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Freight Forwarding Costs

by Will Schneider

If your business imports goods from overseas to sell in the U.S., then you’ve come across freight forwarding. Simply put, freight forwarding is shipping product overseas, whether that’s importing or exporting. However, as easy as this sounds, international shipping can be extremely complicated. In addition to choosing the correct codes to classify your products, you must also clear your goods through customs.

This is why a lot of companies hire shipping companies in order to take care of all of their freight forwarding needs. But be careful, because not all freight forwarders are created equal. In fact, many of them aren’t completely open with their pricing, which makes comparing price quotes extremely difficult. Some things to keep in mind: always ask the freight forwarding companies to provide you with “all inclusive” pricing and to include services to get the product from the factory to your door.

There are quite a few other things that companies will not include in their pricing, in order to make their pricing look more competitive than others. For example, many freight forwarding companies will provide a quote to get your product from port to port. However, what this doesn’t include are the all important costs of getting your product from the factory to port exit, and then the port of entry to your warehouse. As you can imagine, these can be quite expensive – and if you make a decision without these costs factored in, you’ll no doubt be left speechless when you get your final invoice. I’ve seen numerous cases where companies were shocked with the final costs of freight forwarding once they get their invoice.

And remember, custom fees and custom clearances charges can add up as well, so please make sure that you get an adequate estimate of these charges before selecting a freight forwarder. Of course, you’ll have to know the precise product codes that apply for your goods, but this information will be needed regardless.
As you can see, there is a lot involved with bringing product in and out of different countries. Shipping is such an important part of your business. It really does pay to take a little time to learn more about it, so that you can navigate the shipping negotiations with confidence. Far too often, people are taken advantage because of their lack of knowledge. Our hope is that you’ll learn a little about the industry so that you don’t get taken advantage of.

Outsourcing Pick and Pack

by Will Schneider

Are you considering outsourcing pick and pack with a fulfillment company? This is a very important question that many product-related companies consider. While the answer may seem obvious to some, there isn’t really a clear cut answer in many instances. Here are some of the reasons it can be difficult for people to outsource, as well as some things to consider when making the decision.

First and foremost, it is extremely difficult for many small business owners to outsource anything, as many times they have been responsible for the core functions of the business. Many small business owners do a great job at the core functions of their business, and rightfully think that they can do them better than anything else. However, the hard truth is that we only have a certain number of hours in each day. Especially if a small business is pursuing growth, sharing responsibility is the only way. Whether this is hiring additional staff or outsourcing the pick and pack, getting it off of the plate of the small business owner can be extremely successful. The catch is this – they have to be willing to accept that whoever they give pick and pack responsibilities to will not necessarily do it as well as they did it. No one ever has as much care for a business as the owner. However, owners must realize that they can only do a certain amount of things each day, and if they can get others to perform even at 80-90% of their capability, then the job will be done well.

The other big thing that we see when considering whether or not to outsource pick and pack services is “where” the fulfillment company must be located. Again, going back to the “control” issue, most small business owners wish to have the pick and pack located close to them. They figure that this way they can have more control over the process. While this may be true, the unfortunate reality is that there aren’t necessarily quality, high performing fulfillment companies in all areas of the country. This means that they could compromise by going with a local firm, taking a great risk that they warehousing company doesn’t perform well. But the really good 3pl companies will do a great job, whether or not you’re located next door to them. And believe me, finding a great pick and pack company is worth its’ weight in gold.

Finally, when looking at whether or not to outsource, keep the costs in mind. However, it’s not all about whether or not it’s cheaper to outsource. This is because most small business owners fail to incorporate “opportunity costs” into the equation. Simply put, there is an opportunity cost of continuing to do the fulfillment in house. If you do, you won’t have time to, for example, locate new customers, grow your business, or uncover earth shattering business opportunities. In order to make the best decision, you must include opportunity costs into the equation.

Case Study – Small Business Looking for Fulfillment

by Will Schneider

Sure, large firms can find a fulfillment company that will meet their every need! But what about a small business that only ships a small amount of orders per month? Where should these companies turn in order to find a fulfillment company that will give them the same level of quality and provide high caliber customer service?

The Problem

This is the same question that Chris S. asked himself when looking for a small business fulfillment company. Chris owns a small business that sells cells phone accessories. His business is based in southern California and needed to find a fulfillment company close by so that he could drop in and check on his product from time to time.

