How to lower shipping costs

How to reduce shipping costs credibly with a rise in revenue?

Shipping carriers have diverted trade from the Red Sea in the past few weeks. Ocean freight is taking longer routes around Africa to avoid the threat of violence in the Middle East area. Shipping parcels and freight to different places is becoming expensive. And so, shipping costs are rising for many businesses globally.

Furthermore, the shipping rates imposed by different parcel carriers like UPS and FedEx will increase in 2024. Companies have the challenge of reducing shipping costs efficiently. In addition, it is necessary to build back some profit margins for e-commerce businesses.

Calculating and understanding shipping costs is confusing for many shippers. So, we have compiled ways to reduce shipping costs in this blog. Our earlier blogs on shipping costs are also helpful. Check our blogs on shipping costs related to shipping reports, data analytics, and more.

Initially, let’s start with the concept of Shipping costs.

Shipping costs

These are the expenses involved in sending packages from warehouses to customers. Packaging, transportation expenses, labor, carrier fees, etc., form part of the shipping costs. In addition, fuel charges, taxes, shipping services, and distance contribute to shipping costs. Moreover, businesses have to find the shipping carrier that suits their needs. The cost of shipping can lead to customers abandoning their carts.

Businesses can cut down shipping costs by adopting cost-effective strategies.  Further, shippers can improve their profit margins by following reliable ways to reduce shipping expenses.

Efficient and reliable ways to reduce shipping costs

Many factors cause a rise in shipping costs. Understanding them is essential in lowering shipping expenses. Below are a few ways to reduce shipping costs and boost profits.

  • Make packaging lighter and smaller.

Packaging is an integral factor in reducing shipping costs. Shippers can optimize packaging using efficient, lightweight packing materials like corrugated cardboard, EPS foam, PET plastic, etc. Lightweight packaging helps reduce storage costs and the weight of the shipments. In addition, recyclable materials and customized packaging can save money for businesses.

By using small boxes and mailers, shippers can reduce transportation costs. Small packages occupy less space, allowing companies to ship more packages quickly. For instance, using poly bags or mailers for shipping clothes is feasible. Sustainable and durable packaging can improve businesses’ operational efficiency. Low package weights can minimize shipping costs considerably.

  • Keep DIM Weights in check.

Dimensions of parcels can make a difference in shipping expenses. Dimensional (or DIM) weights can determine the shipping costs. DIM weights are calculated based on the space occupied by a package rather than its actual weight. For instance, an irregular box containing balloons will cost more than a compact box of books. Space-consuming packages cost more.

Shippers can keep DIM weights in check by opting for small and compact packaging materials. In addition packaging efficiently and using sustainable options helps the environment. Some companies can also partner with third-party Logistics (3PL) for managing DIM weights.

  • Utilize packaging provided by shipping carriers.

Another way of reducing shipping costs involves the use of packaging provided by shipping carriers. Companies that use their packaging might face additional charges. For instance, shippers pay more if the box size exceeds the shipping carriers’ regulations.

Parcel carriers like UPS and FedEx have their branded logo on their boxes. The advantage of using carrier packaging is shippers don’t need to calculate their DIM weights. Moreover, shipping carriers give special rates or services for using their packaging.

Shippers can look for discounted supplies to decrease shipping costs. Shipping carriers like UPS offer discounts or free supplies to small businesses. Packaging materials like bubble wraps, poly mailers, etc, can be purchased in bulk. Many companies offer discounts for buying supplies in bulk. Discounted supplies will help small business owners to boost their profits.

  • Consolidate orders wherever possible

Businesses can consolidate orders in a single shipment if many items go to the same address. Shippers save money if they don’t have to pay for multiple packages. Consolidating orders improves the customer experience and reduces the need for returns. It helps in reducing shipping costs and minimizes package waste.

  • Opt for PrePaid Shipping

Shippers can purchase numerous prepaid shipping labels from shipping carriers. Prepaid shipping labels contain the required information with a barcode. It helps businesses ship packages at no additional cost. It is ideal for packages with the same weight to be shipped out often. Businesses get discounts from shipping carriers like UPS and FedEx for using their printing services. It is a way of reducing shipping costs for shippers and boosting profits.

  • Reduce shipping distances

Shipping fees increase with further distances. Shipping carriers impose a fuel surcharge if the package has to go a longer distance. In addition, parcel carriers charge more for handling the packages. Shipping packages internationally attract custom fees. Shippers need to reduce the shipping distance of their packages to save money.

Businesses can choose warehouse locations closer to customers so that the shipping charges decrease. Further, shippers can partner with fulfillment centers in each shipping zone to reduce shipping distance. These steps will help reduce shipping costs and boost profits.

  • Negotiate with several shipping carriers.

Companies need not stick with a single shipping carrier for their shipping needs. Several shipping carriers offer different prices for various services. Higher shipping volumes attract lower shipping fees. Hybrid services by UPS and FedEx use local post offices for last-mile delivery. It reduces shipping expenses for shippers. Further, smaller regional carriers offer discounts or value-added services for some locations.

Shippers can negotiate with the shipping carriers to lower shipping rates. Shipping companies offer discounts to businesses even with low shipping volumes. Competitive shipping rates provided by shipping carriers help shippers. Building relationships with the shipping carriers helps shippers reduce fees. And so businesses can reduce shipping costs and increase their profit margin.

  • Use third-party insurance

During shipping, there are chances of untoward events affecting the cargo. Businesses need to insure their products to prevent any damage or loss. For example, valuable goods like precious stones and musical instruments require insurance. Shipping carriers offer their insurance as part of the service or as a stand-alone charge.

Shipping insurance of shipping carriers can often cause a dent in a business’s profit margins. Third-party insurance companies offer cheaper rates than these shipping carriers. So, shippers can use third-party insurance to save on shipping costs.

  • Minimum purchase amount for free shipping

Shippers should set a minimum purchase amount when offering customers free shipping. Businesses can set the rate for those orders that are profitable to them and are highly purchased by customers. Payment will be for orders which don’t meet the free shipping threshold. The concept of free shipping encourages customers to buy more and avail of free shipping. Shippers can reduce shipping costs and increase their profits by this method.

As discussed above, there are many methods to reduce shipping costs.

