How to Save Money on Shipping - Part 3: Surcharges and Other Charges

Both UPS and FedEx are very particular about what they ship.  They do this to ensure that shipments are packaged in a way that works within their systems and to ensure as much reliability as possible.  To ensure packages fit their systems, and to cover costs when shipments do not (carriers have two sources of expenses - size and weight), they both assess various surcharges on certain shipments.  These can easily add up to be significant expenses.

Size and Weight

Space is limited with parcel carriers,
so package size is important

Both carriers will assess a surcharge for packages that are too large for their system.  If a package does not fit on their conveyor systems, a surcharge is assessed.  Additionally, their delivery trucks will only accommodate packages up to a certain size.

• Additional Handling (UPS 2014 - $8.95, FedEx 2014 $8.50)
  
  • Any package where the longest side exceeds 60 inches or its second longest side exceeds 30 inches.
  • Any package with an actual weight of more than 70 pounds
  • Each package in a shipment where the average weight per package exceeds 70 pounds and the weight for each package was not specified when the package was manifest (when the label was printed)  
    
• Over Maximum Limits (UPS 2014 - $51.65, FedEx 2014 - $55.00)
• Packages with an actual weight of more than 150
• Packages that exceed 108 inches in length
• Packages that exceed 165 inches in length + girth [(2 x width) + (2 x height)] 
• Large Package Surcharge (UPS 2014 - $56.60, FedEx 2014 - $55.00)
• Applied when Length + Girth [(2 x width) + (2 x height)] exceeds 130 inches
• If the size criteria is met, the package is subject to a minimum billing weight of 90 pounds

Dimensional Weight
Dimensional Weight is when the carrier determines that the size is more important than the weight (i.e. - lightweight, but large boxes).  If the dimensional weight of the package is greater than the physical weight, then the dimensional weight will be applied.  You can only know if dimensional weight applies by entering accurate (rounded up) package dimensions into your shipping system.

Example: a 19" x 13" x 32" 8lb package is billed as a 48lb pkg due to dimensional weight

If the dimensions were not entered when the package was manifest, you would have thought your shipping costs were approx $10.29.  With the dimensional weight applied, the actual shipping cost is $24.08 - more than twice what you may have billed the customer (prices quoted are from UPS Daily Rates shipping to Zone 2).

Packaging

Not fully encased in cardboard

Due to how their conveyor systems work, both carriers require that packages be totally encased in cardboard.  No other material is guaranteed to move safely on these systems, imperiling both that package and others around it.  As a result, a surcharge is applied to packages that do not meet this requirement.

• Additional Handling (UPS 2014 - $8.95, FedEx 2014 - $8.50)
• Any item encased in an outer shipping container made of metal or wood
• Any cylindrical-like item, such as a barrel, drum, pail or tire, that is not fully encased in cardboard.

Address Accuracy
Both carriers offer many online resources to help you ensure the accuracy of your delivery address, but they're only as good as the address you provide.  Make sure you use the correct address.  Pay attention to your invoices and your online tracking to ensure you're aware of any incorrect addresses.  You can then correct them in your system rather than repeatedly incurring these charges.

• Address Correction (UPS 2014 - $12.35, FedEx 2014 - $12.00)
  Both carriers will work to correct the address provided to them, but at a price.  This is assessed per package, not per shipment, so it can add up.  These charges are specifically noted on your invoice.
• Residential Surcharge (variable)
  Both UPS and FedEx have online resources that will determine if your receiver's address is classified as residential or commercial.  Use these resources, and check your invoices, to make sure you're charging your customers the appropriate shipping.  Home based businesses, farms, and apartments can be particularly confusing with this classification.
• Remote Area/Delivery Area Surcharge (variable)
  This generally applies to more rural locations, and affects industries such as agriculture, farm, and oil.  Similar to Residential Surcharges, these will be noted in your invoice.

Complete Data Entry
It is important that you enter in all the applicable information when creating a shipment.  Not doing so can cost you.

