How to Keep Postage Fees and Shipping Costs Low as a Small Business

how to lower postage fees reduce shipping costs small business

As brick-and-mortar retailers continue to struggle in the digital world, e-commerce businesses are thriving. Consumers have been loud and clear for the last decade: Shipping matters. A lot.

If your business is going to stay competitive, it has to offer a variety of great shipping options. But even standard shipping can cost any company an arm and leg. That's why you're looking for some simple ways to reduce postage fees and shipping costs.

With a few minor changes, you can trim your current delivery expenses without radically changing your current shipping procedure. Here are six ways to dramatically lower your postage fees.


Utilize Thoughtful Packaging

When you're trying to save money on postage fees and shipping costs, it's easy to turn your attention to the delivery service itself. There's money to be saved there, it's true, and we'll discuss that in a moment. But as the first order of business, you should reevaluate your packaging methods.

Do you supply your own packaging materials? That could be costing you. Custom boxes incur additional fees and surcharges, or higher shipping rates.

That's because your shipping company will factor in its dimensional weight. This is a measurement of the estimated weight given the dimensions of any package. If you're selling a large, lightweight item, you could be spending far more on each delivery than you have to.

The secret is to use packaging supplies from your delivery company. Major delivery services such as FedEx and USPS offer their own flat-rate boxes. So long as your merchandise fits and sits below a certain weight guideline, you'll avoid dimensional weight penalties.

Of course, you may not need to use boxes at all. Do you know if you're making use of the most efficient packaging and delivery methods? You may be able to get away with affordable poly mailer bags or even envelopes, saving a small fortune on postage shipping rates.


Renting a Postage Meter

If your company ships in high volumes, there are many hidden delivery fees. Consider, for example, the employee time used to travel to and from the post office. That also doesn't include all the time spent sorting and organizing the mail piece by piece.

These types of businesses can benefit from renting a postage meter. What is a postage meter? It's an official printing machine that marks your mail with the correct postage.

In addition to saving employee time — and thus, money — your company will also glean unique discounts. You'll be eligible for lower shipping rates and special meter prices. While these are slim savings at an individual level, they can really add up for high-volume companies.

In short, renting a postage meter machine may be one of the easiest ways you can save on postage fees.


Use Regional Delivery Services

Large shipping companies such as FedEx and UPS are more reliable than the little guys and have massive delivery networks. While these are essential boons for any business, they do come at a premium price point.

No matter where your business is located, consider contacting regional delivery services around your area. These companies offer lower prices to compete with the delivery giants. And while they don't always have the same resources, you may discover that a small delivery service is more than enough for your needs.


Limit Shipping Zones

Urban areas located in your country tend to have some of the lowest rates. That's because there are robust, high-volume supply chains that ensure there's always someone available to move your packages. And once they arrive in the city, they often don't need to travel far to arrive at their intended destination.

But rural areas and international deliveries are a larger problem. Not only can delivery costs skyrocket, but the delivery time can become unreliable at best.

To save on postage fees, you have two options. The first is to limit your shipping zones. This may mean you'll have to make the hard decision to cancel international deliveries, which is fairly common for small and medium-sized companies.

However, you can also outsource the shipping to third-party order fulfillment services located in these shipping zones.


Choose Third-Party Insurance

Most major carriers offer insurance plans as part of any shipment. It's certainly convenient to accept these offers since you're already shipping through their services. However, their insurance rates are almost double those that you can find from a third party.

If you're shipping items worth a large fortune, you're likely paying a small one to ensure they arrive in one piece. Shop around for cheaper third-party rates and you stand to save big.


Buy Postage Online

Digital purchases not only save you a trip to the post office, but they're cheaper, too. A variety of vendors are now approved to offer postage over the internet. Many types of postage have more than a 10% discount on online postage compared to buying in-person.

It's as simple as providing some basic information and printing off the postage information yourself. If you're using this online service, you can also schedule a pick-up at no extra cost. It's a no-fuss way for businesses of any size to save big.


Save on Postage Fees

One of the easiest ways to improve your margins is to lower your postage fees. From postage meters to efficient packaging, there is a wealth of options available. By taking advantage of as many as possible, you can cut your current shipping expenses by a third or more.

As a small business owner, you're always looking for ways to save. Find more business budgeting advice across our frugal biz blog.

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