Here are some tips for small businesses to reduce shipping costs

  • Automate shipping processes

By implementing advanced technology, small business owners can reduce shipping costs. Software solutions can automate shipping processes, give real-time tracking data, and speed up order processing. Further, data analytics helps avoid excess inventory expenses and forecasts shipping volumes. Audintel has state-of-the-art technology to help small business owners streamline their processes.

  • Customer-friendly approach

Regular assessment of data helps shippers offer shipping incentives to customers. Providing customers with real-time tracking information reduces inquiries. Further, any shipment delay notification to customers brings in a level of transparency. Small business owners can also offer loyalty programs that reward repeat customers. It can increase profit margins for shippers.

  • Partner with 3PL

A 3PL partner can lower shipping costs for small business owners. They can negotiate lower shipping rates with shipping carriers due to their shipping volumes. Further, small business owners can separate their inventory across different warehouses across the US. It helps to reduce labor costs and shipping errors.

The bottom line

Whether you are a small or large business owner, reducing shipping costs is vital. The methods described above help businesses save money and garner profits. Audintel aids its clients in managing their shipping costs and increasing their profits. Our team of experts can optimize your shipping operations seamlessly.

If you need help understanding shipping costs, contact us at +1 (619) 354 8539. Further, you can visit our Audintel website.

UPS Shipping Invoice Audit

UPS shipping invoice audit: why use a third-party auditor?

Companies shipping large volumes of parcels during the holiday season don’t have time for parcel audits. In addition, it is hard to oversee mistakes and overcharges made by shipping carriers like UPS and FedEx. So, many companies are moving towards automated audit solutions to save time and resources. This article will discuss the need for auditing UPS shipping invoices. Also, we will highlight the benefits of using a third-party auditor.

But first, we need to understand-

UPS audit-what is it?

UPS offers businesses various incentives for shipping parcels through their company. Shippers also enter into contracts with UPS for their different shipping services. However, checking each UPS shipping invoice for incorrect surcharges and late deliveries is tedious. A UPS audit thoroughly examines each UPS shipping invoice for potential errors. It helps shippers claim refunds from UPS and understand their shipping spend.

UPS shipping invoices

The contents of UPS shipping invoices require information like

  • Shippers’ name and contact address, contact number
  • Shipment details like a tracking number, shipment ID, date of shipping, invoice number, purchase order, etc.
  • Recipient’s name and contact address, contact number
  • Quantity of goods
  • Description of goods
  • Value of goods
  • Declaration statement

Further, shippers provide information about the discount, insurance, total weight, and the total number of packages. For further details, check UPS site. UPS will charge the shipper more if inaccurate and incomplete shipment information is on the shipping document. UPS has the right to audit any package to check its weight and dimensions. If there are any discrepancies, UPS will charge more to the shippers.

Need for audits of UPS shipping invoices

Parcel and freight auditing gives shippers better insights into their shipping needs. Companies can renegotiate better shipping rates with UPS based on the shipping data. An audit of UPS shipping invoices will unravel duplicate charges and other overlooked errors. UPS audits are to be quick and accurate as the window for recovering UPS refunds is time-bound. Companies can recover refunds for UPS late deliveries within fifteen days from the date of shipment. Audits retrieve money owed to companies from shipping carriers like UPS.

Benefits of parcel auditing

The growth of small parcel shipping has caused a rise in small parcel costs. With the demand for faster parcel deliveries, shippers deal with monitoring surcharges and shipping rates. As part of cost-saving strategies, companies are cutting down on excess packaging of goods. In addition, they are investing in parcel auditing services for a detailed understanding of their shipping spend.

How a third-party auditor helps companies reduce their transportation spend?

Parcel audit services by third-party auditors conduct audits on UPS shipping invoices. Their proprietary parcel audit software runs a complete audit checklist on UPS shipping invoices. The refund process is automated, and the refund amount gets credited to the shippers’ accounts directly. The auditor accesses all the shipping data and provides in-depth reports to the shippers on their shipping expenses. Some of the audit checklists of UPS shipping invoices include

  • Late deliveries
  • Lost packages
  • Duplicate Billing
  • Address correction charges
  • Residential charges
  • Incorrect Dimensional weight charges
  • Missed discounts as specified in service contracts and many more

Third-party auditors provide customized reports to companies regarding their UPS shipping invoices. It allows shippers to renegotiate with UPS regarding certain services and reduce their transportation spend.

Parcel invoice audit software

Many parcel auditors have specialized AI-driven UPS invoice audit software. The AI platform automatically audits UPS invoices every week and uncovers any hidden errors instantly. Further, the data analytics reveals UPS late delivery refunds uncompensated and other billing errors. The real-time shipping data helps shippers improve their delivery efficiency and recover lost profits. In addition, effective parcel audit software guides shippers in addressing last-mile delivery issues and optimizes shipping methods.

Partner with us for the Audintel advantage

It is difficult understanding the complexities of UPS shipping rates, surcharges, and refund processes. Audintel has experts who have worked with shipping carriers like UPS and FedEx and have a thorough knowledge of these charges. We have an AI-powered platform that automatically checks UPS shipping invoices. Line-auditing of every invoice ensures that shippers recover their shipping costs. In addition, we have a team that pursues the billing mistakes with UPS so that clients do not lose even a single dollar due to unfair billing. Our customized shipping reports provide insights into shipping data. It also provides visibility of any hidden surcharges levied by UPS after the delivery of packages. By partnering with Audintel, shippers can cut shipping costs by making smarter shipping decisions.

Final thoughts

Parcel auditing is a time-consuming process. Companies do not have the time or the resources to manually audit shipping invoices. So, auditing UPS shipping invoices for individual packages is a big task, especially for a company shipping large volumes of parcels. Outsourcing parcel auditing to experts like Audintel helps companies claim refunds for UPS late deliveries. In addition, parcel audits provide greater visibility to shippers to reduce their shipping expenses. For more information about Audintel and our services, contact us at +1 (619) 354 8539 or visit our Audintel website.

UPS Peak Surcharges

Know all about the latest updates on UPS Peak Surcharges

E-commerce orders increase in the holiday season due to high demand from customers. Ideally, the peak season for shipping is the holiday season beginning in early November each year. However, UPS has decided to continue its Peak or Demand Surcharges on packages “till further notice” in 2022. The increase in surcharges may be due to rising inflation and gas prices.

