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What Are Your Company's Annual Sales/Revenue? My Employer's

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What Are Your Company's Annual Sales/Revenue? My Employer's Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey My employer's primary industry is... How many parcels does your company ship in a year? 42.2% 53.7% 19.3% 19.3% 9.6% 4.8% 4.8% 23.2% 13.4% 9.8% Less than 500,000 500,000 - 1 million 1 - 2 million More than 3 million What are your company's annual Regarding parcel distribution, do you single sales/revenue? source (use a single carrier for more than 80% of volume) or use multiple carriers? 48.7% Multi-source 26.3% 49% 51% Single source 11.8% 7.9% 5.3% Less than $100 $100 - $500 $500 million - $2 $2-$10 billion >More than $10 million million billion billion Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey Who is your primary parcel carrier? Do use Parcel Select carriers (carriers who drop parcels into the Postal Service for final delivery)? 41.8% 38.5% 38% No Yes 62% 12.1% 5.5% 2.2% UPS FedEx USPS FedEx SmartPost Regional carriers Which is your primary Parcel Select carrier: Why don't you use non-UPS/FedEx Parcel Select providers like OSM, Newgistics, DHL 54.8% SmartMail, etc.? (check all that apply) I AM UNAWARE OF THESE COMPANIES 22.0% LOST INCENTIVES WITH PRIMARY CARRIER 20.0% RELIABILITY CONCERNS 29.0% 18.0% PRICING NOT COMPETITIVE 16.0% TOO SATISFIED WITH CURRENT PROVIDER 12.0% 6.5% 6.5% 3.2% PREVIOUS POOR EXPERIENCE 8.0% DON'T DELIVER TO THE DDU 4.0% FedEx SmartPost UPS SurePost DHL Global Mail UPS Mail OSM Worldwide Innovations 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey How satisfied are you with the Do you use regional parcel carriers like cost/value of Parcel Select service? Eastern Connection, LSO, OnTrac, Spee- Dee, US Cargo, LaserShip, etc.? 13% 29% Extremely 26% Mostly No Not really Yes 58% 74% If "Yes", what percent of overall parcel What benefits have you realized from volume goes to regional carriers? using regionals? (check all that apply) COST SAVINGS 86.4% 54.5% FEWER SURCHARGES 72.7% LARGER 1-2 DAY DDL FOOTPRINT 45.5% SAME DAY OPTIONS 36.4% IMPROVED MINIMUM CHARGES 36.4% BETTER DIM DIVISOR/THRESHOLD 22.7% 18.2% 13.6% SPECIALIZED/CUSTOM SOLUTIONS 13.6% 9.1% 4.5% IMPROVED BILLING TERMS 9.1% < 5% 6-10% 11-20% 21-50% 51% > 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey What cost savings are you realizing by Has there been a downside to using using regionals over FedEx & UPS? regionals? (check all that apply) LIMITED DELIVERY AREA 63.6% 31.8% INCONSISTENT SERVICE 31.8% TRACKING NOT ON PAR 31.8% DRIVER/VEHICLE IMAGE 31.8% 22.7% LOSS OF FEDEX/UPS REVENUE BASED … 27.3% OPERATIONAL COMPLEXITY (SEGREGATING … 22.7% 13.6% 13.6% BILLING/REPORTING NOT ON PAR 18.2% 9.1% C/S & SALES NOT ON PAR 13.6% 4.5% 4.5% NO CARRIER PROVIDED AUTOMATION 9.1% 5% or less 6-10% 11-15% 16-20% 21-25% 26-30% 31% or more 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% How has the percent of total parcel volume FedEx & UPS eliminated 5184 cubic inch handled by regionals changed past year? threshold, so all Ground packages are rated on dimensional weight. What has 54.5% been the cost impact to your business? 36.4% 43.8% 24.7% 19.2% 9.6% 1.4% 1.4% 4.5% 4.5% No impact < 5% cost 6-10% 11-15% 21-25% > 26% Increased significantly Increased slightly No change Decreased slightly increase Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey Regarding the 2015 FedEx & UPS If "Yes" to previous question, how dimensional weight pricing for successful were you? Ground....Did you try to negotiate? 