Malvern's Shipping Software Blog

In the current economy-- filled with IT spending restraints and tight cash flow, it is difficult to make a significant IT investment in hopes of a tangible return on investment. This is where the idea of SaaS (software as a service) shines.

Historically, shipping software- which often includes sophisticated integration into other business systems (as well as customized business rules)- bears a considerable, up-front cost.

However, in light of the number of businesses cutting back on IT spending, integrated, multi-carrier shipping software has now become available at modest monthly fee. In addition to avoiding the upfront cost, in many cases there is no long-term commitment required with an SaaS shipping system either. 

As a result, there is considerably less risk and upfront cost associated with implementing an SaaS Shipping System.

Now that initial cost has been eliminted as a hurdle, let's consider three of the many areas of improvement that a third-party SaaS shipping system can provide:

More Seamless Integration
The integration capabilities of free, carrier provided systems (such as UPS WorldShip and FedEx Ship Manager) have definitely improved over the years. However, they are still light years behind the capabilities of a multi-carrier shipping system with a rules-based integration engine. With a carrier system, integration typically requires creating a database table (or import file) which matches the carriers' requirements.  With the appropriate multi-carrier system, there should be no need to make any changes to your database nor any limitations on what data can be imported and exported. For example, international shipping is often a tedious, time-consuming process in a carrier-provided system.  However, with a third-party shipping system, line item data (such as product description and value) can be imported automatically. In addition, all shipping data including list and/or discounted shipping charges, tracking #s and more can be exported in real time (or batch) directly back into your database or host system.

Increased Efficiency
Since free, carrier-provided shipping systems are used by thousands of users with diverse requirements, these shipping systems are designed to do everything for everybody. This has resulted in having just about every option and input field spread out all over one busy looking screen. An ideal multi-carrier system should permit you to fine-tune the screen to eliminate unnecessary options and, most importantly, to streamline the shipping process by reducing key strokes. In addition to full access to all data, options and parameters, a multi-carrier shipping system with a rules-based integration engine can automatically perform logical functions which eliminate manual steps such as activating certain parameters including Signature services, Email Notification, Alternate Billing, Insurance, and more.

Reduction in Freight Costs
Why do UPS and FedEx give away free systems? These carriers more than recoup the cost of the system by maintaining a monopoly within many customers' businesses. While automatically rate shopping between UPS and FedEx will not always yield significant savings, there are many cases where rate shopping can yield considerable savings. With a system that can automatically compare multiple options to find the cheapest method, you can reduce your shipping charges-- increasing your profit margins and enabling you to be more competitive-- particularly when selling online. While virtually any carrier services can be compared including LTL (less than truckload), one of the most common comparisons is between UPS and Postal or FedEx and Postal. When shipping direct to consumers, the residential, delivery area or rural fees often applied by UPS and FedEx (which can be substantial) can be eliminated when using the postal service. So, by incorporating this type of comparison automatically, freight charges can be reduced effortlessly.

Endicia is a leading provider of internet postage solutions. They offer a robust application called DAZzle which manages your prepaid postage (purchasing, etc) and generates postal shipping labels.

When it comes to low-volume postal shipping, DAZzle is adequate as a stand-alone application. However, for shippers looking for more advanced functionality (such as incorporating additional carriers, batch processing, rate shopping, sophisticated integration, custom labels and more) an integrated shipping solution is necessary.

Here are some of the more common areas where a shipping system with integration to Endicia can add value:

Multiple-Carrier Rate Shopping
In addition to shipping through the postal service, many Endicia users also use UPS, FedEx, DHL and other carriers. In many cases, a primary factor in determining the carrier and service level is the price. So, in order to streamline the use of multiple carriers and to maximize the savings associated with comparing rates, a shipping system capable of automatic rate shopping is necessary.

A shipping system function (commonly referred to as) "bestway carrier selection" enables the shipping software to choose the best (cheapest) method from two or more configurable methods-- such as Priority Mail, UPS Ground and FedEx Home Delivery. Because this happens automatically, bestway solutions are ideal for medium to high volume shippers.

A multi-carrier rate shop screen is an alternative (manual) method for selecting the cheapest method. A rate shop screen is typically a grid or chart of available service levels sorted by cost.  The user can select the appropriate method (without consulting other applications, rate charts, the internet, etc).  With a single click, all of the rates appear. 

Obviously, automatic bestway carrier selection is more efficent, but in many operations, a combination of both methods are used. 

Automatic Batch Processing
Batch processing is the automatic printing of multiple shipping labels all. Batch processing is ideal when product weights are known. Since each item does not need to be weighed, multiple shipping labels can be processed all at once (instead of individually.) For example, an internet retailer might downloaded orders received in a shopping cart and print all of the shipping labels at once-- automatically.

Batch processing can be used for a single carrier (e.g., just postal shipments through Endicia) or with multiple carriers-- such as UPS and FedEx too. When combined with other functions such as integration, packing list printing and rate shopping, batch processing can offer dramatic improvements to overall efficiency.

Host Integration
Users of the stand-alone DAZzle application generally do not have any efficient means of seamlessly integrating shipping data (import and export) with their host business systems or databases.

Integration is one of the most common benefits of Integrated DAZzle partner solutions. The most basic integration involves importing shipping address based on an Order # and exporting tracking #, shipping charges, etc.

