Avoiding Common Shipping Errors

Shipping is vital to any business, and it not only is about sending packages, but also reflects the company's commitment which in turn is key to customer satisfaction.

Mistakes during shipping process are common, but avoiding these mistakes can put you a notch ahead for your customer. Usually, these mistakes can cost you minimal to sometimes high penalties by your carriers (e.g. correcting shipping address, dimensional weight of the package, etc.),  but, when these errors occur frequently, it can all add up quickly and affect your company's bottom line.

These mistakes and errors are easily avoidable, if they are identified in time, and with this article, our goal is to highlight the most common errors which businesses make during their shipping process. This will help your organization save on time and money, and like the legends said: a penny saved is a penny earned.

Here are the most common errors which we've seen with most companies involved in shipping products.

• Incorrect Shipping Address

Whether you use an ERP or a standalone system to process your shipments, customer data is crucial for each phase of the Order to Cash cycle.  This is true for the shipping process as well, since an incorrect customer shipping address can cost you additional fees per package by your carrier. In some cases, the package may even be returned to you, causing dissatisfaction for your customer and additional overhead for your company.

Most independent shipping solution providers offer an address validation module (it may cost additional fees), which can be leveraged to correct your customer master data base, with respect to addresses. If you onboard new customers frequently, or need to ship to newer addresses, investing in a shipping solution which offers address validation could be a potential savior in the long run.

• Inaccurate Package Weight

Weighing your packages before preparing the shipping lable is vital. Almost every carrier weighs the packages when they receive them in their centers. If the actual weight of the package is different from what you've stated, then an additional fee is applied to your shipping charges. This is all added cost, which can easily be avoided by investing in a good weighing scale, and preferably one which can be integrated with your shipping software.

We've seen warehouses where the weighing scale is not connected to the shipping station terminal, and the user needs to manually enter the weight on the shipping software application. This is also a potential failure point, since the user may unknowingly enter 36 instead of 63 pounds, which can go unnoticed till the point it appears as correction charges from your carrier.

Based on our experience working with shipping softwares which offer integration with weighing scales, we would highly recommend also investing in a shipping software which has such a capability.  The return on investment is definitely time saved and your shipping team on the floor will than you for it.

• Improper Packaging

Make use of premium packaging materials, such as shipping label sheets, crush-resistant boxes, and strong tape. Product damage is a result of poor packaging standards. Shrink wrapping pallets is a common practice, and making sure that the wrapping is done by a diligent shipper goes a long way.

If you handle items which can be categorized as dangerous goods or hazardous, please make sure to follow the IATA, CFR, IMDG, or the country-specific transportation regulation guide. Not following hazmat shipping regulations can cost your organization money, time, and reputation.

• Incorrect Package Dimensions

"Dimensional Weight" is a term which shippers are often familiar with. For those who are not, you may refer to our article here to gain more information. In a nutshell, dimensional weight is calculated based on the dimensions of your package, i.e., length, width and height.

Whether you are interested in a rate quote or preparing your package for shipping, it is necessary that you enter the accurate dimensions of your package. This will ensure that you get the closest to actual rate quote, and won't be charged "Weight Correction" charges by your carrier. This charge is applied when the dimensional weight calculated by the carrier system is different from what you stated in your shipment.

• Usage of correct Shipping Options

Ground vs Express is usually the norm when it comes to decision making for the package. it is mainly based on shipping cost and the transit time. If your customer needs the package delivered fast and is ready to pay a premium, Overnight or Two-day shipping can be optimal. But not in the case where you need to bear the cost or when the customer can wait for their package for a couple of days, when Ground shipping may be a wise decision.

We recommend to invest in a multi-carrier shipping solution, which can offer rate quoting (aka rate shopping) feature. This will allow you to compare your shipping cost against a range of carriers, and can then decide which carrier offers fastest delivery time at the best rate.

Other factors come into play as well, like residential delivery, Saturday Delivery, Liftgate services, Hold at location, etc., which add to your shipping cost. These are sometimes referred to as "accessorials", which you need to be mindful of, since each accessorial has cost associated to it.

• Dependence on a Single Carrier

Similar to financial portfolio, wherein putting all your eggs in one basket, can be detrimental, shipping with one carrier can be risky in some situations. With the every-changing global economic and political situations, relying on one carrier can mean that shipping may come to a halt if there is a strike or other kind of unrest with your carrier or the country in which the carrier operates.

Having more carriers onboard can help in getting better shipping rates (through negotiation obviously), eliminates your reliance on one carrier, offers flexibility to your business in case there is a need for a business scenario you never used before,  like, hazmat shipping or starting to ship international.

Again, a multi-carrier shipping solution can come to your rescue since a single carrier may not specialize in all your shipping needs. We had a customer who used to ship windshield glasses with only a specific carrier, but other automotive parts using an array of carriers. It all was driven by what we call "business rules" which drive the carrier selection automatically based on certain criteria you configure in your shipping solution (if it supports this feature). Even if carrier is not automatically driven by a set criteria, customer service team can rate shop across a range of carriers and provide the best shipping cost to your end customers.

In our world, investing in a multi-carrier shipping solution is a "win-for-all" situation.

• Incorrect Paperwork

Be it international shipping documents requirement, such as Commercial Invoice, Certificate of Origin, or hazmat shipping papers such as the IATA dangerous goods declaration, always be sure that you have the correct paperwork with each shipment going out of your location.

Incorrect or incomplete paperwork can delay your shipments and cause dissatisfaction for all the players involved in your supply chain.

If unsure about the documentation, always consult your account manager with the carrier.

Shipping has become a huge factor in supply chain, and in these modern times, there are a plethora of shipping solutions available. Choosing the correct one wisely is a business decision based on the needs of your organization. The situations mentioned above in the article can either be used to improve your shipping process, or to evaluate your current shipping process and shipping solution. It can very well pay off to move on to a different shipping solution provider as well.

With the above-mentioned common errors in shipping, assess your company's processes to assure success and customer satisfaction.  Mistakes in shipping can cost you money, time, employees, reputation, and in extreme cases, even customers.

We would love to hear back from you regarding the content of this article, and if you feel there is anything we may have missed, please do let us know.