However, UPS has not cited a particular reason for the rise but mentioned increased demand for shipping services on its website. This article explores the UPS Peak or Demand surcharges with new changes in 2022. In addition, we will discuss how UPS surcharges affect businesses.

What is UPS Peak Surcharge?

The holiday season in the United States typically starts in early November and ends in January. Many customers do their holiday shopping late, resulting in high demand for shipping packages at the last minute. Shipping carriers consider the holiday season as the peak season. They charge extra fees along with the base cost of shipping. UPS names these surcharges as UPS Peak or Demand surcharges. So, UPS charges more for the additional handling of packages and oversize packages. Further, UPS levies a delivery surcharge for international or remote area shipments.

UPS Peak Surcharges-what’s new in 2022

Since 2020, UPS has had peak or demand surcharge fees throughout the year rather than just during the traditional holiday season. But, from May 2022, the peak surcharges have risen sharply for shipments from and to the United States. The calculation of the shipping rates is per pound based on the billable weight of the shipment. The surcharges are subject to dynamic changes. As of September 9, 2022, update on the UPS website, we have observed the following surcharge fluctuation. These surcharges are:

  • Set at $3.50 per package for additional handling and $40 per package for Large parcels. This fees will apply till October 1, 2022. Further, expenses are increasing to $6.50 per package for additional handling, $70 per package for Large parcels, and $400 per package for Over Maximum Limit packages after October 2, 2022, until January 14, 2023.
  • Set at thirty cents per package for domestic UPS Ground Residential and UPS SurePost packages (valid till October 29, 2022). In addition, these peak surcharges is applicable to shippers who have shipped more than 25,000 packages in any week after February 2020. The fees are regardless of the shippers’ shipment volumes for any services.

From October 30, 2022, to January 14, 2023, businesses can expect a significant UPS peak surcharge in the following services: UPS Sure Post, UPS Ground Residential, UPS Next Day Air Residential, and other UPS Air Residential. The fees are applied weekly to each package. It applies to packages exceeding 105% of a shipper’s average weekly volume (“Baseline” volume) within each service level. (Click here for more details).

UPS Peak Surcharges (applicable from January 16, 2022, till further notice) for UPS Standard shipments from Canada to the U.S. is $0.30 per package and UPS Trade Direct® shipments from the U.S. to Canada are $0.42 Canadian Dollars (CAD) per package.

UPS Peak or Demand Surcharges for various Worldwide services

UPS has levied UPS Peak or Demand surcharges for other services too. These services are for international shipments to and from the United States with different delivery times. There is an increase in fees from May 22, 2022, by UPS with no definite end date. The international services include:

UPS Worldwide Express and UPS Worldwide Express Plus: These services involve delivering packages to destinations worldwide in 2-5 days. Shippers get guaranteed on-time delivery of their packages with in-house customs clearance.

UPS Worldwide Saver: This service uses air transport and guarantees delivery by the end of a business day. Shippers choose UPS Worldwide Saver for fast deliveries and last-minute delivery of goods.

UPS Worldwide Expedited: Small and lightweight parcels are delivered internationally within 2-5 business days. It is a guaranteed service by UPS that sends packages to destinations worldwide at a lower shipping rate.

UPS Worldwide Express Freight: This service provides guaranteed, faster, palletized shipments in more shipping lanes. It is in use when shippers want to send products in an emergency. It takes 1-2 business days for package delivery. In 2022, UPS peak surcharges are increased two-fold for shipments using this service based on the weight of the shipment.

UPS SurePost: It is an economical service of UPS, wherein the last-mile delivery is by the U.S. Postal service (USPS). Shippers use this service for non-urgent, business-to-customer needs of low value. It is ideal for packages less than 10 lbs.

Note: please see the details on the UPS official U.S. website for the precise calculation of UPS peak surcharges.

Suggestions to minimise UPS Peak Surcharges

Shippers can follow some parameters like keeping the weight of packages less than 70 lbs to cut down on shipping expenses. In addition, companies can maintain the dimensions of parcels to acceptable levels. Further, using the United States Postal Service (USPS) helps to reduce peak prices and get assurance of pick of packages. On the other hand, shippers can minimize UPS Peak Surcharges with cost-saving advice from partners such as Audintel. We help shippers get discounted shipping rates and negotiate surcharges with shipping carriers. Our team analyses shippers’ data and provides insights into saving money for businesses. UPS Peak or Demand surcharges are dealt with by the team of Audintel effectively.

Final thoughts

Rising shipping costs due to surcharges levied by shipping carriers are changing the way you ship today. Keeping track of Peak surcharges, shipping rates of shipping carriers and on-time delivery of packages seems overwhelming for shippers. Audintel helps companies understand the complexity of the shipping carriers’  fees and surcharges. We simplify the shipping process for your company. If you have questions regarding our services, contact us on +1 (619) 354 8539 or visit our Audintel website.

global freight audit

LTL and TL shipping rates: know more to lower shipping costs

Speed is the need of the hour for e-commerce giants such as Amazon. Companies that deal with high shipping volumes opt for faster, cheaper ways of freight transport. Depending on the specific freight requirements, companies opt for the mode of freight shipping. Freight transportation by land is by trucks and sometimes rail.

According to the Bureau of Transportation Statistics, “trucks carry most of the tonnage and value of freight in the United States.” In addition, many factors impact trucking freight rates of shipments. This article discusses LTL and TL freight shipping modes and shipping rates. Further, we focus on picking the right freight services to save on shipping costs.

So, let’s learn about LTL and TL shipping rates, but before that

What are TL and LTL shipments?

TL (or FTL) is Truckload or full Truckload shipments. Shipments that require the entire truck are Full Truckload or Truckload freight. A whole truck will exclusively move the shippers’ goods, whether full or half empty. Shippers opt for TL freight when they want their goods to reach their destination in time or when volume of goods shipped is more.

Less-Than-Truckload shipments are known as LTL shipments. Multiple shippers share a single truck to ship their goods. It is ideal for small e-commerce businesses that do not send goods in bulk or want to save money.