“I started looking in the Yellow Pages online and searching for warehousing and fulfillment companies on the search engines. There are so many out there, and I’ve heard of a lot of horror stories. Then I stumbled on WarehousingAndFulfillment.com,” said Chris.

The Solution

Chris turned to WarehousingAndFulfillment.com. He filled out a quote request form in only a couple of minutes, and within an hour he was contacted by fulfillment companies that specialize in small business fulfillment in the area he requested. “It was good to know that the companies were pre-screened,” said Chris. “I spoke with one of the employees from WarehousingAndFulfillment.com and he knew what he was talking about. That made me feel comfortable about the companies they put me into contact with.”

“They did a really good job of connecting me with companies that specialize in small business fulfillment. I chose one of the fulfillment companies and am very pleased with the service I receive. I don’t feel like I’m lost in a 1 million square foot warehouse. I actually get attention!”

Find a small business fulfillment company today that can meet your needs. Fill out a quote request now!

Warehousing and Fulfillment Pricing Tips

by Will Schneider

Looking at a pricing proposal from a warehousing and fulfillment vendor is akin to browsing the statutes of a typical homeowners association. Although it may be a good solution for sleep troubles, reviewing the pricing proposals of warehousing and fulfillment companies should be done with great care and diligence.  Below are some tips to help avoid some of the challenges of warehousing and fulfillment pricing.

  • Make sure that the warehousing and fulfillment vendor has listed ALL costs
  • Beware of monthly minimum charges
  • Ask for volume discounts that are available for higher volume order processing and storage
  • Determine all monthly fixed recurring charges
  • Ask if the handling charges can be rolled into your product costs and make sure that you are comfortable with the resulting net profit
  • Ask if the vendor makes margin on freight
  • Ask for referrals from current customers to make sure that costs don’t change after sign up
  • Check the vendor’s BBB rating
  • Make sure that everything is documented in a contract

Taking a few precautions when looking at warehousing and fulfillment proposals can help in avoiding unncecessary troubles, and can lead to a long-term agreement that works for both sides.

Choosing a Warehousing and Fulfillment Partner

by Will Schneider

Choosing a warehousing and fulfillment partner can be an overwhelming experience.  Oftentimes, it is the last thing that a company considers before launching a product.  But making this decision doesn’t have to be difficult.  And with a little thought during the planning stages, companies can make the best decision for all of their warehousing and fulfillment needs.

Analyze Your Needs

In order to make the most informed decision, a company must have a thorough understanding of its warehousing and fulfillment needs. One critical factor to consider is the geographic needs of your business. Is it important that your warehousing or fulfillment partner is located close by?  Will you be shipping all throughout the country or world? Where is your manufacturer located and how does that relate to your geographic requirements?

Second, a company must explore its needs related to technology. Do you have a web store in place currently? If not, what are your technology needs? Web stores range from very basic (with low monthly costs) to complicated and highly customizable (with larger up front costs). Furthermore, the reports that accompany your web store are vital to making the most informed decisions. Does the web store offer real-time reporting? Finally, if you already have a web store, does the warehousing and fulfillment company have an interface to download orders, send out tracking information and offer inventory reports?

Third, warehousing and fulfillment companies usually specialize in certain types of projects. For example, some companies are quite proficient at e-commerce fulfillment, while others focus on B2B projects. Finding out what types of verticals potential warehousing and fulfillment providers specialize in will assist you in selecting one that best suites your needs.

Compare Warehousing and Fulfillment Companies

Taking the time to search for a quality warehousing and fulfillment company is an important step in the process. WarehousingandFulfillment.com makes it easy. Simply fill out a quote request form and receive up to 5 responses from quality warehousing and fulfillment vendors.

Of course, knowing what to look for will ensure a successful choice. Use the tips below to make the best decision on a warehousing and fulfillment vendor.

  • Obtain a list of all warehousing and fulfillment charges
  • Determine how many customers the warehousing and fulfillment company has
  • Ask how many locations are under management and where they are located
  • Ask for references from existing customers
  • Check the vendor’s BBB rating
  • Obtain a tour of the facilities
  • Obtain a demo of all technology systems and reports
  • Ask for an understanding of the processes and procedures of the vendor
  • Ask for historical error rates of the warehousing and fulfillment company
  • Gain an understanding of the customer service support mechanisms of the vendor

Make the Best Decision

By taking the time to understand your needs and the capabilities of each warehousing and fulfillment prospect, you will be able to make the most informed decision. Remember, the back end storage and distribution of your product is an important part of your business that deserves adequate time and consideration.