Businesses should start getting concerned about the ridiculous increase in courier rates this year. Although the world doesn't hear much about the strategies of famous shippers like FedEx and UPS to increase profits, their rate increases are as obvious as it gets. Maybe that's their way of gaining profits. Are they losing money which led to the high increases? That's another story.
How big is the increase? There is an average of 4.9 percent increase in shipping base rates. Those who will be more affected are people who ship less than 30 pound packages. Compared to last year, the base rate is subject to 7 to 8 percent increase. The biggest names in courier services like FedEx and UPS are part of this.
This increase will be a shocker for everyone. But what's more shocking is the increase in subcharges and accessorial fees. The increase in base rate is more understandable but the subcharges are hitting the roof. With UPS alone, the residential delivery subcharge increased by 10 percent already. Wrong address surcharges increased by 9.1 percent. The price hike is ludicrous but there's not much we can all do about it.
So, how can this impact your business? If your business frequently sends out packages to clients, this huge increase in shipping costs can really drain your budget. What can you do about this? If you don't want to be a victim of this ridiculous charges, you may want to try negotiating for your shipping fees. You can negotiate for the accessorial and subcharges. It will be a great way to manage your shipping budget and expenses this year.
Negotiation can be an option but before you do it, do some reading on what fees you can negotiate for. There are charges that companies really cannot lower down. Know what you can and cannot negotiate so you'll not waste any time with the courier. You should always try to negotiate because the price hike is not temporary. It may even increase more in the next years. If you want to manage your budget, you can also try to adjust your shipping methods and strategies.
Big and small businesses are both victims of this increase. And with the dispirited economy, things may not change any time soon. Price hikes will happen left and right and this will surely affect your business. Protect yourself, learn more and try negotiating on shipping fees. Saving a few pennies or dollars on every package will be extremely helpful.
How big is the increase? There is an average of 4.9 percent increase in shipping base rates. Those who will be more affected are people who ship less than 30 pound packages. Compared to last year, the base rate is subject to 7 to 8 percent increase. The biggest names in courier services like FedEx and UPS are part of this.
This increase will be a shocker for everyone. But what's more shocking is the increase in subcharges and accessorial fees. The increase in base rate is more understandable but the subcharges are hitting the roof. With UPS alone, the residential delivery subcharge increased by 10 percent already. Wrong address surcharges increased by 9.1 percent. The price hike is ludicrous but there's not much we can all do about it.
So, how can this impact your business? If your business frequently sends out packages to clients, this huge increase in shipping costs can really drain your budget. What can you do about this? If you don't want to be a victim of this ridiculous charges, you may want to try negotiating for your shipping fees. You can negotiate for the accessorial and subcharges. It will be a great way to manage your shipping budget and expenses this year.
Negotiation can be an option but before you do it, do some reading on what fees you can negotiate for. There are charges that companies really cannot lower down. Know what you can and cannot negotiate so you'll not waste any time with the courier. You should always try to negotiate because the price hike is not temporary. It may even increase more in the next years. If you want to manage your budget, you can also try to adjust your shipping methods and strategies.
Big and small businesses are both victims of this increase. And with the dispirited economy, things may not change any time soon. Price hikes will happen left and right and this will surely affect your business. Protect yourself, learn more and try negotiating on shipping fees. Saving a few pennies or dollars on every package will be extremely helpful.
About the Author:
Joseph B. Kappernick works with companies to help them reduce their logistics and shiupping costs. Please visit NPI to learn more about logistic vendor cost optimization
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