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USPS Cuts Back, Creates Longer First Class Mail Delivery Times

There are countless theories on why the USPS is in financial crisis. But regardless of the underlying reasons for the USPS’ troubles, the postal service has been making a lot of headlines as of late for rate increases and plant reorganization that will affect both businesses and consumers alike.

Last Monday, Dec. 5, the US Postal Service filed its proposals with US regulators seeking to adjust key service standards as it cuts the size of its mail processing network by more than a half. The change will affect First Class Mail, as the service will now change from a one-to-three-day service to a two-to-three-day service for the continental United States. The change in USPS First Class mail time will have far-reaching implications for businesses in every sector. Continue reading “USPS Cuts Back, Creates Longer First Class Mail Delivery Times” »

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Circumventing Dimensional Factors to Reduce Shipping Costs

Last week, we discussed annual shipping cost increases and provided some useful tips on packaging optimization and how to work with your fulfillment house in order to effectively manage the higher costs. This week, we wanted to continue the topic about yearly contract negotiation to focus on the importance of the dimensional factor that is being applied to your shipments.

Last month, Aaron Samuels, Executive Team Analyst for Bridget Solutions Inc., penned an article on the implications of dimensional factors on shipping costs – “While negotiating contracts with your carriers, it’s not enough to focus on just the price that you’re paying on a rate sheet,” said Samuels, “you also need to pay close attention to the dimensional factor that is being applied to your shipments.” The dimensional factor, or DIM, is a number your carrier uses to assess the effective weight of a shipment based on its density, and it can be adding more to your total cost than you may realize. Basically, the dimensional factor is the amount of space the package takes up per pound. If this weight is heavier than the actual weight of the package, your carrier will charge you according to the higher weight. To make this concept a little easier to grasp, we’ll pretend we’re shipping 10 pounds each of bricks and feathers. Ten pounds of bricks can easily fit into a 10x10x10 box, making the volume of that box 1,000 cubic inches. If you divide the cubic inches  bya the 2011 domestic dimensional factor of 166 – – your dimensional weight is about 6 pounds. Because this is lower than the actual weight of the package, your charge would be rounded up to the 10-pound rate.

Now, consider you’re shipping 10 pounds of feathers. This would require a much larger box, say, 15x15x15 inches. If the dimensional factor remains the same, and your volume is 3,375 cubic inches, the dimensional weight would then be 21 pounds. Although you’re shipping the same actual weight in feathers as you are bricks, you would  be charged at the higher 20-pound rate due to the dimensions of the package.

The reason carriers use dimensional factors is obvious. Each truck has a fixed amount of space, and therefore can only fit so many packages per run. In order to protect their profitability, carriers have to charge a higher price for a large box of feathers than a small box of bricks, regardless of the fact that their weight is the same. Although  the standard dimensional factors  are determined by the carriers each year, it is possible to negotiate a better rate. This is particularly true if your company ships a significant amount of packages that are frequently being assessed at a dimensional factor. While you can utilize packaging optimization to reduce dimensional factor-related costs, one of the best possible options you have is to hire a 3PL company to help you analyze your unique shipping characteristics and/or to consult you regarding contract negotiations.

Contact your fulfillment house today for expert advice on how to re-negotiate your annual contract with respect to dimensional factors. A2B Fulfillment offers order fulfillment services, direct response fulfillment, warehousing, value added services and shipping solutions in Canada and the US. For more information, call 866.843.3827 today.

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Strategies for Adapting to Annual Shipping Cost Increases

Death, taxes and annual shipping cost increases. Every January, most of the package carriers increase shipping prices.  For 2012, DHL has already announced their increase.  And it won’t be long before other carriers follow suit. This past January, UPS and FedEx announced average increases of 4.9 percent, and USPS wasn’t far behind at 3.6 percent. “These percentage increases can be misleading because they represent carriers’ average increases,” said Ayal Latz, “Specific rate changes by service, zone and weight and package size vary wildly as carriers respond to market demand, target market share goals and attempt to neutralize the very moves that our industry has enacted to lower shipping costs.” So what can you do as a shipper? Continue reading “Strategies for Adapting to Annual Shipping Cost Increases” »

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Packaging Optimization: How to Save Money with Drop Shipping

Direct Response marketers can save money on shipping costs by learning lessons developed by package consolidators.  Consolidators combine many packages into one larger unit.  This one heavier item ships at a lower cost per pound than the many lighter packages.  Upon arrival at a hub, the larger package is broken down into the components for final delivery. Continue reading “Packaging Optimization: How to Save Money with Drop Shipping” »

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Major E-Retailers Opening Fulfillment Centers in Canada

