Cut Parcel Insurance Cost in Half

Taylor’s Tip #9, “Don’t buy parcel insurance from your carrier; save 50% with third party insurance.”

UPS, FedEx, and DHL all offer various forms of insurance if your package is lost or damaged. With these carriers a shipment is automatically protected up to $100 for loss or damage, but if you require more protection than you need to declare a higher value for protection. FedEx and UPS call it “Declared Value”. DHL calls theirs “Shipment Value Protection. The US Post Office offers insurance as well.

The formula works pretty much the same even though the rates are different if you have a retail or commercial account.
For example, UPS charges $0.90 for each $100.00 (or portion of $100.00) of the total value declared, with a minimum charge of $1.80. If you had a package that was worth $500, you would subtract the $100 that is included and have $400 or 4 units x $0.90 for a cost of $3.60.

If you did 10 packages a month, you would be paying $36 just for insurance!

Now here is a secret that many eBay sellers and online merchants don’t know. There are third party insurance companies that will insure your packages for 50% less than the carriers charge.

I had the opportunity to video Walt Moscoso, Director of Sales for U-PIC Insurance services at the National Conference on Operations and Fulfillment.

U-PIC offers discounted package insurance for packages shipped via major carriers such as UPS, U.S. Postal Service, FedEx, DHL, etc. The package is shipped by the carrier but insured by U-PIC, saving you hundreds, perhaps thousands of dollars every year. You will save 60-80% on your insurance costs. There are no minimum requirements.

If You Only Use 1 Parcel Carrier, You Are Leaving Money on the Table

At the National Conference on Operations and Fulfillment, in as session entitled, “Parcel Carriers Deliver”, moderator Jerry Hempstead asked executives from UPS, FedEx, DHL, United States Post Office, and Eastern Connection,

“What is the biggest mistake parcel shippers are making?”

Jim Cochrane, Vice President of the US Postal Service, responded, “If you only use one carrier, you are leaving money on the table.”

The message was clear. Shippers need to consider all their options.

Dave Loonam, Vice President of DHL Global Mail, answered, “Know where your packages are going and don’t pay for a service you don’t need.”

Keith Kellison, Corporate Strategy Manager of UPS, suggested when it comes to choosing shipping options that it is important for shippers to “Pick the right product.” He shared that some shippers tend to swing from making it a policy to ship everything ground to save money to shipping air to satisfy customers. His advice is to “find the optimal solution.”

Steve Noble,  Manager of Domestic Product Marketing for FedEx, suggested that shippers “take advantage of the full portfolio that carriers offer. He informed the audience that we are more mobile, “Customers want delivery options, evening deliveries, weekend deliveries, date and time specific appointments.”

Jack Mitchell, Vice President of Eastern Connection, a regional carrier in the Northeast, recommended that “shippers get everyone in the company involved in shipping the right way.” He was speaking about how companies create a policy of shipping in a specific way that will save the company on shipping costs but everyone in the company doesn’t follow the policy.

Most shippers are making mistakes and as a result are overpaying. I had the opportunity to video several of these executives.

Stay tuned; I will be posting their advice in upcoming blogs.

You Don’t Need To Be a Large Parcel Shipper to Benefit from This Shipping Advice

An article in Operations & Fulfillment advises its readers not to put all their eggs in one basket. “Experts advise large shippers to invest in “multi-carrier parcel manifesting systems”. What does that mean? In layman’s terms, it means that you should use more than one package carrier.

Most small businesses pay 50% more than larger shippers because they don’t compare rates among multiple carriers. It is like flying with just one airline; no single airline is the best airline for flying to different locations. In package shipping, it is no different.

Taylor’s Tip #2: “Compare different services from various carriers.”

If you only ship a few packages a week, you may think that this advice does not apply to you but no single carrier will be the best carrier for all of your needs.

If you live in an area that offers regional carriers, you should check them out. Sometimes regional carriers can offer more options at a significant savings. If you don’t have a regional carrier in your neck of the woods, at a minimum, you should compare the cost of shipping your package between the U S Post Office and at least one national carrier, like FedEx, DHL, or UPS.

This simple method of comparing rates between multiple package carriers will insure that you are not wasting money on shipping.