• Weight - If you do not enter the weight, the carrier will determine it for you, but you may not have the correct information to charge your customer the proper amount of shipping.  If you over-estimate the weight, the carrier will bill you according to what you entered.  If you under-estimate the weight, they will bill you according to the actual weight (always rounded up).  In order to bill correctly, you need to enter the weight correctly.
• Size - If you do not enter the dimensions of the box, you can still have dimensional weight or other size charges applied.  Each shipment goes through a scanner that determines the size of the box.  Even if you did not enter the dimensions, if your package is large enough to warrant dimensional weight charges, they will be applied.  Enter the dimensions of the box when you manifest your shipment and you'll know if dimensional weight or other size-related charges will apply.  If you do not, you can be losing money on your shipping.

If the nature of your business precludes you from abiding by all of the size, weight and packaging guidelines encouraged by the carriers, contact your UPS or FedEx representative and see if they can help.  Depending upon your shipping volume and your individual situation, they may be able to work out a solution for you.  They may also be able to give you insight on how to get rural or other business addresses that the carrier classifies as residential reclassified as commercial.

For more tips on saving money with your shipping, read the previous two posts, How to Save Money on Shipping - Part 1: Service Levels, and Part 2: Bundling and Shipments.

How to Save Money on Shipping - Part 2: Bundling and Shipments

Weight Matters
Freight and parcel carriers care primarily about two things - weight and size.  What they are generally not concerned with are the number of pieces being shipped.  This is another area where you can create significant savings.

Each item that requires a label qualifies as a "shipment."  Your shipping rates are determined based upon the size and weight of that shipment.  The charts below will illustrate the difference between shipping multiple single packages as individual shipments, or bundled packages as one shipment.  The red bar indicates the price to ship 1-6 boxes, each as an individual shipment (each has its own shipping label).  The green bar indicates the price to ship one bundle of 1-6 boxes as one shipment (only one shipping label is used, and all boxes are bundled together as one).
 

Shipment A - 11" x 14" x 4", 3lb Package(s)	Shipment B - 6" x 10" x 5", 6lb Package(s)
Shipment C - 13" x 16" x 6", 15lb Package(s)	Shipment D - 10" x 14" x 12", 19lb Package(s)

Depending upon the size and weight of each package, the shipment costs differ dramatically.  You'll notice that the per package price increases far more dramatically than does the cost when the same number of packages are bundled together to ship as one.  With Shipment A, a very lightweight package, the cost barely changes between 1 and 6 packages when they are bundled together, but increases significantly when they are processed as individual shipments.  As the packages get heavier, the difference eventually narrows, but is still significant.

As long as the bundle isn't so big that it warrants dimensional weight, oversize, or overweight charges (addressed in Part 3), bundling multiple boxes together as one shipment can be a significant means of saving shipping dollars.

How to Bundle
UPS and FedEx are very specific about how they want you to safely bundle your packages.  There are three ways to accomplish this.

Bundling with Strapping
The image to the right illustrates how the carriers recommend you strap your packages when bundling them.  They suggest two straps in each direction.  They also discourage the strapping from being used as handles.  This can lead to weakened or broken seals which can result in problems in shipping.

The most common material for these purposes is polypropylene strapping.  This material is available in a variety of widths and break strengths.  The strapping can be applied and sealed with manual tools, battery operated hand-held tools, pneumatic tools, or semi-automatic machines.  For more information about selecting the right strapping, visit our post on How to Select the Right Strapping Product.

Bundling with Tape
For those who will bundle infrequently, tape is an easier option than strapping.  It requires no special tools and is easily applied.  Parcel carriers still suggest that the tape be applied in the same pattern as the strapping example above.

While some carton sealing tapes will suffice, it is highly recommended that filament MOPP tape be used.  This tape most often comes in the form of filament or tensilized tapes.  Filament tape is simply a standard tape but with nylon filament threads running the length of the tape to give it added strength when bundling.  Tensilized tape is similar in construction, but the filaments are manufactured in to the tape and not visible, and they run both the width and length of the tape.  As with most tapes, it's important to use the appropriate thickness based upon the weight of the product being bundled.

