Delivery prices (uk) any experts?

[shmit88]

Hi,

I'm looking for some advice from anyone who has experience with sending a high volume of parcels around the UK. (1000+ a year)

I'm currently carrying out some research for a business idea. (see thread copying-duplicating-another-business-concept).

This business requires a high volume of parcels (average 500g) to be sent to customers, so I need to be able to keep costs down as much as possible, but this seems impossible with shipping costs. It currently costs £2.80 for a small parcel weighing 110g, to be sent 2nd class by the Royal Mail, which is simply too much.

I have tried to contact Royal Mail regarding a business sending over 1000+ parcels a year, but they won't speak prices with me as I am not a business account holder and must apply for one beforehand.

Would anyone be able to provide me any advice as to who are the best shipping companies for this (in your experience). The business will simply not work with shipping costs as high as £2.80.

Regards,

Calum

 

[JamieM]

You could probably get 2nd class down to about £2 with an account. What size would the parcels be?

 

[JamesSco]

As @JamieM has stated, you will be able to to bring the parcel cost down to £1.98 by opening up an Online Business Account (OBA) with Royal Mail. However, you will need to be sure that you will send at least 1,000 items per year with them as this is there minimum requirement for this service.

This service will allow you to send any parcels up to 46 x 46 x 61cm (W x H L). Anything bigger than this will need to be sent by a courier (Royal Mail are now strictly enforcing these size limit). This allows up to an average weight of 1000g

Its extremely important to note that the £1.98 price will attract VAT as well as a fuel surcharge of 2.5%. So this price will be £2.4354 per package if you are not VAT registered or £2.0295 if you are VAT registered.

However, with this service you are offered further discounts based on the amount you send. If you send out 20-99 packages in one day you will receive a 4% discount, between 100-249 you will receive a 6% discount. There are further discounts for larger quantities, let me know if you need any more info on these.

Looking to the future, if you are looking to expand you can move onto Royal Mail Packet Sort which offers further discounts and can bring the price down to £1.92. But you need to send at least 250 items a day to use this service. There are further discounts available on this service, you will receive a 9% discount if you send between 250 - 749, a 12.5% discount if you send between 750 - 1999. We hold onto our packets and send these every second day to achieve the 12.5% discount which brings our shipping costs per packet down to £1.68.

Its extremely unlikely that you are going to get offered any better prices by any courier companies for your items giving how light and small they are and due to low volumes.

 

[Tony King]

Check out MetaPack - they are a supplier of software linked into all the large parcel carriers - you simply enter the delivery details and they find the most cost effective deal and print the label and order the pick up - SIMPLES!

 

[shmit88]

Thanks for the replies and advice guys.

1000 parcels a year shouldn't be a problem if all goes to plan, could possibly be 3000 or more.

Have taken a look at the MetaPack website and sent an enquiry.

I was given some good information yesterday. I was told that I should attempt to find someone local who sends a large volume of parcels and make a deal to team up with them and use their shipping platform, that way the rates will be lower, so may also look into this.

 

[Moneyman]

I would give a fulfilment house a call. they get really cheap parcel rates and do all the shipping for you. it would certainly be easier than doing it all yourself once you factor in someone to do the work and the cost of having a store. i could plug one of my businesses that do this but i wont.

 

[shmit88]

Hi Moneyman,

A fulfillment house would be perfect, except due to the product I am looking to provide, it wouldn't be something they could ship for me, unless of course there are fulfillment houses out there that are capable of provide extra services before shipping products, i.e. inspecting and cleaning the products?

Perhaps I will enquire and could possibly make a deal if/when the business launches.

 

[japancool]

I should point out that 1000 parcels a year is not a large volume. That's only around 20 a week, and a lot of parcel carriers won't even talk to you about a business account unless you're sending out 100+ a week.

If your business can't sustain a postage cost of £2.80 per package, and you're only sending out 20 a week, is it really viable?

 

[Tony King]

We offer pre -retail services and fulfillment services - we already cater for several sme - picking and packing - and also have experience in assembling mobile phone packages and distributing all over the UK. PM me if you would like to discuss.

 

[shmit88]

1000 parcels a year is just a 'safe' estimate. My business idea could potentially need to send 18000 a year (going off the figures that an american company had) but as this idea has not made it to the UK yet, I cannot make an exact estimation and therefore I feel 1000 is the safe estimate (I'd rather under compensate on this kind of thing).

 

[Tony King]

1000 parcels a year is just a 'safe' estimate. My business idea could potentially need to send 18000 a year (going off the figures that an american company had) but as this idea has not made it to the UK yet, I cannot make an exact estimation and therefore I feel 1000 is the safe estimate (I'd rather under compensate on this kind of thing).

Well at that level (conservative) or the higher level - we would be happy to discuss your requirements.

 

[RedOnion]

We would be able to inspect and clean items before being sent out. We aim to provide the service that the customer wants, so happy to carry out any extras on top of normal fulfilment.

PM me if you would like further details.

Tracy

 

[Richard Tucker]

Do check out Route Genie, a credible alternative Carrier Management Software, offers real value for money, developed and proven from a retail logistics perspective providing 360° control and visibility over all aspects of carriage, resulting in lower costs within the supply chain and the flexibility to respond quickly to changes in customer demand within a multi-carrier environment, all the while enabling you to deliver on your customer promise.

Route Genie is an advanced carrier routing software, the robustness that comes from routing millions of parcels a year for clients like Dunelm, Waitrose Cellar, Paperchase, Cath Kidston and Fortnum & Mason, it has been independently volume tested with 20 times its forecasted annual volumes and has passed all tests with flying colours. Route Genie delivers a credible alternative:

• Route Genie gives you outstanding Reality Time Dashboard service level visibility reporting of carrier performance
• Route Genie is designed and implemented from a logistics retailer’s point of view
• Route Genie offers 24/7 Customer Support as standard
• Route Genie offers real value for money and flexibility, not just per label pricing
• Route Genie provides real operational efficiencies and customer experience.
• Route Genie is a Software Solution that is Agile, Easy Intuitive and quick to change and update

 

[japancool]

Would you mind repeating that in English, rather than in marketing babble?