UPS announced changes to its rates for 2019 in December last year – giving customers a mere 3 weeks before they went into effect. With the holidays in full swing, the entire fulfillment industry was extremely busy at that time – so if you missed the announcement or didn't have time to process the details, you’re not alone. To help get you up to speed, we’ve highlighted the some of the most important changes in the list below. For full details and pricing information, visit UPS to read the official announcement.
- The rates for UPS® Ground, UPS Air and International services will increase an average + 4.9% (which follows the precedent set by FedEx's previously announced rate increases for 2019)
- The index for determining the Domestic Air Fuel surcharge increased +0.25% for all thresholds. In addition, fuel surcharges will apply to accessorials such as Additional Handling, Over Maximum Limits, Signature Required and Adult Signature Required.
- A new processing fee (+$2.00 per package) will be charged when Package Level Detail (PLD) is not provided to UPS prior to delivery.
- The Additional Handling charge for all packages will increase by $2.25. Any U.S. domestic package exceeding 70 pounds in actual weight (i.e. not DIM weight) will incur an Additional Handling charge of $4.00.
- The Address Correction charge will increase +$0.50, and the per shipment maximum will increase +$3.50.
- The Large Package Surcharge will increase +$15.00 for U.S. Domestic commercial packages, +$25.00 for U.S. Domestic residential packages, +$15.00 for International packages.
The cost of shipping is a major competitive differentiator in ecommerce. Shoppers will quickly abandon a cart or buy from a competitor if it means they will save money on shipping. To reduce shipping charges for your customers, you'll need to go beyond investing in cheaper dunnage or renegotiating with carriers for better rates. In addition to those strategies, here are some more holistic considerations for improving the cost efficiency and customer-friendliness of your packing and shipping operations.
Evaluate current packing materials and processes
From material and labor costs, to DIM weight optimization and customer experience – you may find there's a lot to "unpack" by doing a comprehensive review of your current approach to packing and shipping. Some useful questions to ask during this process include:
- How do factors such as total weight, dimensional weight, oversize charges, special handling, and the number of packages shipped per order affect your total average shipping expenses?
- What do your customer service and operations reports show about damages from improper packing or packing materials?
- What is the average labor cost on oversized items requiring special labor and materials to pack?
Consider the potential benefits of branding
Stylized packaging helps to create a memorable, positive experience for customers. When done well, customized packaging can improve your brand perception and boost your marketing reach through word-of-mouth and social media. Besides adding your brand messaging to packaging materials, interactive packaging inserts with social media instructions (“follow us at…”), post recommendations (“take a picture and tell us how excited you are to start using this product”), and hashtag suggestions are an inexpensive way to get more ROI from stylized packaging.
Right-sized packaging & kitting
Customizing your packaging to an optimal size and level of protection can save you money on shipping costs over the long-term. Right-sizing the cartons for each order will help get you the best DIM shipping rate every time. Customized dunnage that is lighter and less voluminous dunnage also contributes to getting better shipping rates. Depending on the level of variation in your typical order sizes, the best solution could range from onsite box-making equipment, to custom packaging and kitting services.
More and more companies are trying to change up their merchandizing strategies in preparation for entering new global markets. Beyond translating marketing content correctly into various languages, e-tailers also need to reevaluate information like item specifications and sizing details to align with regional norms and local consumer protection laws. Social standards as well as neighborhood laws are also critical factors to think about with development into new markets. To help ensure that your website and product information is comprehensive, relevant and accessible to foreign audiences, follow these guidelines.
Make updates to product specifications and descriptions
When expanding your reach to global customers, it's critical to localize product information across webpages and promotional content. This includes revamping SKU info with market-appropriate specifications (e.g. converting imperial measurements to metric) and descriptions that properly translate into your target audiences language(s) and/or dialect(s).
Research cultural norms and make changes accordingly
Ecommerce sites that sell to different regions need to consider numerous cultural aspects, such as seasonal trends, societal norms, and holidays. For example, the color purple is associated with aristocracy, royalty, and riches in many parts of the world. However, in Brazil and Thailand, purple is associated with somber occasions and periods of mourning. Your product offerings and item descriptions may need to be customized according to these kinds of nuances.
Guarantee Quality Control and Legal Compliance
Policies concerning labeling, licensing, and merchandising all vary between countries. For example, many regions have different labeling formats and information requirements for ingredients, country of origin, and health warnings. Sellers (especially those with large item catalogs) may require sophisticated product information management systems to assist them with making and tracking changes for regulatory compliance quickly across numerous markets.
While it feels like stories about corporate data breaches are more common than ever nowadays, it’s definitely not a bandwagon you’d want to join. In addition to losing the trust of your customers, there can be substantial costs related to a data breach in the form of security upgrades, legal fees, and more. To help keep your ecommerce company from joining the growing list of hacked businesses, use the following guidelines to tighten up your website security and protect consumer data.
Identify region-specific compliance requirements
Some states and countries have requirements regarding how companies use, save, and store consumer data. It's vital that you know where your business is being conducted and that whether there are regional data security laws that apply to you. Failing to comply with regulations, such as the Securities for Consumer Data Personal Privacy Act in Colorado or the Golden State Consumer Personal Privacy Act of 2018 in California, not only indicates that your company’s data may be vulnerable – you may also be at risk of incurring significant fines or penalties.
Perform a data security risk assessment
Hire a third-party to run a risk analysis on your current data security architecture to identify any vulnerabilities. Then, outline a strategy for prioritizing and patching those vulnerabilities. Remember: hackers commonly look for easy targets and will move on from targets that require more effort to exploit.
Train and educate your employees
One of the biggest vulnerabilities in any kind of data security strategy are the employees. Make certain your data is safe from unintentional employee mistakes through adequate training and by establishing clear protocols for managing data.
So, you've decided to partner with a third-party logistics provider. Compared to trying to juggle 100% of fulfillment duties in-house, you've most likely seen several KPI improvements since contracting outside help. However, do you have a methodology in place to more objectively evaluate your 3PL's performance – and make a case for either renewing that partnership or seeking out a new one? Although every ecommerce business has different goals and priorities, you can use these broad considerations to help determine whether the terms of your current 3PL partnership should be reevaluated:
If your company has grown significantly, it may have reached the point where in-house fulfillment management is finally viable. Or perhaps you may find that your current provider lacks the flexible space and staffing required to handle fluctuations in sales volume or product offerings.
For many e-tailers, fulfillment has become quite complex. You might decide to seek out a new 3PL in order to access strategically located distribution centers, better warehouse technology, or new customization capabilities to improve your fulfillment operations.
If warehouse space, labor, and/or shipping costs are having a disproportionate impact on your bottom line, it may be time to find a 3PL that can reduce your overhead in some or all of these areas.
Ensuring a positive experience for the customer should be your 3PL’s top priority. Inventory issues, inaccurate orders, and delivery delays are signals that you need a 3PL that does a better job of adhering to your expectations for customer service.