TL shipping rates

TL freight delivery is faster and requires less intermittent stoppage. The Full Truckload prices are more predictable than LTL shipping prices.  Further, Truckload shipping rates are easier to calculate from origin to destination. However, factors affecting TL shipping rates include:

  • Mileage

The cost of any shipment depends on the distance it travels. Longer distances incur higher charges due to the high amount of fuel used in delivery, driver time, etc.

  • Capacity

The capacity of trucks shrinks when the trucks are booked ahead for the movement of seasonal fruits and vegetables. Refrigerated trailers, also known as reefer trailers, are set at specific temperatures to ship dairy goods, flowers, fruits, meat, vegetables, and more. These truckload shipments are slightly more expensive due to special conditions such as temperature control.

  • Peak season surcharge

Shippers face a rise in shipping rates during holidays like Thanksgiving and Christmas due to the high demand of consumers. Peak surcharge by shipping carriers raises shipping rates.

  • Flexibility and timing

Shipping rates increase if shipping carriers do not have the flexibility to ship goods, In addition, weekend pick up and odd hour timings will cost more for shippers.

  • Fuel surcharges

Shipping carriers charge fuel surcharges based on the market price of diesel. The government-approved fuel charges change weekly.

  • Accessorial charges

Accessorial charges are expenses incurred for additional work done by shipping carriers, like handling charges, extra attention to freight in loading/ unloading, etc.

TL shipping rates change with the current market and fluctuate even within a day or hour. They also vary from carrier to carrier. And so, choosing the correct shipping carrier is essential for businesses to save money.

LTL shipping rates

LTL shipments are cost-saving as shippers only pay for the space their goods occupy in the truck. LTL freight shipping has frequent pick-ups/ drop-offs at multiple locations, hence longer transit time. As a result, LTL shipping rates are complex and not easily understood by shippers. Nevertheless, the calculation of Less-Than-Truckload shipments depends on a few factors, such as:

  • Weight

LTL freight is consolidated into pallets to protect goods in transitThe weight of LTL pallets is usually between about 100 and 10,000 lbs. The heavier the shipment, the less it will cost per hundred pounds (CWT), but the total cost will increase. Most LTL class rates have six-tiered weight break-off points, including the minimum charge per shipment.

  • Density

The density of LTL freight’s calculation involves dividing the weight of the shipment by volume (length x width x height – DIM Factor). Lower density shipments take more space in the truck and will cost more. The density of LTL shipments increases or reduces LTL shipping rates.

  • Freight Class

Each trucking shipment has a freight classification that affects the trucking rates. In the US, the National Motor Freight Classification (NMFC) has 18 cargo classes ranging from 50 to 500. Determination of freight class is by value, handling, stowability, and liability. The higher the freight class, the more expensive the shipment.

  • Distance

Shipping rates depend on the distance of each shipment. Long distances are more expensive. Shippers need to know the origin and destination zip codes to reduce shipping costs. In addition, knowledge about the shipping lanes or routes having high traffic is essential.

  • Accessorial Charges

Extra services cost more and are a part of accessorial charges. Special fees for pick up or delivery from remote locations, weekend delivery, special handling charges, and fuel surcharges are expenses that contribute to shipping rates.

LTL shipping rates vary from carrier to carrier. Choosing the shipping carrier for LTL shipments is critical for saving money for businesses.

How Audintel helps you choose freight shipping mode and rates

After seeing the above two freight options, it becomes difficult to decide which shipping mode is the best for your business. For this reason, partnering with an audit company, Audintel, benefits shipping businesses to a great extent. Our team monitors the TL and LTL freight shipping rates and guides shipping businesses. We audit fuel surcharges applied by carriers to TL or LTL shipments. Our team of experts helps shippers negotiate the best freight shipping rates with shipping carriers. Further, Audintel helps its clients track, monitor, audit, contest with carrier in case of dispute their freight shipments so that there is no loss of revenue.

To Summarize

LTL and TL shipping rates depend on the shipper’s freight requirements. While LTL shipping mode is appropriate for businesses with smaller loads, it is better to know the shipping rates of TL if the load occupies more than half truckload space. Alternatively, TL shipments reach on time, but they cost more. Partnering with Audintel will help you find a balance in choosing LTL and TL shipping modes and managing their shipping rates. You can reach us for further discussions or you can call us at +1 (619) 354 8539. Further, you can also learn about our services on Audintel website.

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Shipping trends of 2022 that redefine the way we ship

The supply chain industry has faced many challenges in 2020 and 2021. This year appears to be difficult for small and mid-sized businesses. In addition to the pandemic resurgence in some countries, the Ukraine conflict has posed many challenges.

Shipping costs have risen as FedEx has hiked its peak surcharges for international parcel and freight shipments. Many areas of the shipping industry have also seen disruptions. This article will explore the shipping trends of 2022, focusing on small packages.

Shipping trends of 2022

Online buying has put tremendous pressure on the supply chain industry. E-commerce customers are expecting faster delivery and returns of items. Small and mid-sized businesses are looking for opportunities to mitigate late parcel deliveries. With this in mind, here are ten shipping trends of 2022 that will change the way we ship parcels.

  • A rise in shipping costs

Parcel carriers have hiked annual general rate increases (GRI) and surcharges leading to a rise in the shipping costs. Unprecedented consumer demand for same-day delivery has led to increased shipping volumes. In addition, inflation is surging upward due to supply chain issues. Shippers need to evaluate the services they need to spend on to offset the rise in shipping costs. Further, businesses are advised not to change their parcel carriers or renegotiate their carrier contracts. It is because parcel carriers offer less attractive terms than their existing agreements.

  • Congestion at warehouses, port terminals

Due to the pandemic restrictions in countries, the waiting time to load and unload goods has risen. As a result, there is congestion at warehouses and port terminals, causing shipment delays. There is a backlog that is hampering shipping operations. Opening new fulfillment centers or physical stores in heavily populated areas brings products closer to the public. It allows shippers to provide quick parcel shipping to their customers.

  • Digitalization

The pandemic caused a shortage of professional workers such as logistic operators. Digitalization of shipping processes like warehouse operations is improving supply chain efficiency. Shippers can avoid several manual steps during order fulfillment by using shipping software solutions. Digital solutions are reducing shipping costs and enhancing shipping processes.

  • Personalized delivery experience

Customer experience is essential for recurring shipping business engagement. It is necessary to provide a personalized delivery experience with reliable, on-time delivery of packages. Clear and transparent communication regarding delivery and tracking of parcels helps customers. Further, adopting new technology to limit package theft and enhance the delivery process are other factors to increase customer satisfaction.

