Know Your Carrier and Know Your Business During Negotiations

Long gone are the days of relying solely on United Parcel Service (UPS) or the U.S. Postal Service (USPS) for all your small package ground delivery needs. Nowadays, most mailers are not only turning to a mixture of different carriers, but they’re also better able to negotiate carrier contracts than ever before. Rick Collins and Tim Geiken, both managing directors at transportation and shipping consultancy AFMS Inc., offered during a session at NCOF several negotiation pointers to catalog shippers when working out small parcel shipping contracts with carriers. Among these,
-Understand your business better than your carrier does.
-Look at your previous contracts and how well you did, specifically, last go-round.
-Keep in mind that carriers want revenue commitments to entice you not to use the competition.
-Don’t just demand low rates from a carrier during negotiations. Instead, provide them with a story line -- where your company has been, where it’s going, what your overall needs are, etc. This way, your rep will go to bat for you.