61 replies to this topic

[letterpe]

Just today I questioned the shipping charges from my supplier. He said it would cost me $150.00 in shipping for my order. I called my regular transport company and asked for a quote. His quote was at $ 48.00 + taxes. I called back the supplier and advised him that I would pick-up because it cost me way less. The reply from the supplier was, no problem you can pick-up but there will be a $15.00 charge added to my invoice for shipping and handling service. Just could not believe it. Not only must we now pay for catalogues to increase their bottom line, now they are going after shipping charges. What's the world going to??? Why sell for this supplier? Do you deal at Hyline DateMinder???

[Martyk1026]

I don't think it is a secret that some suppliers jack up costs. The question is "by how much?" I used to give a lot of business to a company that produced sticky note cubes and pads, but they overcharged me one time too many and finally lost my business forever. However, keep in mind that there is a cost to packing, addressing and shipping product. Even if I arrange for alternate shipping or charge to my own UPS account, I have no problem with a nominal charge by the supplier for the cost of the master box, packing materials and labor.

[imcreativejane]

That's outrageous. I have noticed some of my suppliers have started a "handling" fee for all orders. But when I can get the same item shipped for $10 somewhere else that these guys are charging $15; my customers will notice the difference. I want to keep doing business with them, but money is the true measure here. Unless... I want to eat it and go broke.

[piglet]

I just got hit with $13.05 to ship 500 business cards a few states away. Since I charge my customer what I pay for shipping, they are going to question that for sure! When I questioned the company, they said that FedEx charges a flat rate of $9, plus a "handling fee." What a rip-off for 500 business cards.

Thank you to all the suppliers that pass along their shipping discount. :)

[royster13]

Are any suppliers using "Flat Rate" boxes from the Post Office on small orders.....I buy my cello envelopes from www.uniquepacking.com For small orders he uses Flat Rate boxes and I have received over 100 shipments without a problem....

[imcreativejane]

I asked one of my suppliers to put something in a flat rate box (for $4.95) and ship it to me. I still got charged over $9 in shipping on the invoice; but they didn't use my suggestion and the postage on the box only showed $5.15. All it was - was a pin. I had to reship it to my client and that costs me another $4 - $5. Sucks to be in our shoes sometimes on these small orders.

[tmertz]

We are investigating the Post Office Flat Rate Shipping at TradeNet. Fed Ex actually does most of the delivery. They pick up and deliver cross country to the destination Post Office where the Post Office takes over. While in the Fed Ex system the order is tracked. When Fed Ex turns it over to the Post Office there is no tracking until the Post Office enters a delivered tracking entry.

I am not sure whether we need separate manifesting equipment or can manifest on our existing Fed Ex manifest. I am not sure what it will take to offer freight quotes automatically.

Our products do not lend themselves to using box sizes defined by someone else. We would (I think) package our product in existing boxes and then put them in Flat Rate boxes.

If any Suppliers have used Flat Rate shipping they might comment.

[jmyers]

Tom - Same conclusion here as we look into these as far as boxing them ourselves prior to flat rate boxes. Not sure about equipment changes yet either, as we are just getting into this conversation with folks.

[ProPrinters]

i have a client who is a bookstore. Book companies charge a flat rate 7% of the total order. 100 $= $7 and so on. No problem, so it is fair.

Recently the started ordering books on CD- you know where I am going with this don't you.

My client ordered $1600 worth of CDs, maybe 100 CDs. Total weight 20lbs?

the book company still charged her the 7%. You don't have to be a Phi Beta Kappa from MIT to understand that the system there is broken.

You can always use your own shipper number but if the supplier passes discounts on you will lose money.

[Alex Symms]

What I always suggest doing is using a 3rd party account number if you have any reservations that the freight quotation is high (if available from that supplier). In fact, I'd recommend that in any situation possible. That way you avoid any possible unnecessary charges. We personally don't charge those "handling fees" or "added shipping charges", it's just part of our business overhead and we personally don't feel it's needed to charge the client an additional charge on top of the services rendered. But one way you might be able to avoid this is by using your (or your client's) 3rd party account number.

[amplady]

I will never give my fedex # to anyone (ever) after a Canadian supplier shipped me "free" samples (an apron & such) and I got billed $50.00!!

___________

On the other hand, why does a Supplier assume that it is OK to ignore an
"In-Hands" date on a PO and ship GROUND?!