Bundling with Stretch Wrap

Stretch wrap is similar to tape, but does not have any adhesive quality so it will not leave any residue or mar the boxes.  Bundling stretch wrap comes in widths of 2", 3" and 5".  It also should be applied like the strapping, with the stretch wrap being applied in both directions.  Bundling stretch wrap is probably the easiest to apply of the three methods suggested here.  Stretch wrap strength is measured by gauge, or thickness, with the higher number indicating the thicker wrap, and subsequently that which is applicable for heavier weight bundling operations.  Lightweight bundling applications can use lower gauge wraps.

There are three handle types available with bundling wrap.

• Standard Core - Comes on a 3" core and ships with one plastic plug-in handle per box
• Extended Core - Comes on a 1" extended core so that each roll has its own built-in handle
• QuikWrap - Comes on a 1-3/4" core and a specialized plug-in handle that swivels around its own core

No matter which of these bundling wraps you choose, the actual wrap is the same - only the core and handle are different.  More information on stretch wrap and bundling wrap can be found on our post, How to Select Stretch Wrap.

No matter which method you choose, depending upon your unique needs, bundling your shipping is a clear way to save a potentially significant amount on your shipping.  If you have multiple pieces going to the same destination, this is an option you will want to consider.

If you have any questions about which option may work best for you, or what product will work best, please contact us and we will be happy to help you.

For other ways to save money on shipping, look at How to Save Money on Shipping - Part 1: Service Level and Part 3: Surcharges and Other Charges.

How to Save Money on Shipping - Part 1: Service Levels

Any company that does any business is engaged in some sort of shipping - either sending or receiving, and often both.  Subsequently, shipping is a major expense.  There are many ways to reduce your shipping expenses without dramatically altering the way you do things.  These posts will focus on UPS shipping in particular, but should translate equally to FedEx or any other small package carrier.

Can it get there in this?

Parcel carriers have multiple shipping levels - Ground, 3rd Day, 2nd Day, and Next Day.  Each service level gets progressively more expensive.  One of the easiest ways to reduce your shipping expenses is to know the transit times from you to your customer.  It is a waste of money to send something 2nd Day Air when it gets there in one day via Ground service anyway.  Essentially, you're paying more for it to take longer to get there.

The confusion with this stems from what the carriers will "officially" guarantee.  3rd Day, 2nd Day and Next Day Air are all guaranteed accordingly - 3 days, 2 days or 1 day transit.  Ground, however, is guaranteed in 1-5 business days.  This does not mean your package will take anywhere between one and five business days to get to its destination.  It means that the carrier doesn't know where your shipment originates and where it's going, and therefore can't tell you how long it will take to get there.  A shipment from Atlanta to Jacksonville, for example, is a guaranteed one-day Ground transit, while Atlanta to Denver would be three days, and Atlanta to San Diego would be a five-day transit point.  The only other difference is that Ground shipments are not time guaranteed.  They will get there whenever the consignee/receiver gets their usual delivery, while the air services are guaranteed by a certain time.

Or does it require this?

For example, if you have a 10 lb package that is going from Atlanta to Jacksonville and you need it there the next business day, you have two options (prices quoted are from UPS posted daily rates):

UPS Ground - $9.41
UPS Next Day Air Saver - $49.45

Both of these shipments are equally guaranteed to deliver the next business day.  The only difference is that the Next Day Air shipment is time-guaranteed and the Ground shipment is not, but both are guaranteed to deliver on the same day.

The web sites for both UPS and FedEx will let you determine transit times and freight estimates for any shipment.  Use these, or print the transit-time maps, to know when you need to upgrade the service level and when you can ship Ground.  This alone can save you significantly.