  • Sustainability

An increasing number of consumers are trying to reduce the carbon footprint of parcel deliveries. Re-cyclable biodegradable material is in use for packaging and shipping goods. Further, shippers use ground services to reduce overall transportation routes. Shipping businesses keep sustainability in mind by using eco-friendly boxes and mailers. Parcel carriers are using electric vehicles for shipping parcels to customers. Moreover, shipping carriers meet environmental, social, and governance (ESG) standards by using electric-powered delivery vehicles.

  • Optimization of supply chain management

The “just-in-time” supply chain has become unpopular during the pandemic time. Shippers have shifted to holding a large buffer stock for any surges in demand and a decrease in the supply of goods. Shippers are examing their logistics and inventory data to optimize supply chain management. Inventory and e-commerce data help shippers optimize their shipping processes while reducing shipping costs.

  • Last-mile innovation

Last-mile delivery of packages is an integral part of customer satisfaction for businesses. Shortage of drivers can cause a delay in last-mile deliveries of parcels. Innovation in the form of robotics, drone, and self-driven vehicles will prevent poor last-mile delivery experiences. Some shipping businesses are already using drones to drop off medicines. However, using a drone for parcel delivery is difficult for communities. They require special permission to receive such deliveries. Big Data, Artificial Intelligence, and Machine Learning have the potential to make logistic processes more simple.

  • Reverse logistics

A drawback to the increase in online shipping is the rise in returned packages. Shipping businesses have to pay for the returns processing fee with the increased shipping rates of parcel carriers. It eats into the profit margins of shipping companies. As a result, some big businesses offer refunds and keep the product in the customer’s hands. Alternatively, some shipping companies are mitigating returns costs with a multi-carrier strategy. Therefore, shippers use artificial intelligence to calculate whether it is economical to process a return.

  • Local pop-up e-commerce distribution centers

Shipping companies respond to local shipping demands by operating local pop-up distribution centers. Shipping parcels from long distances costs more. Lessening the delivery time by renting out warehouses allows customers to receive orders sooner. Expect gig economy carriers to rise in 2022. Shippers are planning to use the services of gig economy carriers to deliver packages within a few hours to customers.

Partnering with parcel shipping audit company

2022 will be a challenging year for shipping businesses. But, partnering with the right parcel shipping audit company can save money for businesses. In addition to negotiating the best shipping rates, Audintel helps businesses receive discounts for services from parcel carriers. Audintel helps shippers analyze their shipping data for inaccuracies, accessorial charges, refunds, etc.

Finally, the Shipping industry has to change with the times. What was popular two years back is not feasible now. Shippers have to make critical decisions and adapt to the ever-changing consumer demands. Data-driven innovation will have an impact on package deliveries in 2022. Partnering with Audintel will be beneficial for shipping businesses. You can reach us for further discussions or you can call us at +1 (619) 354 8539. Further, you can also learn about our services on Audintel website.

shipping zones

UPS, FedEx shipping zones: an easy guide on shipping zones

Saving on shipping expenses is essential for e-commerce businesses. But, it gets confusing figuring out the shipping rates of different parcel carriers? UPS and FedEx have different shipping rates based on various factors, including shipping zones. Hence, knowing about zones is equally vital for businesses. In this blog, we will discuss the shipping zones of UPS and FedEx and their significance.

So, what are shipping zones?

Shipping zones are the geographical areas for the delivery of packages. The zones consist of a set of zip codes. Shipping zones give the distance a parcel takes from its origin to its destination. The zones are not universal or fixed. The zones vary according to the type of service and the weight of packages. In addition, each parcel carrier has different shipping zones. There are eight domestic shipping zones for the 48 US mainland states. A ninth shipping zone is for the US territories beyond the mainland.

Significance of zones

Free and fast shipping are essential for today’s customers. For this reason, keeping a tab on shipping rates is necessary. Shipping zones help in determining the shipping rates of parcels. In addition to the weight of packages, the dimensions also affect the shipping rates. Further, the cost and time of delivery of packages are vital factors in calculating shipping prices. For example, a parcel to be delivered in the same Zone (Zone 2) will take less time, less fuel, and will cost less when compared to a higher zone (Zone 8). Higher shipping zones cost more for size-able packages.

FedEx shipping Zones

Every year FedEx publishes its service guide with updated shipping rates by zone and weight. Shippers need to enter the package’s destination zip code to calculate the shipping rate. The standard FedEx zones start from zone 1: 0-50 miles till zone 8: More than 1801 miles. FedEx zones are available for both domestic and international shipments. Also, FedEx Express services deliver parcels fast, which is beneficial for businesses promising quick delivery. Further, FedEx offers negotiated rates for shippers with high-volume packages.

UPS shipping Zones

Shippers can understand the UPS shipping zone by entering the destination zip code on the UPS website. In addition, shippers can download the zone chart table. It gives information about shipments starting with the first three digits of the recipient’s zip code. For instance, the destination zip code which starts from 004 is Zone 2 for UPS ground services, and Zone 302 for UPS 3 Day Select service. Further, shippers can calculate the shipping rates by learning about UPS shipping zones.

Advantages of understanding Shipping Zones

Shippers benefit by learning about zones. As a consequence, they can strategize by:

  • Lowering Shipping costs

Shippers can reduce the transit time of products by partnering with third-party logistics companies. When shippers’ products are spread over many fulfillment centers closer to customers, it will keep shippers from paying high prices. Alternatively, shippers can reduce shipping costs with a single fulfillment center in a location where there are many customers.

  • Offering free shipping services

Shipping businesses offer customers free shipping if the parcel delivery is in the same zone or the next one. If the parcel is of a specific weight, shippers can give free shipping to customers.

  • Zone Skipping strategy

Additionally, shippers use zone skipping strategy to move the parcels near customers or the destination. Businesses can store their products in selective warehouses in some zones. Then, they can deliver the shipments to customers as and when required. For instance, FedEx Ground Economy uses the United States Postal Service (USPS) for the final-mile delivery of parcels. It helps in reducing the shipping costs.

