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Articles & Tips

How Can I Boost My Chances of Parcel Contract Negotiation Success?

3/15/2021

 
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With UPS and FedEx announcing a General Rate Increase (GRI) for 2021, it may be time for your business to consider entering into a new parcel contract negotiation to determine the best possible shipping rates. Unfortunately, your parcel shipping contract may not be as cost-effective as it could be: it is estimated that over $2 billion in credits and refunds go unclaimed every year by businesses in the United States.

The best way to ensure you are receiving the best available shipping rates for parcel contract optimization is to be informed of all the options available to you and your business. Below are some items to bring to the table for negotiation support when you are looking to settle the best possible parcel shipping contract.

Parcel Contract Auditing
Parcel Contact Auditing is a great way to analyze your shipping contract before a parcel contract negotiation. Audits are in-depth reports that have the potential to save you big money on shipping costs. These audits, when performed by experts, can determine whether or not your shipping company is charging the correct rates, your eligibility for a guaranteed service refund (GSR) or GSR waiver, potential billing inconsistencies, and recovery of funds for items lost during shipping. A line-by-line analysis of your shipping contract by an expert is the best way to gather important information before a parcel contract negotiation.

Negotiation Support Through RFI and RFP
It is essential to have as much information as possible during a parcel contract negotiation. This is where a third-party pricing expert may be useful in offering negotiation support. Using a request for general information (RFI) or a request for proposal (RFP), a third party may be able to assist you in developing a strategy for information gathering.

For example, an RFI can be useful because it presents facts and essential information from a shipping carrier such as basic products, services, costs, and approaches to the marketplace. An RFP can also be an important asset to a parcel contract negotiation because it is more specific than an RFI and may rely on the carrier to provide alternative solutions to your company and its shipping needs.

Parcel Contract Benchmarking
Benchmarking studies can also be an important asset when negotiating a parcel shipping contract. A detailed benchmarking study can be undertaken by a third party to determine if any savings opportunities are available to you. Benchmark analyses can also be beneficial in other ways as they can also identify whether or not you are eligible for certain discounts on your shipping rates, and also compare your shipping costs to other similar businesses in the marketplace. A detailed benchmarking study completed by a third party expert is an essential tool to your parcel contract negotiation because it contains valuable, in-depth information that can ensure you receive the best shipping rates when negotiating your parcel shipping contract.

When entering into parcel contract negotiation, it is important to be in possession of as much information as possible. A third-party expert can help you and your business perform analyses such as benchmarking studies and parcel contract auditing that give you a better understanding of your current contract—and how it can be improved.

Additionally, an RFI and an RPF can be useful ways to gather information from the carrier themselves such as how they operate, what they offer, and what they can do for your business. Information is the best tool for a successful parcel contract negotiation, make sure your business is armed with the most informed and detailed material available to ensure you are guaranteed the best shipping rates possible.

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