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Shipper / cost determination.

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    Shipper / cost determination.

    This isn't really an A5 question but it relates to a database I'm building for a customer. It's a "has anyone else ever done this" question. (It's not a "how to" question because I've already done it.)

    I'm hoping there is someone else out there who has had some experience working with shipping issues.

    Briefly, here's the situation: I have a customer who ships over 2000 packages every month. They claim their request (explained below) is the same as what "everybody" does - at least the top 10-20% of shippers in the US - and, therefore, it should be a drop-in solution for about $500. (500 is my guess of what they expected.)

    Here's what they want done: (assume 3 possible shipping companies.)

    Start by determining the package weight based on the components to go in each box and enter that value in the database. (This is actually to be determined before the box is packed because labels need to be generated prior to packing so each box can be custom packed using 'ref' data on the label.) Then get a list of each shipper's prices and determine the lowest price shipper for each individual package based on the shipping zone, weight, and any special situations (extra charge / non-delivery) for specific zip codes. Basically, this means determining the lowest 'std' price then determining if any special pricing exists. If special pricing exists for the lowest price shipper, then the price must be checked for every shipper - including special situations for those other shippers. (The 'special' situations vary from shipper to shipper.)

    Finally, after determining the shipper to be used, export a list of shipments which can be imported into the shipper's computer program to print labels and create a manifest for the driver.

    My guess is that most companies determine a standard shipper for specific areas or package types/sizes and then only change if the customer requests special shipping or the standard shipper's program rejects a shipment because they don't deliver to that location.

    Has anyone out there had shipping experience (database or otherwise) that might shed some light on this situation?

    #2
    RE: Shipper / cost determination.

    What are the average weight/sizes for the packages? If they are small packages the shipper can use UPS or FDX ground. Their pricing is identical (unless you have a special deal) and they both ship to anywhere in the US. The only determination is which carrier the customer wants.

    However, if the packages are large and you have to ship by truck and there is where it is a totally different ball game and your varibles are in affect. My question is truck or small shipments?

    Comment


      #3
      RE: Shipper / cost determination.

      Hi Cal,

      I have a similar application for a courier that uses local delivery
      people to pick up parcels from the shipper and put them on an airplane.
      At the destination, another local delivery company picks them up at the
      airport and delivers them to the final destination. The tough part
      about this is he has different charges for each customer for the same
      type of service .... such as; before 8:00 AM, after 5:00 PM, Saturdays,
      Sundays, Holidays, excess weight, waiting time, extra trips because
      no one is available at the pickup or delivery location or is not open,
      extra miles, etc.

      efs

      Comment


        #4
        RE: Shipper / cost determination.

        Hi Cal,

        I have a similar application for a courier that uses local delivery
        people to pick up parcels from the shipper and put them on an airplane.
        At the destination, another local delivery company picks them up at the
        airport and delivers them to the final destination. The tough part
        about this is he has different charges for each customer for the same
        type of service .... such as; before 8:00 AM, after 5:00 PM, Saturdays,
        Sundays, Holidays, excess weight, waiting time, extra trips because
        no one is available at the pickup or delivery location or is not open,
        extra miles, etc.

        efs

        Comment


          #5
          RE: Shipper / cost determination.

          Shipments range from a few pounds to about 50 pounds. I don't believe anything is over 70.

          There is one big shipment every month of about 1500-2000 boxes with the other 20% or so scattered throughout the month.

          Yes, they do have special deals with two of their current shippers. (I didn't want to add that complexity to my original question.)

          Besides, this isn't really a question of how best to ship. The real question is, "Does anybody else do it like this or is this unique?"

          Comment


            #6
            RE: Shipper / cost determination.

            No, it's not standard, but than, there's not much of a standard out there, at least not in all the years I've audited or consulted. Many of the larger accounting software packages are moving to providing a link to the "StarShip Shipping" system (do a Google) after discovering there is no one-best way to write this kind of stuff. However, your client may have to reevaluate that $500 cap.

            Comment


              #7
              RE: Shipper / cost determination.