  • Ability to choose the best parcel carrier

Shippers can choose a reliable parcel carrier to deliver their parcels by understanding the different zones. UPS and FedEx have different shipping rates for different shipping zones. Based on the services adopted by customers, shipping businesses can choose which parcel carrier delivers the parcels quickly and efficiently.

Audintel advises its clients regarding UPS and FedEx shipping rates. We understand the complexities of UPS and FedEx shipping zones. When shipping packages, our experts help clients choose the type of service and provide tools like rate calculator to compare between carriers. Audintel helps clients in negotiating agreements with parcel carriers.

The bottom line

UPS and FedEx shipping zones vary from each other in terms of service, weight, dimensions of packages, etc. But, this knowledge is necessary for shippers when negotiating with parcel carriers. Shippers can negotiate for discounts and other incentives by understanding the intricacies of zones. And so, if you are a shipper looking to deliver goods at fast speed and low costs, read on about UPS and FedEx shipping zones. For further clarification, you can call us at +1 (619) 354 8539 or contact us by clicking here. In addition, you can visit the Audintel website.

UPS and FedEx shipments

Our top ten reasons for delays in UPS and FedEx shipments

Online shopping has both been a boon and a bane for retailers. There is a rising demand for on-time delivery of goods in a day. Shippers and parcel carriers are racing against time to meet customers’ expectations. But even so, UPS and FedEx shipments are delivered late.

Delayed shipments negatively impact customer experience, thus causing loss of revenue. Why are UPS and FedEx shipments delayed? In this blog, let us study the top ten reasons for shipping delays.

Top ten reasons for delays in UPS and FedEx shipments

There are many reasons for UPS and FedEx shipping delays. FedEx and UPS shipping locations play a vital role in delayed shipments. In addition, UPS and FedEx delivery times vary depending on the service chosen by shippers. So, selecting the correct parcel carrier is essential for order fulfillment. Listed below are the top ten reasons:

Weather-related delays

Bad weather conditions are one of the causes of shipment delays. Inclement weather, such as blizzards, tornadoes, rainstorms, etc., makes it difficult for FedEx and UPS drivers to make deliveries on time. These delays are not eligible for a money-back guarantee by UPS/FedEx. Shippers need to inform their customers in advance of weather-related delays to show commitment to customers.

Disasters

UPS and FedEx shipment delays are due to natural and human disasters. Recently, pandemics, wars, social and political unrest, famine, floods, fires caused many shipping delays. Restrictions on the movement of goods and people have adverse effects on transportation. Hence, the delay in UPS and FedEx shipments.

Wrong documents

Several documents accompany UPS and FedEx packages. A delivery exception occurs when a parcel’s label is wrong. A commercial invoice containing the items expected by the customer is to be a part of the package. Improper documents need to be rectified, thus delaying the shipments.

Illegal or Hazardous materials in a package

UPS and FedEx label some goods as prohibited and restricted items. These goods include:

  • Alcoholic beverages
  • Ammunition
  • Firearms and weapons
  • Live animals
  • Precious metals
  • Fresh food and more

The entire list of prohibited and restricted items is available at UPS and FedEx sites. Shippers need to provide a declaration regarding the goods before they can be delivered. As a result, delivery delays occur.

Missing custom clearance documents

It is necessary to have custom clearance documents for international UPS and FedEx shipments. The documents include a commercial invoice, certificate of Origin, North American Free Trade Agreement Certificate of Origin, Electronic export information, and shipping label. The package is held at a customs facility or the carrier’s distribution facility when any documents are missing.

Incorrect address

Packages need correct addresses for on-time delivery. Wrong addresses on packages cause delays in FedEx and UPS shipments. For instance, customers having several delivery addresses may give the wrong address to shippers. Or shippers’ systems may enter the incorrect address for the package. Further, a delivery executive may deliver the parcel to the wrong apartment by misreading the label. Whatever may be the reason, the parcel carrier has to pick up the package from the incorrect address and deliver it to the correct address, thus causing a delay.

Holiday surge

Thanks giving, Christmas, or any National Holiday benefits businesses. However, due to the increase in shipping volumes, customers are advised to shop early. Ideally, parcel carriers offer holiday deadline dates, so customers get their packages in time. But, holiday shipments may overwhelm parcel carriers’ capacities, thus causing delays.

Unavailability of the recipient for package

For package delivery, FedEx requires a recipient’s signature to deliver parcels. Sometimes, at the time of delivery of packages, recipients are unavailable at the address. But, if the recipient is a business, and a parcel arrives outside business hours, FedEx attempts delivery another day. Failed delivery attempts by parcel carriers are the reason for the return of shipments by parcel carriers.

Poor performance of shipping carriers

Shipping carriers may suspect illegal items in packages and therefore delay shipments. Further, UPS and FedEx have different delivery times and schedules for various packages. Alternatively, prioritized parcels may get preference over others. Shipping carriers’ performance is poorly rated even if a package arrives late at a fulfillment center. All these factors cause delays in shipment.

 Staff shortage

UPS and FedEx face labor shortages for many reasons, including pay and benefits. For the past two years, shipping carriers finding it difficult to retain employees. It is mainly due to people opting for working from home and not wanting the stress of blue-collar jobs. Thus, causing an impact on UPS and FedEx delivery times.

How to prevent UPS and FedEx delivery delays?

Shippers need to address the areas where the delays are occurring. Our tips for preventing UPS and FedEx shipping delays include:

  • Cross-checking shipping information for incorrect addresses and shipping labels
  • Open communication with customers regarding delays due to bad weather and disasters
  • Automating the custom clearance documents and other necessary documents
  • Order in advance to beat the holiday surge

Partnering with Audintel helps shipping businesses keep track of each shipment. Our clients benefit immensely from our customized dashboards and shipping reports. Shippers receive refunds for delayed shipments from parcel carriers with ease. Audintel‘s team helps shipping businesses to negotiate good carrier contracts and save money.

Conclusion

Delivering packages on time is easier said than done. There are lots of variables involved when UPS and FedEx deliver packages. Our top ten reasons for delays in shipments and ways to prevent delays give a brief insight regarding delayed shipments. However, keeping track of delivery expectations is best left in the hands of experts, like Audintel. We help shipping businesses deal with UPS and FedEx shipping delays. Still unsure about what to do in case of shipping delays, call us at +1 (619) 354 8539 or contact us by clicking here or visiting the Audintel website.

