Getting products to customers may not be the first priority for a small business, but is a key function that can be managed effectively if you understand the available options.
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For a lot of small businesses, getting products to customers is almost an afterthought. After all, there are so many other priorities to deal with first. Product development, intellectual property, manufacturing costs and pricing, marketing, packaging, and sales channels to name just a few.
When it comes time to decide how to ship your products, the choice is usually defined by its dimensions and weight. If it’s a relatively small, lightweight item sold via e-commerce, you have readily available common carrier options like UPS, FedEx, and the U.S. Postal Service.
Each shipping carrier offers different priority options and sometimes the complexity of choices can be daunting, but there are some general guidelines that may be helpful.
UPS is generally more expensive, but is better for parcels over two pounds requiring worldwide reach. UPS also offers guaranteed express shipping if day-definite delivery is important. However, UPS does tack on fuel surcharge fees, which can get expensive.
The USPS is the best choice for small lightweight packages, delivering directly to mailboxes and post office boxes nationwide. You get free pickup and free Saturday delivery and may qualify for special flat rate shipments. USPS has also improved its reliability and tracking in recent years.
FedEx offers air shipments and next-day deliveries, and Saturday delivery is available at no extra charge with FedEx Home Delivery. FedEx provides excellent tracking and pricing across a number of shipping options, and if you set up a business account you can apply for discounted shipping rates.
Freight options
If you are sending out product packages larger than a parcel, you’ll want to find a transportation company that handles freight.
For smaller businesses, that’s usually a less-than-truckload carrier that can accommodate items that don’t fill the entire truck. LTL carriers pick up and move multiple loads from different businesses, to take advantage of freight density on the same route.
With each of the shipping methods described above, there are several factors to consider, and one of the most important is whether you want to manage all these carriers and decisions yourself or outsource that function to a professional fulfillment company or freight forwarder. A fulfillment and logistics provider can calculate the best costs, manage inventory and packaging, and arrange for pick-up and delivery.
This usually entails a strategic mix of carriers to ensure the best overall distribution and delivery costs.
‘Final mile’ and ‘white glove’ services
If large or bulky household and garden items are involved requiring residential delivery, it’s called “final mile” freight, because it represents the last mile in the supply chain to the end-user.
The term “white glove” delivery refers to carriers that set up the customer’s purchase in-house and remove all the trash and shipping materials, providing a truly turn-key experience.
In the early stages of product development and brand awareness, many entrepreneurs take on the responsibility and even the physical work of packing and shipping products themselves. As businesses grow, they may choose to hire a logistics and transportation manager or to completely outsource those functions.
The benefits of outsourcing to a professional fulfillment and logistics company include saving time, labor, and shipping costs by taking advantage of volume discounts and economies of scale not available to individual small businesses.
There are pros and cons to this approach. Every business owner must decide when they’ve reached the tipping point between packing and shipping products themselves, and the downside of not having the time needed to lead and manage their company.
Todd Flaherty is executive vice president and partner at ShipRight in South Portland. He can be reached at tflaherty@shipright.biz.
