Every time the USPS announces rate changes, all the stakeholders come out of the woodwork, with many of them bemoaning the increases and how it will impact their operations. Relax! Take a deep breath. All told, this rate change will have minimal impact to most; favorable impact to some; and not so favorable, but tolerable, changes for others. 

The positive outcome is that it motivates shippers to evaluate their processes and take action on the many strategies available to lower their costs on small parcel logistics. 

Here are five tips you can use to reduce your parcel expenses:

1. Modal Optimization: Restructuring business rules to route packages by cost of transit and service times.
2. Reduce air space when possible to take advantage of Flat Rate, Regional Flat Rate and Cubic Priority Mail offerings. “If it fits, it ships.”
3. Work with a parcel consolidator program that has special NSA pricing that:
• allows you to participate in Cubic pricing tiers.
• provides an extra $50 in free insurance. “CPP” and “NSA” customers receive $100 per package while “Base” customers get $50. 
• has no annual commitment – avoids the worry of paying the difference, a very real concern!
• allows you to ship 14-, 15- and 16-ounce packages at the “Plus” tier for First Class Package Services. Without “Plus” pricing, packages over 13 ounces must go at the more expensive Priority Mail rate.

4. Enable the customer to make a shipping cost decision based upon time of transit, not specific Carrier Service mode. Use a carrier management system to determine the lowest cost based upon dimensions and weight/zone that includes your negotiated rates with (FedEx and UPS) ancillary costs considered.

5. Consider working with a third-party organization to help you both modally optimize and negotiate best in class carrier contracts, while right sizing the “Earned Discount (Portfolio) Incentive Tiers” to reflect the modally moved volume to lower cost carriers.