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What can you expect in the new year from FedEx and UPS General Rate Increase?

FedEx and UPS issue General Rate Increases(GRI) every year. Businesses have to prepare for rising shipping costs based on their shipping profile. Keeping this in mind, we would like to study the General Rate Increases (GRI) of these two premium parcel carriers for 2022. We will also look at the increase in surcharges and other additional charges of the two shipping carriers.

This article will help shippers understand the price changes in 2022 and choose the parcel carrier according to their needs.

Highlights of General Rate Increase 2022

General Rate Increase (GRI) gives shippers an estimate of the rise in base shipping rates. Depending on the contract negotiations with the parcel carriers, the impact on the shipments for shippers will vary. In addition, accessorial charges also increase every year. The shipping costs vary based on factors, such as distance/zonedimensional weights, and more. So, our team at Audintel has identified three key highlights from the GRIs of 2022. Further, this comparison is for the United States domestic shipping rates and surcharges only.

A General Rate Increase at the service level

FedEx and UPS offer competitive rates for the domestic US shipping market. However, there appears to be a marked rise in the shipping rates, as seen in the below charts.

List rates of UPS and FedEx

The charts (Fig. 1 and Fig. 2) are for list rates, mainly focusing on 1-pound packages in zone 2. There are eight zones for US domestic shipping zones based on distance. As the distance increases, so do the shipping costs. The shipping list rates are calculated based on the weight of the packages and the shipping destinations. In this chart, UPS and FedEx Ground services show a ~6.8% increase in rates from 2021. Incidentally, parcels with a dimensional weight of more than 150 pounds appear to have a low rate increase.

UPS Rates 2022

Fig. 1: UPS 1lb daily rates  for services in Zone 102(Next Day Air), Zone 242 (2nd Day Air AM)Zone 202 (2nd Day Air), Zone 2(Ground) for destination ZIP codes starting with 004-005

FedEx Rates 2022

Fig. 2: FedEx 1lb rates  for services in Zone 2

Minimum charge reductions as seen for UPS and FedEx

A discount for low-weight packages is possible with minimum charge reductions. It is known as “Minimum Net Charge” by UPS and “Minimum Package charge” by FedEx. Both parcel carriers, UPS and FedEx, offer minimum charges to their customers. Shippers having a large volume of shipments can negotiate for minimum charge reduction in their carrier agreements.

UPS Minimum charges

Fig. 3: UPS Minimum charges for packages

FedEx Minimum Charges

Fig. 4: FedEx Minimum charges for packages

Thus, negotiating for minimum charges with parcel carriers is vital for shippers. Our experts in Audintel help businesses negotiate minimum costs in their contracts. Contact us for further information on UPS and FedEx minimum charges.

Accessorial fees and surcharges

With the General Rate Increase announced each year, accessorial fees and surcharges increase annually. We see an increase in some vital surcharges, such as Additional Handling Charges, Delivery Area Surcharges (DAS), and Residential Surcharges. The impact of these surcharges affects the bottom line of shippers. In the case of UPS, an immense change in 2022 is the addition of Remote Area Surcharges for the lower 48 states. It is known as “US48 Remote Area Surcharge”. Earlier, the Remote Area Surcharge was for some zip codes in Alaska and Hawaii.

UPS Surcharges 2022

Fig. 5: UPS Surcharges

Fig. 5 of UPS surcharges indicates an increase in shipping prices zone-wise. In addition, it appears the introduction of Remote Area Surcharge for additional zip codes in the US will affect the profits of some businesses.

FedEx Surcharges 2022

Fig. 6: FedEx Surcharges

For FedEx surcharges, our observation is that the Additional Handling Surcharge for zone 2 is less than the charges of 2021. Further, the oversize charges for zone 2 are less than the amount charged in 2021. This information is vital for businesses sending oversize parcels to zone 2. It is good news for shippers sending packages for short distances.

As seen in the above charts, the surcharge increase is due to Additional Handling Charges of packages. In addition, Large Package surcharges (UPS) and Oversize packages (FedEx) indicate the rise in price due to the size of the parcels.

Worried about rising shipping charges – let Audintel help you

Our intuitive audit platform provides innovative solutions to businesses. Audintel addresses the challenges faced by shippers. Our team aids shippers in reducing the impact of the steep GRIs, announced by shipping carriers. We help businesses to

  • negotiate better deals
  • receive discounts for services, surcharges
  • choose the best-quality services of alternate, low-cost parcel carriers

Audintel supports shippers in reducing the shipping charges announced by shipping carriers with our contract negotiations services.

Closing Remarks

Choosing the ideal shipping carrier is difficult. In addition, different shipping carriers have various shipping pricing models that may confuse the shippers. Audintel’s team aids businesses to have a clear idea about the carrier agreements they are signing with the parcel carriers. Our aim is that shippers save money and garner profits simultaneously. So, learn about the impact of GRIs affecting your parcel delivery from Audintel. Reach out to our team at [email protected] or by visiting the Audintel website or call us at +1 (619) 354 8539.

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How Audit companies deal with Freight logistical and operational challenges?

Nowadays most companies are leveraging worldwide logistics to spread their footprints globally. Companies will incur huge costs in transportation hence Transportation Cost Control is required to be competitive in the market. To optimize cost and overcome the freight logistical and operational challenges, industries are consulting freight audits and payment companies.

Freight audit and payment companies will help identify the challenges industries are facing with respect to logistics and operations.

Common freight logistical and operational challenges

Dealing with Bulk Data:

The number of shipments is increasing day by day and the companies use multiple carriers for shipment which leads to the bulk of invoices. The amount of paperwork backup required to validate the charges increases tremendously which is impacting the amount of time required for freight reconciliation and also on-time payments. Hence affecting supplier/partner relationships and hugely impacting business.

Improper Freight Billing:

If the carrier contact information or weight information on your bill of lading is entered incorrectly, carrier obtains inaccurate shipment information and that can lead to a number of consequences such as delayed delivery and overcharging on the freight bill. Audintel uses advanced business intelligence solutions to achieve 100% correct billing.