I realize this is a different issue but seriously, the NJ supplier that met my production requirement refused to take responsibility for NOT shipping overnight (obviously I would have paid more), saying they "completed order earlier than agreed Production."

Hello? What good does it do if the item is getting there after they promised my client?

Just lost $40.00 on 1st-time customer Order. Too much aggravation for less than qty bookmarks.


______
Ambulance Driver: "Whew, this has to be a Record . . . we got here in 8 minutes flat!

Hospital Worker: "Yeah, but something's missing - the Patient!

Driver: I knew things were going too good :rolleyes:

[samknox]

I believe, with the possible exception of ceramics, that packaging should be included in the product price. I don't order from Staples or Amazon and get charged for the box. That's ridiculous. The product has to get from the plant to the end user some how. And UPS doesn't allow for things to be shipped in a plastic grocery bag...

That said I agree with the suppliers that say use 3rd party billing. Unless we are ordering a huge quantity of one product and the supplier discount makes it worth while, we always use our own account. Some suppliers charge a fee ($3 - $10) but in the end it's worth it to increase our UPS discount. It keeps our supplier relationships good, and we are able to track exactly what we spend in shipping.

[jimknecht]

samknox said:

I believe, with the possible exception of ceramics, that packaging should be included in the product price. I don't order from Staples or Amazon and get charged for the box. That's ridiculous. The product has to get from the plant to the end user some how. And UPS doesn't allow for things to be shipped in a plastic grocery bag...

Agree packaging should be included, however I have a problem with your other statement. Many suppliers, such as us, allow you to order in less than case lot. For example, our smooth stadium cups come to us in cases of 500. However, we ship many an order with quantities less than 500. All those require new, special packaging.

[DSubasa]

Jim is dead on with my thinking on this subject.

Im going to invite someone to try and do the crazy math on that. Say a product ships out in full boxes of 250 units, but someone only orders 400 units (so 2 boxes, 1 full, 1 partial), how do you make sure your box and labor cost (for shipping) is covered on the partial?

Its just far easier to go per box to cover the corrugated.

[Allan]

Why is this all the sudden an issue? I don't believe I have ever seen a boxing charge. Shipping and handling, yes but now a boxing charge. Some things are built into the cost of doing business. I don't like a heck of a lot of line charges added to the bill. My customers want a bottom line price and don't want to be told that a product is $1.20 plus tax, plus shipping and handling oh and i forgot we have to charge for the box to get it to you. Figure the cost of the shipping container in the cost of the item or put it in the shipping and handling charge. When we call for a quote, the supplier should know how much something weighs and what size the box is and I give the ZIP so figuring out the shipping charge is a no-brainer. Add some for handling and give me a price. If I want to use my shipper #, you can add a nominal (not outrageous) handling fee to cover the box if you have to.

[admaven5050]

We have had problems with a couple of our suppliers through the years......over charging for freight (using published book rates instead of our industry's discounted rates with FEDEX and also UPS)....and also tacking on handling charges.
Our solution was simple. Since our Purchase Order is the only contract in force, if the supplier selects to accept it and do business with us, we have added the following lines:

THIS ORDER MUST SHIP BY GROUND UNDER OUR FEDEX ACCNT #XXXX-XXX-X (PREFERRED) OR OUR UPS # XXXXXX
NO ALLOWANCE OR CHARGES ARE ALLOWED FOR FACTORY HANDLING AND/OR BOXING OF THIS ORDER.

If the supplier wishes to do business with us they have to do it our way. We do not accept the statement .....that the additional charges are spelled out on page 586 of their giant catalog. The catalog is a statement of their policy. Our purchase order is a contract. And contract law wins out over company policy.

[jimknecht]

admaven5050 said:

The catalog is a statement of their policy. Our purchase order is a contract. And contract law wins out over company policy.

Mike, I beg to differ. We might want to get a legal opinion on this. You say your PO is a contract. You know what, I have signed several contracts in my time, and they sure requires a lot more than me simply accepting a PO. Every contact I have signed requires a lawyer & signatures of witnesses... plus being notarized. Never done that for a PO before.

You distributors choose to work with a supplier. Therefore, you should be required to follow our policies and not try to override them with statements on your PO. When I purchase things from my vendors, I sure don't expect anything I state to override their published policy... unless I get a waiver in writing.

[admaven5050]

jimknecht said:

Mike, I beg to differ. We might want to get a legal opinion on this. You say your PO is a contract. You know what, I have signed several contracts in my time, and they sure requires a lot more than me simply accepting a PO. Every contact I have signed requires a lawyer & signatures of witnesses... plus being notarized. Never done that for a PO before.

