPS).

UPS/Fedex are generally more customer oriented. We rarely call USPS since it’s difficult to accomplish anything that way. They will repeat only what you find on their website anyways. We have found that the local post office is very friendly and helpful at answering in depth questions, however.

"I am looking at some sites that similar to mine. Most of them offer $8
flat rate for domestic shipping with UPS and $14 flat rate for international
shipping with USPS. I can’t find out how to get these rates.”

USPS Airmail small package (might be called something else, they keep changing the name) is the cheapest way to ship, but you can only ship packages under 4 pounds.  Over 4 pounds, you have to go to Priority Mail International which is quite a bit more expensive.

Our UPS discount on international is about 55%, but for most packages, UPS is still more expensive than USPS International Priority Mail, but cheaper than Global Priority & it is very fast (3-5 days to most countries).

We use a shopping cart system that allows us to enter the weight of each item & display shipping options according to weight.

We offer flat rate UPS Ground shipping for $6 on our site..  Doing this, we lose a little bit of money on shipping but I expect we make up for that in increased orders.  We do not offer flat rate International Shipping as we have fairly inexpensive items that can weigh more than 4 pounds.

Hope this helps!

Thank you both so much!.
These informations are very valuable for a lots of new online small business owners like me.
I really appreciate your time and sharing your knowledge.

Have a great holiday!

Rusty—Wow. How did you manage to negotiate the 55% discount on your UPS international shipping? What kind of shipping volume does that require?

In terms of flat rate shipping, we debated that. I think one has to weigh how much shipping cost will influence purchase. If you are in a competitive environment, cheap shipping rates can make a difference. I think I shop Amazon for books because of their darn low (if not free) shipping rates. If you are in a less competitive, or well differentiated product line, then a low flat rate may not be as necessary.

Wow. 55%. That’s awesome.

Hi again,

Do you know about “the rules” for ship clothing internationally.
My web programer mention that international shipping could be messy because of that.

If any of you have or had any problem with it I would like to know before I decide to include international shipping option.

Thank you.

To whomever reads this and chooses to help, I have a short survey.

What is the largest discount that you have received for shipping?

Whom appears to generally be the lower price?

What method do you use to lower your shipping costs?

Most sincerely & respectfully,
Mike

Thanks for the insight delivery. I do not have the same type of shipment volume as you do, but you brought some great ideas. You might also consider talking with a competitor the same delivery every 6 months or years because they can provide better rates than what you already have.

Recently I see many mail forwarding companies like usa2me.com and usamail1.com which are able to offer lower rates using DHL, Fedex. So I wonder how are they able to get these rates which are lower yet generate to them. Anyone knows why? TQ.

I am looking at some sites that similar to mine. Most of them offer $8
flat rate for domestic shipping with UPS and $14 flat rate for international
shipping with USPS. I can’t find out how to get these rates.

I think that deciding on low flat rate vs. real rate depends on how competitive your market is. If it’s very competitive, then a low flat rate may work well, as it may indeed to lead to greater sales volume. If your products and service are highly differentiated, however, then keeping a low flat rate may not necessarily pay out.

Another option is to offer a rate that’s lower than published by UPS or USPS but still on par or higher than your actual negotiated rate. If you can differentiate by, say, offering excellent customer service, many customers may still come your way.

I am listing on eBay for a Pokemon Eon Ticket, which is the size of a regular Pokemon card. What would the shipping cost be for something like this? Hard to judge with the shipping calculator. Online Tax Preparation

How do I get USPS flat rate boxes? I know I can get them at the post office but do I ask for one at the desk? Are the boxes free if I already printed a shipping label?

Order free packaging materials with your UPS Account number. If you use the same supplies over and over, My UPS allows you to easily reorder the supplies you use frequently. Fedelmid

For UPS Ground, you need to use your own supplies.  UPS Ground is fabulous though - depending on where you ship to, it can be as fast as 1-2 days.  We’re on the west coast & most west coast shipments take 1-2 days and it’s CHEAP!

Check the UPS Ground Delivery Times map:
http://www.ups.com/maps

We’ve found UPS Ground to be very reliable.  UPS Overnight & 2nd Day, for us, has not been as reliable as FedEx was in terms of their deliverability rate.  If you do a high volume of overnight & 2nd day and will lose money/customers if a package is late, I would talk to others that have used UPS and FedEx to see if their experience is similar to ours.  Although UPS has been less expensive and our account manager, driver, and their tech support people have been superb, we have had far too many late packages.

The Postal Service (Priority Mail) is going to be cheaper than UPS Ground if you ship smaller packages (especially in the 1-2 pound range) and do a lot of shipping to residential addresses.  UPS Ground will charge you a surcharge for residential addresses of about $2.50 I believe - USPS does not AND they supply the boxes for priority mail.  The USPS Flat rate boxes are only a good deal if you ship stuff that is small and heavy (if you’re shipping books or bound material, USPS Media Rate is INCREDIBLY CHEAP - see their website for a list of what qualifies).

UPS 3Day Select is guaranteed 3 day delivery (most likely for half of the country Ground will get it there in about the same time depending on where you’re at & where you’re shipping to).  We’ve found this to be WAY more expensive than priority mail unless you’re shipping heavier packages (for us around 7 pounds seems to be where it makes sense to go with UPS 3Day instead of Priority Mail)

For supplies, we have found PTI Packaging (http://www.ptipackaging.com) to be the best.  If you’re shipping soft goods like apparel, consider self sealing poly mailers in various sizes - much cheaper and lighter weight than boxes. 

PTI Packaging has the best prices by FAR on shipping boxes & they’re very helpful on the phone.  We’ve used at least a half a dozen different suppliers over the past 15 years and they have been the best.

Hope this helps!

The RustyZipper.Com crew

hi sinks The boxes are free, you can also get priority tape for free too. You can ask for any reasonable amount that you desire. You also can order them online at the usps website. They will then deliver them to your house free of charge. Good Luck

WorldShip integrated well with her back end office systems with their help (not the most intuitive application, but they were very helpful & it’s great).  The drivers are great, dispatch center is great, pickup time is more convenient & international shipments are a breeze with WorldShip.

We’ve found this to be WAY more expensive than priority mail unless you’re shipping heavier packages

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