Higher Shipping Rates:

Shipping cost is one of the major contributors to overall Inbound and outbound logistics costs. Shipping expense is something every company has to worry about. We need to be careful in choosing the right carrier and right shipping mode when transporting goods to larger distances as this will incur higher costs. Audintel analyzes the market data to determine how well a carrier is performing and compares the cost of transport against different carriers. Audintel also helps in making tactical and strategic decisions by choosing the right carriers with the lowest cost possible.

Data Transparency:

Companies have access to lots of data at the same time it became difficult to get easily accessible information. Visibility and understanding of data are very important for companies to make the right decisions.

Dashboards are an important component of Auditing companies. Audintel provides new dashboards highlighting a variety of data including shipment overview, annual summary details, audit activities, net spend, etc…

How do Freight Audit Companies help in freight logistical and operational challenges?

Freight audit companies examine the freight bills to verify information on invoices and ensure that the invoice has not already been processed using EDI (Electronic Data Interchange). By automating Freight reconciliation, we can eliminate paperwork and errors caused through manual work. If errors are found on the invoice Freight audit company reaches out to the carrier and ensures corrected invoices are sent whenever errors are found in invoices.

According to third-party logistics research, lowering transportation costs is at the top of the list of logistics sector priorities. Increased optimization using advanced shipping analytic tools makes it easier for the clients to choose the cost-effective carrier and analyze data to determine how well a carrier is performing.

Using BI, Visualization, and Data analytics to spot trends, Audintel provides powerful and interactive Dashboards for clients. Dashboards are also featuring drill-down functionally. At the highest corporate level, the dashboards are designed for the client to view the graphs. It also provides graphic breakdowns of your current rate sheets, so you can quickly see what your rates are with each carrier.

Streamlining invoice processes, reducing costs through invoice audits, and providing actionable insights are just a few of the benefits. All of the steps that were previously completed manually can now be completed using the services of a freight provider and their automation.

Conclusion :

Audintel provides shipping logistics companies full visibility of their supply chains and manages their resources efficiently. Features like Freight Audit, optimization, selection of carriers and data transparency helps customers in choosing the best suppliers. To learn more services provided by Audintel, contact us at [email protected]. You can also learn about our services by visiting Audintel Website or call us at +1 (619) 354 8539.

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Main takeaways from the UPS General Rate Increase of 2022

UPS General Rate Increase for 2022 will affect businesses. So, know the new surcharges announced by UPS.  Further, find out how to minimize shipping costs.

It’s that time of the year again! The time when different parcel carriers announce an increase in their shipping rates. Incidentally, UPS has announced its General Rate Increase (GRI) some time back. In addition, UPS has also made changes in surcharges and fees. This article will explore UPS GRI, new changes, and its impact on businesses. Also, we will discuss the ways to minimize the overall shipping costs due to UPS GRI.

What’s new in UPS GRI 2022?

Shipping carriers like UPS announce their annual General Rate Increase. According to the UPS notification, UPS GRI will be effective from December 26, 2021. There is an increase in shipping rates for UPS ground, air, and international services to around 5.9%. Parameters like the weight of the packages, zones, and zip codes are part of the rate increase. Some of the UPS services like:

  • UPS SurePost services
  • UPS 3 Day Select services
  • UPS Next Day Air Services

seems to show a marked increase in shipping rates.

In addition to the rate increase, there have been changes in surcharges too.

Changes in accessorial fees and surcharges

UPS GRI does not include the fees and surcharges which have seen an increase. The surcharges include:

  • Peak Surcharge

It is also known as a demand surcharge. When the demand for shipments is more at the peak time of the year, UPS charges more.  But, for 2022, a peak surcharge has been introduced for international packages shipped to and from the United States. The shipped packages will be charged based on the weight and at different service levels. In addition, this surcharge also applies to UPS domestic shipments such as  UPS® Air Residential, UPS® Ground Residential, and UPS SurePost® Packages.

  • Value-added Services and other charges

UPS has increased the charges for additional handling of packages based on weight and dimensions. In addition, large package surcharges are also rising in 2022. On the other hand, minimum charges for packages between 1 and 5 lbs are also set to rise. Further, shipments to remote areas will see an upward rise under US48 Remote Area Surcharge (RAS). UPS has added a delivery area surcharge due to the population rise in some zip codes. The RAS includes additional zip codes in the delivery area. For example, package delivery to Hawaii will cost $1.35 more in 2022.

  • Fuel surcharge

Like all other parcel carriers, UPS has altered the fuel surcharges. The U.S. Ground and Air Services will see the change due to fuel surcharges. Fuel surcharges change without initial notice to consumers. The fuel surcharges apply to transportation charges and other charges such as Delivery charges, pickup charges, Saturday delivery and pickup, and more. For further information on fuel rates, click here.

Impact of GRI on businesses

GRI is declared by parcel carriers annually. In addition, the surcharges also increase exponentially every year. In such circumstances, shippers need to either bear the expenses or pass on the extra costs to the customers. It leads to shopping cart abandonment by many customers. The impact of GRI on businesses like furniture, home goods, etc., is massive. The shippers need to find a way around it. Alternatively, shippers need to renegotiate the carrier agreements with the parcel carriers. Parcel audit companies like Audintel advise businesses about the impact of GRI and surcharges. We, at Audintel, read the fine print of the contracts so that shippers get a fair deal.

How does Audintel minimize the overall shipping costs due to GRI?

Each business has its shipping attributes and profiles. Audintel studies the different aspects of each business shipment and its shipping needs. We guide shippers in negotiating with shipping carriers regarding discounts and the impact of GRI. So, any change in GRI and surcharges reduce the effect on our customers. Our team of experts guides businesses in selecting alternative parcel carriers and service levels to minimize the GRI impact. For instance, if our customer finds UPS Select Services expensive, we recommend alternate cheaper services provided by competitive parcel carriers.

To Summarize

UPS GRI 2022 has brought many changes in the shipping rates and surcharges. These changes make a tremendous impact on the shipping costs of businesses. E-commerce retailers get alert about the general rate increase from the corresponding carriers. They can avoid the impact on their businesses by making quick decisions. Shippers partner with parcel audit companies like Audintel to balance their shipping costs. Our team negotiates on behalf of businesses to get favorable carrier agreements. Shippers save money and time with the advice given by the experts of Audintel. For further information about GRI and other issues, contact us at [email protected]. You can also visit our Audintel website or call us at +1 (619) 354 8539.