Ecommerce parcel cost represents a large portion of the expenses that chip away at your profits. With rising carrier rates and evolving customer demands, optimizing spending has become vital to remaining competitive.
Let’s explore seven steps you can take to implement more effective parcel spend management for your business.
The first step in parcel spend optimization is understanding your current shipping costs. To perform a proper analysis, you need to:
For many ecommerce businesses, the key to taking control of a ballooning parcel spend uncovered in their analysis is moving away from a singular carrier strategy and adopting a multi-carrier plan.
When developing your strategy and selecting carriers to add to your mix, consider a strategic partner like Green Mountain, the industry leader with the world's largest repository of parcel spend intelligence. When combined with a platform like Shipium, which integrates with the systems that power your supply chain, you implement plans quickly, realizing savings immediately.
Outbound shipping is often one of the top operational expenses for ecommerce shippers. Securing optimal rates and terms from carriers saves you money and boosts your competitive edge.
Negotiating favorable contracts requires you to:
For an ecommerce brand, navigating multiple contract structures and data asymmetry makes managing multiple carriers a challenge. However, using data-driven multi-carrier shipping and parcel spend management software can provide the intelligence to get more value from your carrier contracts.
For example, a solution like Shipium Simulation allows you to test and analyze how changes to your carrier contracts would affect your operation. This type of insight enables you to negotiate armed with an understanding of how specific updates, such as adjusted surcharges, would benefit or increase shipping spend and future network performance.
Many shippers don’t realize how much packaging size can affect their parcel spend management. According to Canada Post, adjusting box sizes by just 2 cm on each side could reduce parcel shipping costs by up to 8%.
To enhance your cartonization strategy to uncover cost-saving opportunities:
Learn how Shipium’s packaging planner API can help you optimize cartonization and lower shipping costs.
Streamlining operations reduces processing times, minimizes errors, and optimizes resources. Optimized logistics not only enhances parcel cost management and efficiency but also enables higher volume handling, allowing you to scale your business.
Start by:
The right software partner can make optimization intuitive. For example, Shipium streamlines shipping operations with Fulfillment Engine, automating order routing and reducing delivery expenses by 10% on average.
Harmonizing logistics with your broader ecommerce supply chain using API-first software driven by machine learning can save time, money, and resources. When selecting the right technology solutions to modernize your shipping operations, look for tools that:
Explore the top mistakes to avoid when picking shipping technology with our industry guide.
With complete visibility into how your orders move through the supply chain and into the hands of your customers, you can see where potential cost efficiencies exist in your operations. This insight makes optimizing your time-in-transit and managing shipping expectations less challenging, improving the overall customer experience.
With robust supply chain data, you can:
Parcel expense management requires continuous analysis and real-time tracking. Taking a closed-loop approach to parcel fulfillment, you can create a more responsive and adaptive process that continuously improves as your business scales and the ecommerce landscape evolves.
To refine your process, ensure you:
Consistent monitoring of performance and expenses catches inefficiencies or inaccuracies often unnoticed in high-volume shipping operations. This auditing approach uncovers potential cost savings and operational improvements. Case in point: Green Mountain’s parcel audit software helped a high-volume retailer (over 400 million shipments a year) uncover a carrier invoice billing error, saving over $55 million.
Leveraging the partnership between Green Mountain and Shipium, you can get robust strategies for optimizing parcel spending and the tools to efficiently execute these plans within your supply chains.
The combination of Green Mountain and the Shipium Platform enables:
Book a demo today and discover how Shipium and Green Mountain can provide your business with the best parcel spend management solutions.