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July 24 2006 11:31 AM

With every new year comes personal resolutions. Spend more time with family and friends, lose weight, invest for retirement and get better organized are all favorites. People who have the desire and commitment to stick to their plans are always rewarded. The same thing holds true in business. Do you have business resolutions for 2004? Probably not. Well, it�s not too late! I�m here to help you out with some suggestions. As always, my suggestions are geared toward reducing shipping expenses with a direct impact on the bottom line. Let�s take a look.
1. Review your use of air/express service to ensure it�s necessary. Low zone �air� parcels never see an airplane. They travel in the same trailer as your ground parcels. Save your company some money. Compare the cost of next day air versus ground and you�ll see the impact.
2. Negotiate a new parcel agreement based upon your unique shipping characteristics. Whatever you do, don�t benchmark incentive rates. Emphasize your average parcel size, weight, zone distribution and parcels per delivery stop.
3. Go ahead and bundle your parcels. Don�t believe the carriers; it is well worth your time! Bundling parcels going to the same consignee will dramatically reduce your total shipping expense.
4. Understand what impact the recent rate increase has on your business. I�ll give you a jump start � don�t believe the carrier press release; it�s not 1.9%. This annual hoax is better than the Sunday funnies. Once you understand the impact, use it as leverage during rate negotiations.
5. File for shipping refunds on all parcels delivered late. If you are unable to do this in-house, then use an outside company. Ignoring this opportunity is just being lazy. And if you �signed it away� for greater incentive, get it back during your next negotiations.
6. While you are getting information on late packages (see # 5), don�t forget to get a handle on address corrections. Institute a program to correct wrong addresses so fees are not paid to the carriers on an ongoing basis.
7. Review your oversized packages, and calculate your annual oversized expenses. Then brainstorm to reconfigure the packaging to eliminate the charge, if possible.
8. Clearly determine and communicate the associated costs for all shipping activity down to package level detail.
9. Ensure your products are properly pack-aged. Improper packaging will result in damaged product or en route repackaging by the carrier.
10. Don�t overpay for inbound transportation. I can count on one hand the number of clients that we�ve had over the years that passed their discounted rates on to their customers. Meet with your carrier to set up an inbound collect billing program. While you�re at it, ask your carrier to provide a new discount program that incorporates your inbound shipments.
Understanding savings opportunities is one of the first steps toward profit improvement. Once you calculate the dollars you can add to your company�s bottom line, I am sure you will be as enthusiastic as I am about business resolutions for 2004. Happy New Year!
Joe Loughran is president of SmartTran, Inc. and an expert in parcel carrier rate analysis. SmartTran is a transportation consulting company offering services in carrier rate negotiation, guarantee refund service and logistics planning for nine years. SmartTran�s management team has over 60 years of experience in parcel transportation management. Joe can be reached by phone at 724-934-0626 or by email at