You might be overspending on postage because of a simple catch-22: Your venture is too small to justify a full-time mail operation. No matter what size your scale of operation is, you can save money on business shipping costs. The extent to which all of this matters matter depends on whether you’re shipping merchandise or simply letters, but not optimizing things can result in a small business overpaying by up to 40%, according to Tompkins Logistics.
Partner with Carriers
By working more closely with mail carriers or logistics specialists, you can determine whether and when it’s most effective to send things by ground services or air mail — based on packages’ weights, sizes and values.
Outsource and Spend Less
The startup ecosystem includes an ever-growing array of service providers that aim to help small businesses outsource their postal and courier needs without overspending. Get quotes from at least three of them — they include the following companies:
Weigh Fees Against Speed and Service
The services these outfits offer can include a variety of fulfillment and order management capabilities. Deciding whether and how much of your operation to outsource calls for an assessment of priorities regarding speed and service versus cost.
Get Free Boxes and Envelopes
One area in which it’s easy to overspend: Buying your own boxes and envelopes instead of getting them for free from the U.S. Postal Service, United Parcel Service, and Fedex.
It”s also easy to end up with packaging that adds unnecessary bulk to your shipment, making it more expensive. But spending too much time fussing with wrapping takes time away from managing core aspects of your business — at a certain point, it’s easier to hand this over.
Skip SmartPost and SurePost
While these outfits can help you save money on packing supplies, you’ll give that savings right back if you use Fedex SmartPost or UPS SurePost. Instead of using either of them try using the U.S. Postal Service’s Priority Mail or Parcel Select.
Remember Insurance and Tracking
Another thing that you don’t want to overlook: insurance availability, package tracking and delivery confirmation — all of which can set you apart from the competition. People want to know when their package is arriving and have recourse if it doesn’t arrive.
Use Less Paper
If you’re still mailing out paper letters to customers or supply chain partners — instead of doing it all electronically — you might be overdue to start asking people if they want to opt out of paper mail or opt into only receiving electronic communications.
Document Carrier Performance
Remember that you don’t have to get married to any of companies you choose to work with; track their performance if the service doesn’t live up to your expectations, revisit the terms of your contract.
Renegotiate if your needs change — you should be able to haggle for better terms if your volume goes up.
Save Money on Business Shipping Costs
Postage and shipping may seem like a rather mundane aspect of doing business but it’s gotten more critical now that customers have gotten accustomed to receiving shipments faster.
Fellow entrepreneurs, how much are you spending on postage — and what have you done to try to bring down the cost?
Jackie Cohen is an award winning financial journalist turned turned financial advisor obsessed with climate change risk, data and business. Jackie holds a B.A. Degree from Macalester College and an M.A. in English from Claremont Graduate University.