#parcelspendintelligence

Capture Big Savings on Parcel Spend Management

This is the golden era for the e-commerce industry and fast and free shipping as both customer expectations and demand are growing exponentially. However, many businesses are facing difficulty dealing with parcel shipping. Carriers across the globe are running at full capacity, and shipping costs are unparalleled. That’s why it's crucial for businesses to find parcel spend management to optimize their parcel spend. 

What Is Parcel Spend Management? 

Parcel spend refers to the transportation cost associated with parcel carriers. That includes parcel weight, distance, and service level. Parcel spend management is using technology to analyze your parcel data and manage your parcel spend costs. 

There are also several additional fees squeezed into your parcel contract that could affect your shipment invoice unexpectedly. 

When it comes to parcel contract management, the goal is to select the most cost-effective and optimized carriers so that you won't leave money on the table. It's all about having the just right partner, strategy, and technology.  

Conventional parcel delivery business models have revolved around service level and pricing capabilities usually catered by USPS, DHL, FedEx, or UPS. But not around the constantly changing needs of the shippers who purchase and use these services to meet their customer demands. 

As a business entity, you need to keep your eye on the pricing ball: 

Many of these parcel providers are asset-based, have stakeholders to report to, and government regulations to follow. That’s why they add extra fees and rates in order to meet their sales targets. Now, this is the kind of money you can save and use somewhere else. 

This pricing puzzle gets more complicated by excessively complex matrices like third-party billing fees, shifts in the dimensional pricing index, oversized and unauthorized packages, frequent changes to fuel charges, handling charges, etc. 

Almost every parcel carrier makes changes to their individual tariffs, which can make a sizable difference in your parcel spend, parcel shipping, and parcel cost management which eventually hamper your bottom line. 

Pricing ambiguity and constant pricing changes can specifically impact growing businesses that struggle to thrive in the market and compete with the big players. Considering all the above factors, you need a proper tool with adequate amounts of technological backup to full fill all your parcel spend needs. 

Where Does Parcel Spend Management Add Value? 

It identifies each business's distinctive characteristic, which parcel service providers use to build their cost-to-bill model. 

It identifies key driving points in parcel service provider's profitability metrics, including pick and drop cost, line haul, air feed, and total cost per stop. 

It builds a business model that factors in package cost and clearly defines a comprehensive strategy around technology, pick-up and delivery densities, freight rates, dimensional weight factor, seasonality, fuel surcharges, and service level demand from your customers. 

So how can you harness these constantly growing changes, to take control of your parcel spend, avoid getting stuck into overly charged costs and inefficient practices, and achieve advanced service levels and retail customers? Find a parcel spend management service. 

But you shouldn’t settle for any parcel spend management. After all, any service provider can offer you with a total savings of 4-5% on average. 

But at TransImpact, we have not only the expertise but the technology to find 15-20% hidden savings on your parcel shipping agreement.