Are you a small business owner looking to cut costs? Make sure to avoid these common mistakes.
For small business owners — especially those who are just getting their operations up and running — it’s essential to reduce costs where you can. With the average small business spending over $4,000 per year on postage, shipping expenses are a welcome arena for cost-cutting. To help, we’ve identified five ways you may be overspending on shipping, as well as cost-effective alternatives that can minimize costs without sacrificing quality.
1) You’re Not Hunting Down Discounts
Bargain hunting isn’t just for extreme couponers. Most carriers provide discounts, especially for repeat customers who ship regularly and in high volume. Consider shopping around to see which carrier can offer you the most competitive prices. Then, see if other carriers will match or beat those prices to drive rates down further. Don’t be afraid to diversify, either: since USPS, UPS, and FedEx each offer different rates for different services, it’s best to be flexible where you can.
2) You’re Not Consolidating
Since a single large order costs less to ship than several smaller ones, combining shipments that are traveling to the same destination can save you and your customer’s money. It may seem prudent to process and send out orders as soon as they come in, but if you don’t streamline the process, you’re likely losing out on an opportunity to cut costs. By improving coordination between your sales and order processing, you can ensure a more efficient and cost-effective shipping operation.
3) You’re Using the Wrong Packaging
Even if you consolidate shipments and negotiate discounts, you’ll still end up overspending on shipping if you’re not using the correct packaging. UPS and FedEx both adhere to stringent size regulations, so double check that your boxes don’t exceed those dimensions. Generally speaking, you should always use the smallest box possible that still fits your product. Paper Mart offers a variety of boxes in a range of sizes and materials to fulfill all of your shipping needs.
When boxing up your shipment, use ample cushioning or filler material to protect the items during transit. Without it, your customer might receive a damaged delivery, making a costly reverse logistics process necessary. That said, don’t go overboard; too much cushioning will only make your package heavier and more expensive to ship.
4) You’re Billing Too Soon
If you bill customers before you know the full cost of shipping, you might end up footing the bill for the difference between the actual cost and what you charged them. Especially when you’re still getting the hang of small business shipping, special charges can add up surprisingly fast, from Saturday delivery fees to costs for packages that require a signature. Instead, hold back on billing customers until the shipping costs have been fully processed, and your business won’t have to pick up the tab.
5) You’re Not Buying in Bulk
Although it may cost more upfront, buying in bulk is a key cost-saving measure for businesses of any size. Bulk purchases are heavily discounted, especially with Paper Mart’s wholesale pricing and discounted volume purchasing. Some carriers even offer free shipping materials if you use their services. To round out your supply (and for an eco-friendly approach), consider reusing boxes from previous shipments.