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After The Sale:
Packing & Shipping

My ability to pack and ship products can be unfavorably compared to my eight-year-old son’s. He has been working hard on his Cub Scout badges so he is a whiz with knots, knives, cardboard and tape. He also knows his way around a computer. In truth, the only reason he isn’t our shipping department is that his return address is always Andy@puppyrangers.

It is a good thing that my business delivers information rather than fragile or bulky items. I know how to use FedEx, UPS and the U.S. Postal Service. Luckily, I know how to find the right shipping specialists for our business services clients.

As your business grows, the “right” solution will change. A small business owner may enjoy an opportunity to get some fresh air and human contact by going to the post office or another delivery service regularly. If you ship a lot of product, though, it is a great idea to periodically evaluate your alternative choices to see if they can save you time and/or money.

The three key decision points in packing and shipping yourself, hiring someone else or outsourcing the job are cost, time and customer service.

Cost and time are closely related. If you have a very small business and are not busy all of the time, it is “less expensive” to pack and ship products yourself. If you have “free time”, your out-of-pocket costs will be in materials and the shipping fees. If you and your employees are usually busy, packaging and shipping costs you at least 1.3 times the wages of the shipping personnel. These additional costs include employer paid taxes, benefits, space, utilities, insurance and other “overhead” items.

Time has another cost. When you work on a task, you cannot work on other jobs. People are usually most productive at 55 – 60 maximum hours of work per week. Once you go beyond that, you may start “spinning your wheels” and taking longer to get work done than you would if rested. Although small business owners are known for putting in many, many hours, your time may be more profitably spent on other things. If it costs you $10 an hour to hire someone to do a job and you could be making $50 an hour selling to clients, you lose $40 for every hour that you do a job someone else could do more cheaply for you.

Can you provide better customer service in-house or by hiring an outside company? That will depend on how your business operates. If you are an artisan making hand-crafted products, or if you require deep concentration, you will work best without interruption. Customers can be given specific hours of contact and you can use voice mail. However, you risk losing customers if their needs are not heard and met quickly.

In our business consulting, we are interested in how work flows for our customers. What needs to happen and when? Who is going to do the work? We help our clients choose the fulfillment process that works best for them at this stage in their business. Changes can be as small as suggesting that they use a pickup delivery service like UPS rather than going to the post office daily. They can be as large as helping them to find a full service fulfillment house that will handle every aspect of managing inventory, shipping, return processing and full customer service support. Once these services catered only to medium-to-large companies but are now available for even very small businesses.

We have had clients who packed everything themselves, then drove it to the post office daily. Others have chosen to take their products to a retail packaging service such as Mail Boxes, Etc. or PostNet for shipping. A recent development has been the rise of the specialty shippers such as Craters & Freighters, which build specially designed containers for a wide variety of fragile or bulky items. If you ship product in quantity, you will want to consider using a freight forwarding service.

At each stage of your business, you will need to make decisions on how to be efficient, effective and responsive to customer needs. The big e-commerce companies have made customers expect quick and easy product delivery from anyone doing business today. Decide what is right for your business now, then check check your options at least once a year. As you grow, you may find yourself using outside service providers and then, later, bringing it back in-house as you add people, products and facilities.

Profitable relationships with clients do not stop with the sale. The customer care they get will be “top of mind” when it is time to do business again.

-Cynthia Nemeth-Johannes