Balancing Customer Expectations and Shipping Costs During COVID-19

by | Mar 26, 2020 | Articles, COVID-19

Since FedEx and UPS both suspended their service guarantees this week, our clients have been flooding us with questions about how to handle this unique situation.

“Business as usual” is out the window, so shippers must quickly adjust to this new normal. Adapting starts with close, careful communication with your customers. 

Since service is no longer guaranteed, should I offer expedited shipping or should I choose a less-expensive service type?

The answer depends on how well you know your products, your customers, and your service contract.

Generally, if your products must be delivered quickly (if they’re perishable or critical to medical efforts, for example), you should still choose expedited shipping and warn your customers that while you will get their package out as quickly as possible, carriers are not guaranteeing service times so the package might be late, even if they pay for rush shipping.

Customers who decide that their package is not urgent after all might wish to pay less for slower delivery time and select a less costly service type.

Understand your contract and your shipping data

However, it’s important to know what’s in your contract and what your shipping data tells you about your business. If you don’t typically ship a lot of ground packages, for example, and don’t have a good ground discount in place, you could be hit with huge costs when you pay the published rate. Check your agreement and see if there are more cost-effective service types that fit into your business model and your customers’ expectations.

Your customers might readily accept slower delivery times, knowing that the logistics industry as a whole has shifted to prioritize essential healthcare and household items. Or they might still demand expedited shipping (and be willing to pay for it) due to an immediate need for your products.

Communicate, communicate, communicate

Get a feel for what your customer base as a whole will tolerate at this time, and then communicate clearly and efficiently with each customer before and after their order to help them understand the situation. Then you’ll be better equipped to make decisions that save you money and preserve your customer experience.

If you’re a shipper, we understand the stress and confusion that’s plaguing you right now. We’ve set up a COVID-19 resource page for shippers that features carrier news and updates, shipper best practices and FAQs. If you’re interested in speaking with an expert about your situation, we’re here to answer your questions. Let’s hop on the phone and talk about this.

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