UPS Calculate Time and Cost	UPS Transit Map
FedEx Calculate Time and Cost	FedEx Transit Map

Choosing the appropriate service level and using Ground services where applicable instead of air services will offer significant savings.  Web sites for both UPS and FedEx will help you, and there is no charge for using either.  Choose wisely.  Pay less.

For additional information on how to save money on shipping, look at the next post in this series, How to Save Money on Shipping - Part 2: Bundling and Shipments and Part 3: Surcharges and Other Charges.

UV Protection for Pallets and Product

For businesses who store their product outdoors, it is important to make sure your product is protected from the harmful rays of the sun.  UV rays can harm your product and can deteriorate the effectiveness of the stretch wrap or poly bags surrounding your product as well.  The further south you go, the more important UV protection is, but keep in mind that it's not the heat that does the damage, it's the unseen and unfelt UV rays, that are just as harmful in the winters of Minnesota as they are in the summers of Florida.

UVI and UVA
There are two terms to know when looking at UV protection:

• UVI - Ultra Violet Inhibitor
  This is an additive that is used in the production of stretch wrap or other polyethylene plastics, which delays the oxidation (or deterioration) of film stored outside and not sheltered from the sun.  Without a UVI additive in the film, your stretch wrap will markedly deteriorate over time, lose its stretch and cling, and subsequently lose its effectiveness.  UVI protection is rated to be effective for a certain period of time, ranging from 30 days to a year or more, depending upon the application.  In short, UVI slows down the eventual oxidization of a polyethylene product and subsequently extends the life of the product.
• UVA - Ultra Violet Absorber
  Probably the best common example of a UVA would be the sunscreen you use.   It absorbs the harmful UV rays and keeps them from impacting the poly product or its contents.  A UVA additive to the film will have much the same impact as a UVI, but also serves to prevent colors from fading over time.
• Practical Difference between UVI and UVA
  To extend the life and performance of your poly product, UVI is all you need and is the most common additive for plastic products.  As a result, the remainder of this article will deal only with UVI.  Neither UVI or UVA should be used in contact with agricultural chemicals or pesticides.

UVI/UVA and Color
A common misconception with UVI treated products is that they need to be black.  This is not the case.  Most UVI treated products are, however, black or white or some other color.  Color has no impact on the UVI performance but is usually done for purely aesthetic or security reasons, or simply to differentiate it from standard non-UVI wrap.  Black UVI treated stretch wrap, for example, will prevent people from seeing what is on your pallet.  While color alone can affect the heat that is transferred to your product, it has zero impact on the UVI performance, which is where the real damage can occur.  A stretch wrap treated with a UVI additive is just as effective whether the stretch wrap is black, white, or clear.

UVI Treated Products
As a blog geared toward the industrial setting, we will focus on two primary product types that can be treated with UVI.

• Stretch Wrap
  UVI stretch wrap film is rated for as short as 30 days, and can be longer depending upon environmental variables.  It is often black or white but can be clear and be just as effective as a UVI film.  If almost everything you wrap is stored outside, then UVI treated stretch wrap is a good option. 
• Pallet Covers and Poly Bags
  Pallet covers and poly bags can be UVI/UVA treated and are rated in effectiveness for between 1 year and 3 years.  It should not be used in contact with agricultural chemicals or pesticides.  While it is common to find black UVI/UVA bags in stock as pallet covers, you can have any type bag in almost any size or thickness custom made with UVI/UVA additives.  If you have some products that need UVI protection and some that do no, UVI/UVA treated pallet covers can be a good option.  They will allow you to use your regular stretch wrap, but cover it with a UVI/UVA pallet cover.  They can also be re-used, provided you keep an eye on the cumulative sun exposure the bag is subjected to.  There are many stock UVI/UVA treated pallet covers (in 2mil black and 3mil black) and custom bags can be made in any size.  Samples are also available (standard bags, not UVI rated) so you can make sure you have the correct size.  When determining what size bags you need, use the formula below:

Contact us today for quotes on UVI treated stretch wrap (in any size), pallet covers, and poly bags.  We'll be happy to help you determine what will work best for your needs.