22% 11% 33% Extremely 33% No Partially Yes Not at all Not yet 56% 45% If you responded "extremely or partially" to the What have you done to try to mitigate higher last question, which statement best describes dimension-based costs? (Check all that apply) your outcome? REDUCED BOX SIZES; MINIMIZED EMPTY FILL 60.3% CARRIER CONTRACT NEGOTIATIONS LOST THRESHOLD, BUT IMPROVED DIM DIVISOR 20.0% 42.3% > USE OF REGIONALS & USPS THAT OFFER MORE FAVORABLE DIMENSIONING 39.7% IMPROVED INCENTIVES AS A PARTIAL OFFSET 11.4% MOVED LIGHTER, SMALLER PACKAGES FROM BOXES TO POLYBAGS 19.2% NEGOTIATED A NEW THRESHOLD, BUT < 5184 11.4% WE'VE DONE NOTHING, AS IT DOESN'T IMPACT US 16.7% MAINTAINED 5184 THRESHOLD, BUT DIMINISHES OVER CHANGED TRANSPORTATION MODE TO DIM-FRIENDLY SERVICES (E.G., FEDEX HOME DELIVERY TO SMARTPOST) 15.4% TIME 17.1% WE'VE DONE NOTHING, ALTHOUGH IT DOES IMPACT US 3.8% MAINTAINED 5184 THRESHOLD FOR CONTRACT TERM 17.1% WE'VE IMPLEMENTED AUTOMATION TO DYNAMICALLY REDUCE BOX SIZE 3.8% IMPROVED THRESHOLD > THAN 5184 22.9% OTHER (ORDER CONSOLIDATION) 2.6% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 0.0% 20.0% 40.0% 60.0% Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey When is the last time your company negotiated Do find negotiating with the carriers to be pricing with your primary parcel carrier? harder or easier now than a few years ago? 32.1% 32.1% 46.3% 44.8% 17.9% 17.9% 9.0% less than 6 months 6-12 months 1-2 years more than 2 years Easier Harder No difference If you answered "harder' to the question If could change UPS or FedEx Pricing Agreement, above, why? (Check all that apply) how would you? (check all that apply) FEWER SURCHARGES 82.1% TOO FEW NATIONAL PARCEL COMPETITORS 71.0% BETTER DISCOUNTS 65.4% IMPROVE DIM DIVISOR/THRESHOLD 47.4% CARRIERS FOCUSED ON REVENUE/MARGIN 64.5% BETTER MINIMUM CHARGES 35.9% FEDEX & UPS HAVE TACIT AGREEMENT TO NO REVENUE BASED INCENTIVES 17.9% AVOID PRICE WARS 54.8% BETTER PAYMENT TERMS 16.7% NOT ABLE TO USE THIRD PARTY EXPERTISE TO BENCHMARK/NEGOTIATE 19.4% STRIKE CONFIDENTIALITY 11.5% KILL EARLY TERMINATION 3.8% PRICING HAS BECOME COMMODITIZED 19.4% STATIC CONTRACT WITH NO BUILT IN … 1.3% 0.0% 20.0% 40.0% 60.0% 80.0% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey Do you create shipment labels via carrier- Do you audit all parcel invoices for late provided automation systems? shipments, erroneous charges, etc.? No Exclusively, for all of our parcels 21% 15% We spot check invoices, but 29% Some, for the majority of our it's not a comprehensive parcels 42% audit Few, we mostly use other 22% We audit every package 22% systems internally 28% None, we only use other 21% systems We outsource to an audit firm Do you feel USPS Priority Mail (and Priority Mail If you answered doubtful or definitely not in last Express) are viable alternatives to UPS & FedEx 2 questions, why? (Check all that apply) Air/Express? RELIABILITY CONCERNS 83.9% PRICING NOT COMPETITIVE 77.4% 33.3% LIMITED TRACKING 71.0% 29.6% POOR CUSTOMER SERVICE 71.0% HARD TO DO BUSINESS WITH USPS 67.7% 19.8% SALES REP NOT ON PAR 51.6% 17.3% CONFUSING SERVICE REQUIREMENTS 41.9% LIMITED PAYMENT OPTIONS 22.6% NO FREE, CARRIER-PROVIDED AUTOMATION 22.6% OTHER (PACKAGES TOO LARGE, MULTIPLE PIECE; LOCAL … 12.9% Definitely not Doubtful Probably Yes, definitely 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% Copyrighted Information - Unauthorized Use Prohibited (Property of Shipware, LLC) Shipware LLC and PARCEL's 2015 Parcel Pricing Benchmarking Survey What do you think are true USPS To keep shipping costs in check, actions taken in advantages? (check all that apply) the past 12 months. (Check all that apply) NO ACCESSORIAL CHARGES 67.9% RENEGOTIATED CONTRACT RATES/TERMS 57.7% PRICING 64.1% IMPROVED PACKAGING 53.8% 6 DAYS/WEEK DELIVERY 61.5% GREATER USE OF USPS 44.9% FINAL MILE EXPERTISE 41.0% AUDIT CARRIER INVOICES 42.3% PRIORITY MAIL 1-3 DAY DDL VS 1-5 GROUND 34.6% LEAST-COST-ROUTING… 21.8% OUNCE-BASED PRICING 34.6% GREATER USE OF REGIONALS 17.9% FREE PACKAGING 24.4% GREATER USE OF PARCEL SELECT 14.1% 194 DIM DIVISOR (ZONES 5-8) 14.1% 1728 DIM THRESHOLD 10.3% HAVE NOT TAKEN ANY ACTIONS 6.4% BALLOON RATING (ZONES 1-4) 1.3% GREATER USE OF CONSOLIDATORS 1.3% 0.0% 20.0% 40.0% 60.0% 80.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% About the survey: To keep shipping costs in check, actions plan to Shipware LLC and PARCEL again teamed up to provide shippers greater insight take over next 12 mos (Check all that apply) to understand the current parcel market, trends and opportunities. Part 1 of the annual Shipper's Parcel Pricing & Benchmarking Survey was conducted RENEGOTIATE CONTRACT RATES/TERMS 55.1% throughout Sept 2015.
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