Canada is our friendly, like-minded neighbor to the north with a considerable collective buying power that seems to be getting more and more attention from big business. Major U.S. retailers, both storefront and online, have recently begun to acknowledge and respond to Canadian consumers by opening fulfillment centers in the country. Continue reading “Major E-Retailers Opening Fulfillment Centers in Canada” »

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a2b Fulfillment Draws Record Crowds at 2011 D2C Convention

A2b just returned from a busy and exciting few days at the Electronic Retailing Association’s 21st annual D2C Convention in Las Vegas. The convention is the one show for the direct-to-consumer industry, and features “top notch, industry-focused education sessions; outstanding networking opportunities including the Opening Reception; and special events including the newly named ERA Moxie Awards Gala” says the ERA website.

The ERA D2C Convention is a must-attend event for all companies within the industry, and this year, a2b  made a big splash. Having been in the direct-to-consumer industry for 6 years, owner Ayal Latz was delighted to receive record foot traffic at this year’s event. Excited customers lined up to learn more about a2b’s exciting new products, unveiled live for the first time. Continue reading “a2b Fulfillment Draws Record Crowds at 2011 D2C Convention” »

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Reverse Logistics 101: Translating Complex to Comprehensible

“Reverse logistics” – what exactly is that?   Many readers don’t understand what it means or its implications for businesses. And you’re not alone – many attempts have been made  to define reverse logistics, but the explanation often makes the concept even harder to understand. Logistics is defined by The Council of Logistics Management as: The process of planning, implementing, and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements. Whew! That was a mouthful. Reverse logistics essentially encompasses all of the aforementioned activities as they operate in reverse.

We’ll try to explain reverse logistics in the most universally relatable way possible. The ultimate goal of reverse logistics is to capture value by making the flow and storage of goods from their point of consumption to their point of origin more efficient and cost-effective. This can mean reusing containers, recycling packaging materials and even redesigning packaging to use less material. Considering that we’re discussing reverse logistics, only those activities that involve sending goods or materials “backward” apply. This can include restocking, seasonal inventory, recalls, processing returned, damaged merchandise, excess inventory and more. It can also include recycling programs, asset recovery, obsolete equipment disposition and hazardous material programs.

As you have likely inferred, reverse logistics helps to lessen the impact that the flow and storage of goods has on the environment. While traditional logistics is focused primarily on making these processes more efficient from start to finish, reverse logistics inherently emphasizes a focus on sustainability. We will discuss this aspect of reverse logistics in the coming weeks. Continue reading “Reverse Logistics 101: Translating Complex to Comprehensible” »

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How to Save Time & Money with Your 3PL

It goes without saying that financial times are tough for just about every business in the current economic landscape. Managers are facing difficult decisions concerning where to cut spending while still maintaining the same level of quality and service. Outsourcing to a third-party logistics company can be a viable solution to save valuable time and money. Continue reading “How to Save Time & Money with Your 3PL” »

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Fulfillment in Canada – a2b’s Newest Endeavor

Consumer-direct campaigns have always eyed the 33,000,000 Canadian market.  But fulfilling orders from a US-based fulfillment center to a Canadian consumer is not an easy task.  Transit times are long, tracking is poor and each package must pass through customs.  In many cases, the Canadian consumer must pay duties to the delivering carrier upon receipt of the item, which is not consumer friendly and results in a high percentage of packages being refused.

With all of these barriers and delays, Canadian consumers are discouraged from ordering from US merchants.  Also, as the time between ordering and delivery grows, the campaign experiences higher customer service costs and cancellations.  Continuity programs are hit especially hard as the cycle is extended.

a2b Fulfillment’s Canadian program solves these problems.   By positioning product in our Toronto-area warehouse, packages ship same-day and deliver as quickly as the following day.  Tracking is strong and accountable.  Best of all, delivery is duty free as they are collected in advance at the time of sale (just like state sales tax).

By working with a2b, marketers receive the same efficiency in Canada as a2b is famous for in the US.  All activity on both sides of the border is managed in the same system and through one point-of-contact.  Send us one order file and we will do all the work.  Easy.

Contact a2b Fulfillment today to learn more about how we can help you expand your market into Canada with little effort. We aim to be a top third-party logistics provider for fulfillment in Canada.

Call us Toll Free 866-843-3827 for further information and a customer service representative will be happy to assist you.

 

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USPS Adds Hefty Returns Pricing

It’s the inevitable – a data entry error, a customer gives the incorrect address, or the receiver refuses the shipment, thus sending your perfectly packed order right back to your door.

However, if you’re using the United States Postal Service, you’re not only getting the package back but a hefty bill to go with it. Continue reading “USPS Adds Hefty Returns Pricing” »

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