5 Ways to Beat the Amazon Effect

fulfillment center

It’s no secret that U.S. online sales continue to grow annually. A recent Wall Street Journal article reports that ecommerce retail sales in the first quarter of 2018 were $123.7 billion dollars – that’s about a 16% increase from last year.

It’s also no secret that Amazon has set the bar high when it comes to shipping speed and shipping costs. It started years ago with their popular Amazon Prime service offering free 2-day shipping. Today, Amazon continues to roll out more shipping options like same-day delivery or even delivery within hours for certain products in some metro markets.

With both national, regional and last-mile carriers increasing costs, many brands feel it’s a challenge to win at the shipping game and rise above the Amazon Effect. Big players like Amazon can afford to take a loss on their shipping costs to the tune of billions of dollars a year. But most brands can’t afford that business model.

The good news is this – there are ways a brand can achieve faster and more cost-effective shipping methods. Here are 5 ways to make it happen.

#1 – Analyze your shipping spend

Don’t assume that all parcel carrier invoices are 100% accurate. Perform regular audits to ensure you’re being charged accurately.

You should also do a small parcel shipping analysis. A 3PL like PFC can assist you with this. Many times, we can cut a brand’s small parcel shipping costs up to 50%. We look at what shipping terms you’ve promised your customers (standard, 2-day, etc.). We review package weight and destination of your shipment. Based on the determined weight/destination, we can rate shop to find the most appropriate shipping method at the individual order level.

You can request a PFC Small Parcel Shipping Analysis here.

#2 – Rate shop and negotiate shipping costs

Take advantage of rate shopping and price negotiation tools. A 3PL can help get you access to better shipping rates. Most shipping providers will also allow you to piggy back on their rates – meaning your brand can benefit from the collective shipping volume of a 3PL.

Through their advanced shipping and fulfillment systems, 3PL’s like PFC also can closely monitor the rates and performance of many carriers at once. They can adjust as needed to ensure that you always have the best shipping model in place for your business.

#3 – Monitor the delivery performance of your carriers

Consumer expectations continue to rise for fast delivery and cheap – or free – shipping. This higher level of demand is just one more reason to make sure your carrier is delivering your goods as promised. Monitor their performance. A good 3PL will ensure that delivery performance matches the expected brand experience.

#4 – Improve order packing

2018 was the year in which many parcel carriers applied dimensional-based pricing to their shipments. This means the more space your packages take up during carrier transport, the more it costs.

The good news is that 3PL’s have in-depth knowledge of the various dimensional weight formulas used by carriers and potential discounts. They can recommend better ways to pack orders to avoid getting hit with costly dimensional-based pricing and ensure that appropriate shipping materials are being utilized for the ordered items.

#5 – Automate shipping & returns

Automating your shipping and returns processes can save valuable time and money. It starts at the time of a customer’s online order. Today’s expectation is that an order confirmation email will be received on the same day the order is placed – and be followed up shortly after with a shipment notification email and link to track the order shipping status.

An easy and automated Return Merchandise Authorization (RMA) process is also becoming more important to customers. Statistics show that today’s consumers will look at a brand’s return policy before making their online purchase. So it’s imperative to have an easy, transparent self- service returns process.

PFC recently launched an enhanced RMA solution that simplifies returns for clients and their customers. The new RMA portal streamlines the entire process – beginning with the front-end consumer brand experience and ending with backend seamless returns processing. Contact PFC to learn more.

About Promotions Fulfillment Center

At PFC, our clients’ success is our number one priority. Since 1974, PFC has delivered outstanding quantifiable results, with turnkey solutions in fulfillment and contact center services – all backed by leading technology. Retailers and ecommerce brands that partner with PFC have historically achieved considerable cost savings in excess of 35% and have significantly improved their program ROI.

Want to learn more? Email us at info@pfcfulfills.com or call us at 800-493-7063.

Category: Fulfillment Insights