Monday, 7 February 2011

International Mail Order Distribution - UK & International Courier Services

Mail order businesses can function in a variety of ways. Whether you are using an online shop or a traditional mail order catalogue, there is always one expense which can not be avoided - the cost of delivering your customers orders! The mail order distribution business model centers wholly around package delivery. When you are operating parcel distribution on a national and international level, it is important to consider the most cost-effective means of delivering your products. 

Why is Cost Reduction Important to a Mail Order Business? 

The most important aspect of any business model is to keep your expenses as low as possible in order to maximise your profits. The cost of parcel delivery can be a huge drain on your business funds if you are with the wrong supplier. Looking for opportunities to reduce your postage costs will not only reduce your overall spend, but also give you opportunity to:
  • Improve you overall profit
  • Reduce your customers charges and gain competitive advantage
  • Reduce delivery fees to attract return custom and new business
In short, reducing your delivery costs will give you far greater flexibility to gain a balance between your charges and your profits. 

Package delivery costs are passed on to my Customer, why should I worry about reducing them? 

Reducing your delivery costs in the first instance will increase your profit margin. If you charge you customers the existing delivery charge and reduce your own spend there will be more money available to invest in your business.

You may also consider reducing your customers charges as this will make you seem cheaper in comparison to your competitors. You could do this either by reducing your delivery charges, or by offering reduced product costs and recouping the loss on your delivery charges.

The lower your charges, the more customers you will receive and the more likely they will be to remain loyal to you.

How to reduce your UK and International delivery costs 

Going direct to the postal services like Royal Mail or courier services such as DHL, TNT and UPS can be expensive. Most of these companies will offer you discounts if you are sending a large volume of packages. As a mail order company you may already be receiving discounted prices but you can still be prepared to shop around.

Look for courier service broker who may be able to offer you a substantial reduction in your parcel courier costs. Courier brokers receive discounts from all the top courier service companies. The chances are that they will be receiving far greater volume discounts due to their buying power.

The added benefit to you as a Mail Order service is that you may also be able to gain further discounts on top of their already discounted courier prices depending on your volume of business. As a mail order service, you may be in a good position to negotiate reduced prices - some third-party parcel delivery providers may offer reduced rates to you once you have established a regular pattern of orders with them.

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