GEARING UP FOR NEGOTIATION SEASON
The preparations you make now can have long-lasting effects, so be sure your negotiation game is up to par.
egotiation pre-season is about to kickoff. Annually, we should be reviewing our agreements, adjustments, and invoices (invoices are our Magic 8-Ball to reveal rates and weights). A little pre-season prep can eliminate that post-season post-audit of invoices, where you wonder where all the negotiated savings went. Preparing for rate changes is like prepping a recipe — we need to know what is currently in-house, what our receipts look like, and what is on our list.
BY BRITTANY BEECROFT
WHAT’S IN HOUSE Data Simply put — you need to know what you ship. How will you reduce costs if you don’t know what drives them? Are you looking at all volume or just outbound shipments? (Hint… if you are paying for it, you need to monitor it.) Is your data even accurate? Just like a recipe, keep it raw when you can. Additives skew taste; mining skews data. Zone 1 skews the short-haul landscape (Zone who?). Remember what we learned in Negotiating 101 —
32 PARCELindustry.com SEPTEMBER-OCTOBER 2017
you can’t negotiate if you don’t know what you are negotiating. Weight How much does your shipment weigh? If your answer did not consider actual versus billed weight, dimensional versus minimum billable weight (MBW) — you may be quadrupling your base rate. For those of you avoiding the DIM by using a FedEx box, grab an invoice and make sure you are not paying MBW. Let’s say we are sending some promotional material Standard Overnight to Zone 6. The actual weight of the tube is one pound at a $54.35 list rate for 2017. Applying MBW, the billed weight is seven pounds at what
PARCEL September/October 2017