More sophisticated integration might include bestway rate shopping codes, additional reference data, package contents, package dimensions and virtually any other relevant shipping data. Integration might also include "business rules" to automatically perform decisions or steps that would normally be taken manually.

Custom Labeling
The DAZzle label designer software is very flexible in its ability to print custom fields, doc-tabs and more. However, in order to take full advantage, integration is typically necessary to pass through the additional label data automatically.

A Case Study
This online retailer of iPod accessories, batteries and chargers downloads orders from a shopping cart into a .csv file once per day. Since the weights for all products are known, the shipper uses a batch processing function in their third-party shipping system (Malvern Manifest System) to generate all labels automatically. The 4" x 8" labels include a customized Packing List section listing the SKU, quantity and description for ever line item within each order. The shipper processes about 200-300  postal shipments daily in fewer than 30 minutes. Prior to implementing batch processing, it took nearly a full day. In terms of operational improvements alone, the return on investment in their third-party shipping system was approximately 5 weeks.
 

PR: wait...  I: wait...  L: wait...  LD: wait...  I: wait... wait...  C: wait...  SD: wait...

Providing Proof-of-Delivery data is a critical challenge that many HME/DME (Home & Durable Medical Equipment) suppliers face. Proof-of-Delivery (POD) data is often required in order to receive payments for Medicare claims.

In many cases, timely claims processing depends on the HME/DME supplier's ability to provide proof that a package was delivered to a patient (or customer). The faster this process can be completed, the more quickly claim payments can be received.  So, naturally, any automation that can be applied to this process is beneficial.

Carrier provided shipping systems such as UPS Worldship and FedEx Ship Manager are not capable of automatically tracking shipments and posting proof-of-delivery results back into your database.

The two most common solutions are (1) a custom tracking solution or (2) a third-party shipping system.  In both cases, the automatic tracking must also result in either storing the results in your order management or other host system or by generating reports or export (Excel) files.

Some third-party shipping systems can automatically track every package shipped routinely until every package is delivered. As the results are updated, they should be able to automatically post the delivery date, time, signed for by, etc information back into your business system. Tracking results are generally also available from search screens within the shipping software and in reports and export files that can be generated by the shipping system.

When Medicare claims processing is problematic due to slow and manual Proof-of-Delivery processing, the cost for a third-party shipping system can be quickly and easily justified. 

One of the main purposes of shipping systems, other than printing shipping labels and maintaining records of shipments, is automating what would otherwise be an extremely laborious process of shipping packages. Automation is accomplished by integrating the shipping system with the customer's host order-entry system (or database). 

Most of the information required to ship a package resides in some sort of order management system, and by integrating the two systems, the data can be made to flow seamlessly to and from the shipping system, thereby eliminating the need for manual keyboard entry.  Not only is time and effort dramatically reduced, but transcription errors are avoided as well.

There are two primary methods for moving data from the order management system or database to the shipping system.  First, a customer-provided process is used to export data from the host system (orders database, shopping cart, etc) to an Excel, CSV, or text file with the required information.  In the second case, the shipping system is configured to connect directly to the host system's database and to import the required information automatically using ODBC, XML, tcp/ip and other "real-time" methods.

The same two methods apply to moving data from the shipping system back into the host system. The shipping system can create an export file (with tracking #s, shipping charges, etc) that gets read back into the host system in a batch.  Or, the shipping system can "push" the export data back into the host system in real-time via ODBC, etc.

The primary benefits to integrating the import process:

• Reduction in manual entry errors
• More efficient shipping process (fewer keystrokes to ship a package)
• No need to maintain an additional customer address databases on the shipping system. 

The primary benefits to inegrating the export process: 

• Reduction in manual entry errors (keying shipping charges, etc back into host system)
• Improved customer service with real-time access to shipping status, tracking #s, etc 

I recently ordered laptop memory from a MAJOR online retailer that was delivered in a half cubic foot box. [Pause while you picture this. Hint: picture a marble getting delivered inside a shoe box.]

This is a clear indication that many shipping operations have failed to adjust to the recent but significant changes in volume-based pricing. Apparently, it seems, many shippers do not realize that size does matter. 

A half cubic foot box (6" x 12" x 12") which weighs up to 1 lb gets billed at a 5 lb rate.  Sent by UPS Next Day Air® to zone 6, the 2008 list rate would have been $48.25. The 1 lb rate would have been only $32.55.  Appropriate- sized packaging would have yielded a savings of $15.70.

You should make every effort to avoid getting "dinged" after the fact for dimensional weight charges that you did not and cannot pass along to your customers.  If customers prepay for (estimated) freight charges, you should be sure to understand which products result in dim weight charges. Be sure to factor in this incremental  amount or do what you can to reduce the dim weight charges through better packaging. 

Building real-time rate shopping into your Order Entry process (taking both weight and dimensions into consideration) can eliminate this issue automatically. However, this requires that you store this data for your products, do not perform a lot of re-packing, and that you have the ability to integrate a rating engine into your Order Entry system and/or Shopping Cart.

Many shippers under estimate how significantly these charges can snowball and how easily a once-profit-generating shipping operation (or at least breakeven) can turn into a losing proposition.

Many third-party shipping systems can be configured to automatically prompt users for dimensions for express and/or ground shipments. They can also prompt the user to enter just a box code and then automatically recall dimensions for commonly used boxes. If your product dimensions are ever known, these dimensions can be imported too. Then, in all cases, dimensions can be incorporated into the rate.