June 4, 2008, 12:00 AM

Getting a handle on changes in parcel shipping

Shipping rates routinely rise every year about 3 to 4%, but just because it’s an annual routine doesn’t make it easy for retailers, says Jeff Carter, vice president of fulfillment at Backcountry.com, who will address parcel shipping issues at IRCE 2008.

Shipping rates routinely rise every year about 3 to 4%, but just because it’s an annual routine doesn’t make it easy for retailers, says Jeff Carter, vice president of fulfillment at Backcountry.com, who will address parcel shipping issues at IRCE 2008.

Retailers typically get a grid every January showing how new rates apply to different products, weights, dimensions and shipping destinations, Carter notes.

This year, however, things are even more challenging because of shipping surcharges related to higher fuel prices, he says. In addition, carriers often change other surcharges related to destinations outside of normal delivery areas.

The result is that direct-to-consumer retailers must work even harder to track all the new fees from carriers, compare them to expected sales and profit margins, then decide whether to add increases to the shipping fees charged to customers. “A lot of times retailers don’t dig into all the charges from shipping companies and balance the shipping costs against product profit margins,” he says.

In the session, “Changes in the parcel industry and how they affect e-retailers,” Carter will address several steps retailers can take, from knowing when to negotiate for better rates, using software to better manage deliveries and shipping rates, and deploying a system of randomly checking shipping records to ensure that shipping companies are meeting their promised delivery times.

Backcountry.com is part of QVC Inc./Liberty Interactive Group, No. 11 in the Internet Retailer Top 500 Guide.

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