Parcel - March/April 2009 - (Page 24) at what the company was paying in the way of surcharges in an effort to understand what their total small parcel delivery costs were; and make sure the mix of shipping products being provided by the carrier meets the needs of the customer. Following a thorough review process, the company successfully renegotiated their contract and realized incremental savings of more than $2 million dollars per year. It is the retailer’s obligation to become intimately familiar with his or her carrier contract. Most importantly, companies need to identify areas where one or both parties are not meeting the other’s needs and negotiate. Insist on a transparent contract and partnership. If the parties are unable to come to mutually agreeable terms, consider alternatives because significant savings opportunities may be available. Listen to Customers, Listen to Business More than ever, customers are willing to consider less expensive shipping alternatives in the interest of saving money. Studies have shown that high shipping costs are an inhibitor to an individual’s willingness to purchase online. This provides a golden opportunity for a company to demonstrate that it is an advocate and understands the consumer’s needs by offering alternative shipping solutions that provide additional savings. As a part of the evaluation process, examine all options. A company is in business to serve the best interests of its customers. Putting together the right mix of products to meet their needs may be the difference between winning and losing a customer’s trust. The long-term effects associated with increased revenue and customer loyalty can be significant. Oftentimes, retailers look at small parcel delivery services as a function of operations. The reality is that an effectively managed carrier partnership takes into account the needs and requirements of the entire organization. This is only a starting point for understanding how to work with the carrier and better manage a business. As partners, retailers and carriers must be interested in each other’s mutual success. If the carrier is not committed to working with the company in identifying ways to lower costs, improve service and build the business, then it is time to consider other options. Additionally, if the company has not seen its carrier since the last time a rate increase was announced or a renewal of the contract was in sight, then the business should consider other carriers that share in long-term goals and interests. The willingness of an organization to work together in managing all aspects of the customer experience will result in a more robust service offering, lower costs and provide for a more solid foundation during this climate of economic uncertainty. n KEVIN BROWN is the Director of Marketing for Newgistics, where he is responsible for the company’s public branding and communication initiatives, in addition to supporting strategic planning efforts in the development of new products and services for the small parcel industry. 24 MARCH 2009 | www.PARCELindustry.com http://www.PARCELindustry.com
For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.