Common and Costly Shipping Mistakes

Shipping products is a necessary component of running a business. According to a new report from Pitney Bowes, parcel shipping exceeds 131 billion in volume globally and is likely to double by 2026. Companies must correctly manage shipping and delivery expenses to prevent negative effects like slowed productivity, dissatisfied consumers, and burgeoning shipping budgets. Unfortunately, these six common and costly shipping mistakes affect even the most diligent organizations. The good news is that all of them can be limited with a few simple changes.

Invoice Errors

common costly shipping mistakes

Invoice errors or miscalculations are more common than you might expect. Nearly 2% of all shipping invoices contain errors. The most common inaccuracies include:

  • Fuel and Shipping Miscalculations – Fuel prices fluctuate, so it’s no surprise that miscalculations happen regularly. Make sure shipping contracts clearly state acceptable margins of error on fuel charges. In addition, shipping miscalculations are related to inaccurate weights and dimensions of packages.
  • Accessory Charges – relate to special instructions or tools required for delivery. For example, charges can be added to access a gated community or deliver a heavy load up or down stairs. Another common accessory charge is for unique tool usage, like lift gates, forklifts, etc. These charges are hard to know whether they are legitimate. Ensure you trust your carrier and have the relationship to question when something seems out of the ordinary.
  • Detention – occurs when your shipment isn’t ready for pickup during the allotted time. Often these terms are set beforehand, but you can be overcharged for the time the carrier waits.

The best way to avoid common shipping mistakes is to audit invoices. Whether you take the time to review them or invest in automated invoice technology, it is crucial to double-check for accuracy. Given the numbers, you could save your company 2% on shipping costs annually.

Incorrect Measurements and Dimensions

Incorrectly measuring or weighing parcels is probably one of the easiest shipping mistakes, yet it is one of the most costly. Shipping charges are calculated based on actual dimensions, density, weights, and volumes of parcels. If an estimate is off by even a few ounces, it can result in thousands of dollars of surcharges, especially when shipping more than a few daily orders.

Depending on the carrier, they could even return the package to the warehouse and make you pay for redelivery at the correct amount! This delays the package, costs your company double the shipping, and doesn’t provide your customer with a good experience.

Ensure your packages have precise dimensions and weights, using a tape measure and calibrated scale. It is a simple step that busy entrepreneurs often miss.

Improper Packaging

common costly shipping mistakes

Packaging your products in a box that is either too big or too small can cost you money. Improperly packaged products are prone to damage and breakage. Furthermore, you could be overpaying for shipping using an oversized box (albeit standardized). Here are four ways right-size packaging can boost profitability. Packages that are delivered that have sustained shipping damage also do not showcase your brand well. Utilizing packaging and materials that protect your product and showcase your brand saves you money long-term.

Offering Free Shipping When You Cannot Afford It

A common and costly shipping mistake is offering free shipping when it doesn’t make financial sense. Of course, customers want free shipping but do not offer it if it will place your business in a financial bind. A quick evaluation of your accounting records will tell you whether or not it is viable. Here are a few “free-shipping” options that might still allow you to offer it as a special event without breaking the bank.

No Shipping Insurance

This is an easy mistake, especially when you want to cut corners. Unfortunately, the sender covers any shipping damages or losses. This is why it is crucial to insure your products. Regardless of shipping insurance, you can recoup losses and damages when the unexpected occurs.

Incorrect or Incomplete Delivery Details

common costly shipping mistakes

A silly but common and costly shipping mistake is inaccurate or incomplete delivery details. From incorrect addresses to vague delivery details like the floor or suite number can cause delivery delays, returns and cost you money. Double check address details and ensure if there are special delivery instructions that either the customer covers the expense or verify you can absorb the cost. Invest in online address verification technology. When a customer inputs their address it will confirm the details by cross-referencing them against known addresses. If there is a mistake, it can autocorrect at the input point.

Beginner’s Guide to Third-Party Logistics (3PL)

The world of e-commerce is always changing, therefore understanding the roll of Third-Party Logistics is integral to keeping up. In light of this our beginner’s guide to third-party logistics (3PL) will delve into the essential aspects, offering insights into fulfillment services, warehousing, and much more.

Read More…

With shipping costs rising, it is vital to ensure you are saving as much as possible by avoiding these common and costly shipping mistakes. By steering clear of a few of these mistakes, your company can see a little boost to your bottom line. By double-checking the accuracy of invoices, addresses, dimensions, and weights, your company can save a lot of lost revenue. Even though package damages cannot be avoided altogether, using the right-size packaging limits damage and ensures you are only paying for the shipping, you need.

Falcon Fulfillment can help you reduce shipping costs, improve shipping invoice transparency, and provide the right-size packaging. Learn more and get in touch with one of our agents today.

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