You distributors choose to work with a supplier. Therefore, you should be required to follow our policies and not try to override them with statements on your PO. When I purchase things from my vendors, I sure don't expect anything I state to override their published policy... unless I get a waiver in writing.

Jim,
Its hard to believe that you've never heard of nor made a verbal contract. A contract is merely an offer and the acceptance of the offer and whatever terms are stipulated.
My PO is the contract that controls the purchase. If my PO calls for a blue pen that's what I'm ordering. I do not have to accept nor pay for a yellow pen.
When you purchase from your vendors if you order green imprinting ink I doubt if you would accept or pay for magenta. No lawyers and no notary necessary.
The terms I put on my PO state the shipping method and also that they can not charge me to put my order in a box. I'm not ordering in odd lot sizes and I only added the stipulation because the vendor was seriously overcharging for freight and handling. My condition was defensive in nature.
Think of it this way.....lets say that you order 6 skids of plastic pellets used in the makiing of cups. Your purchase order says to ship by truck LTL. Lo and behold the vendor decides to pack the plastic pellets into 30 lb boxes and there are 300 boxes....and to top things off they ship each box as a separate shipment by UPS. They don't even ship it using hundredweight.
They don't follow the purchase order.
Would you pay them the shipping charge on their invoice (which includes an extra $5.00 per box for handling). Or would you sink your heels into the ground and complain that they didn't follow the PO?........the contract controlling the purchase???
I await your response, and I ceretainly respect your opinions and insight.

[jimknecht]

You are so right my friend. There are all types of contracts, and actually the terms do not have to be stated... they can be implied. For example, when you go to the doctor, there is an implied contract that you must pay for services rendered. Likewise, it is implied that the doctor can not charge you extra simply because you have a big nose. These are implied because it is a normal part of everyday life... something we all agree with.

But here is the key. Any contract, no matter written, oral or implied, has to have one thing... mutual agreement. Both parties must agree, in one form or another. So yes, the basic info on your PO is a contract. However, on the same hand, the written policies of a supplier are likewise a contract. By sending your order to the supplier, you likewise have agreed to a contract... all without lawyers.

So yes, a supplier contractually agrees to the "normal" parts of your PO... which include all the things you discuss. It is a normal part of everyday life in our industry for distributors to submit a PO. It is a normal part of everyday life that the supplier must print the specified product, in the specified color & shipped in the specified way & time. We all mutually agree to these terms every day. However, one party can not unilaterally add a term, a term that is not the part of everyday business practice, and expect that to be part of the contract.

For example, you can not state on your PO that you think setup charges should be included in the unit price & that your company will refuse to pay any setup charge. You can not add a term that failure to ship the order on time will incur a $1000 penalty.

If a supplier has a stated policy of charging a handling fee, no matter whose account is used, your unilateral statement does not make a contract. You both have not agreed & your position is not an accepted industry norm.

So yes, there are components of contracts whenever distributors & suppliers do business. You have a PO & we have stated policies. That being said, neither of us can unilaterally add anything & expect that to be part of the contract. Other issues are at play.

Edited by jimknecht, 12 March 2010 - 03:34 AM.

[tmertz]

A Supplier should not start production until everything on the Distributor's PO that they do not agree with has been resolved. I did not say agreed to. TradeNet will refuse to accept Distributor Purchase Orders if we are not willing to accept the "terms" the Distributor has on them. Sometimes it is a matter of incorrect pricing or options left off. This "old fashioned" way of doing business results in a call and added expense on a high percentage of orders.

That is why TradeNet offers a $5 discount for online order entry. In this environment the Supplier controls the terms and when the order entry is completed the Distributor knows exactly what ALL their costs and terms will be. These orders except for those Distributor accounts that have credit concerns will go straight into production. TradeNet has an accurate order (if we have our products setup correctly) and everyone is happy. If we receive an order that is not correct we accept the order but quickly fix the product information so that all future orders on that product are correct.

In regard to Distributors using third party billing on freight: They are doing this because UPS and FedEx offer discounts. As Distributors take these discounts and margins away from Suppliers, Suppliers will have to make up those margins elsewhere. Margins on freight are part of a Supplier's budget to cover overhead. Distributors may feel they have gained in one area but the Supplier will have to make adjustments so that the Distributor pays more or gets less in another area.