Forums: Discussions for entrepreneurs and small business.

Can somebody explain to me the best way to go about billing retailers for shipping costs.  I sell a fairly light weight item (pillow), but it is somewhat large about 15"x9"X 4".  I am just getting started, and I am not sure how to deal with the issue of billing for the shipping costs to retailers. I have a minimum wholesale order of 8 pillows, so the box needs to be somewhat on the large size. With the numerous variables incountered (number of pillows, location of delivery), not sure how to best do this.  I am not looking to make money on the shipping, I just want to make sure I don`t end up holding the bag for the shipping costs.

Any suggestions?

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Anthony Calvert
PODillow, Inc.

I`m not an expert on this, but when you`re shipping to a retailer, you would usually have a PO number---purchase order. That means the purchase has been approved by their accounting department (and management). You get the PO# as an "almost ready to buy this" after you`ve made the sale by phone or contact. Then you invoice them, including taxes and shipping, and include the PO#. So they already know the price and S&H and it`s been approved within a few dollars.

I get it, so you wouldn`t "invoice" them until after you have shipped, and you know the shipping charge? correct?  I guess the only down side to this is if they (retailer) wants to make the purchase right away by putting it on a credit card.  You wouldn`t know the shipping amount at that time.

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Anthony Calvert
PODillow, Inc.

When I saw what you were shipping, I immediately knew your problems were different from many other shippers.  Shipping pillows can be a nightmare.  The good news is you are not the first company I have dealt with that has this issue and maybe I can give you some ideas they used. 

 

Light large objects mean that dimensional weight or oversize issues will come into play.  Therefore, the first thing you need to do is to come up with standard boxes that optimize the amount you can put in the box at the best carrier prices.   This will take some work on your part but will pay off big once completed.  Reviewing rates across multiple carriers is highly suggested and be sure to look at them for all zones. 

 

You might also look at ways to compress your pillows in packing, if at all possible.  Since you are shipping pillows consider using recycled paper and strong boxes for packing material rather than environmentally friendly packing peanuts.  In most cases weight and/or damage from dropping is not your issue.  Instead you need to figure out how to get the most you can in the smallest box as possible.

 

Once you find the right combination of packing, box size and volume you will be able to have a known shipping amount for price quotes.  I believe giving the price based on how many boxes you are sending at known shipping amounts rather than trying second guess variable oversize costs will give you the edge you are looking for.

 

I hope this helps and you sell a bunch (in the right boxes that is…)!

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Bert at Harvey Software, Inc.
Multi-Carrier Shipping Software and Supply Chain Solutions for Internet Retailers

Also a provider of free shipping information and resources at Harvey Software`s Parcel Shipping Blog along with free tracking solutions at TrackingPage.com...

and for sure - check ALL the shippers - in the pst DHL was the highest and I found this past week that they are far below UPS, Fedex and totally lower than USPS. Right now UPS rates are higher than everyone - guess it`s all those right turns they`re making.... 

You are right.  The days are over when one can say one carrier is less than all the rest.  USPS can now change rates with only 30 day notice and fuel service charges can change monthly with all the carriers.  Many of the carriers offer special rates at different volumes which can dramatically change everything.  Even special rates can vary weekly.  One carrier may be the best way to ship from point A to B but not from A to C today but this is subject to change with very little notice.  This is why one must do multi-carrier rate comparisons when they are doing the math.  They must use automation to optimize things when shipping variable quantities of goods.

 

Outside of rating, another important issue is to consider how reliable the carrier is at delivering the package on time and in good shape.  If the pillows shipped arrive late and look like they were run over by a forklift, future sales may be in question.  So there is a lot of things to consider when deciding how to ship a box, especially an oversize of pillows.

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Bert at Harvey Software, Inc.
Multi-Carrier Shipping Software and Supply Chain Solutions for Internet Retailers

Also a provider of free shipping information and resources at Harvey Software`s Parcel Shipping Blog along with free tracking solutions at TrackingPage.com...

Acal,

I know this doesn`t answer your question directly, however, this information may still be of some use once you find the best packaging and all. The following two websites each provide an easy and unique way of finding the cheapest shipping option. I believe, in your case, that RedRoller is the most applicable. Good Luck!

www.redroller.com

www.uship.com

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J.J. Thomas, JD/MBA

Entrevisor - Entrepreneur Advisory Services

www.Entrevisor.com

Entrevisor@Gmail.com

It is my opinion that these sites will not help in this case.  I believe that Redroller is mainly a DHL and USPS re-marketer limiting the number of choices to just these carriers.  I also feel that Uship is really more for one time special shipments and not regular daily shipping.  I think visiting the individual carrier web sites may be better in this case for initial research.

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Bert at Harvey Software, Inc.
Multi-Carrier Shipping Software and Supply Chain Solutions for Internet Retailers

Also a provider of free shipping information and resources at Harvey Software`s Parcel Shipping Blog along with free tracking solutions at TrackingPage.com...

Thanks guys, I will consider all of these options.  I already check out redroller, but not sure that is going to work.  Unfortunately, this shipping is much more of an expense than I thought

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Anthony Calvert
PODillow, Inc.

Another idea is to check out http://www.packworld.com.  They may have a way for you do vacuum compression of your pillows so you can get more in a box.  There are other solutions that come up when you Google "vacuum compressing pillows for shipping".  Don`t give up, I am sure there is a good solution out there...Good luck!

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Bert at Harvey Software, Inc.
Multi-Carrier Shipping Software and Supply Chain Solutions for Internet Retailers

Also a provider of free shipping information and resources at Harvey Software`s Parcel Shipping Blog along with free tracking solutions at TrackingPage.com...