              Cal,
              All that you are describing is definately not standard stuff in the world of mid-range multi-user accounting-distribution software packages.
              Capturing the shipping weights is fairly standard as well as the ability to calculate freight charges based on a zone.
              Comparing prices among different shippers and determining the most economocal shipper is not standard. Nor is the situation of special pricing for special situations.
              In my opinion, an expectation of a $500 charge for a set of features like this would be very unreasonable.
              John

              Comment


                #8
                RE: Shipper / cost determination.

                John,

                Would you mind verifying your statement: Nor is the situation of special pricing for special situations.

                What I meant by referring to special pricing was that some zipcodes are considered "rural" by UPS and incur an additional charge while for Airborne some zipcodes incur an additional charge and some are a "no ship" zip code. Each shipper gave me a list of these zip codes so I could consider them in my cost calculations.

                Where you aware of this? Was this what you were referring to in your statement?

                As to the cost, I think $5000 would be more accurate.

                Thanks,
                Cal

                Comment


                  #9
                  RE: Shipper / cost determination.

                  Comparing prices among different shippers and determining the most economocal shipper is not standard. Nor is the situation of special pricing for special situations.
                  In my opinion, an expectation of a $500 charge for a set of features like this would be very unreasonable.

                  John, I'm confused. What do you feel would be a resonable price based on non standard issues?

                  kenn
                  TYVM :) kenn

                  Knowing what you can achieve will not become reality until you imagine and explore.

                  Comment


                    #10
                    RE: Shipper / cost determination.

                    Ken,
                    I'm not really sure what you're confused about but I'll give it a shot. I meant unreasonable in several ways.
                    1) The cost of creating specifications, designing, programming , testing, implementing and ultimately fine tuning the features described by Cal would be much more than $500 no matter how he figures his costs.
                    2) The set of features described by Cal are not standard in most software packages. Any argument that the cost should be minimal because those features are "par for the course" in other distribution packages and the client should not have to pay for "reinventing the wheel" is not valid in my opinion.

                    As far as a "reasonable" price, that would be up to Cal and the hourly rate he charges for his work. It would then be up to the client to see if the business benefits are worth the cost.
                    John

                    Comment


                      #11
                      RE: Shipper / cost determination.

                      Cal,

                      One of my concerns for this database is also how they expect to keep the mailing charge rates updated in the face of any special deals. The deals might be seasonal or of limited time duration. Are they going to be content with entering the mailing cost data and if not, is there a way to import this on a regular basis?

                      I can't imagine that many programs do this process for the lowest price. They may do it automatically for zone and weight by standard charges. To get the lowest shipping price, you'd have to index by zone, weight, time of day delivery, and then any other metric that would give you a special pricing deal. As soon as someone invents another pricing deal, your database becomes slightly obsolete.

                      Dave

                      Comment


                        #12
                        RE: Shipper / cost determination.

                        Your concerns are quite valid, Dave.

                        The customer has special deals with each current shipper that last for 2-4 years. These are basically %off deals so only new standard rates would need to be applied. I finally figured out a relatively easy way to get the shippers' rates into something that is readable by A5 but it's not something that would be easy to automate. Once I get it into readable form, I've automated the rest of the update routine. (All rates must ultimately be in one table.)

                        As you may gather by the above, they will have to call me to do the updates when new rates are implemented.

                        As to indexing, you have to index by zone, weight, and price then check for "extra cost" or "no ship" zip codes. I am "lucky" (????) that they only use one shipment type per shipping company so there is no need to worry about time of day, etc.

                        My actual estimate of cost is at least $5000 for the basic app. but I know I'll never get that amount.

                        Comment


                          #13
                          RE: Shipper / cost determination.

                          Thanks guys for all your input.

                          I think I now have enough ammo to convince the customer that all future updates will be done at my standard hourly rate - no more deals!!

                          I know some of you are wondering how much I got paid for this but I will only say that it was well over the 500 they expected but also well under 5000 it should have cost. There were a lot of issues which drove the final price including a 'snowballing' effect and some previous issues with the same customer.

                          Comment


                            #14
                            RE: Shipper / cost determination.

                            Hi Phorum,

                            All of this brings to mind the application for a courier that I am
                            developing. Does anyone know of a DBF table that supplies the mileage
                            between various zip codes, I could sure simplify my app if it exists.

                            There are several available, such "as door to door", however I need one
                            that will lookup the mileage when 2 different zip codes are entered
                            into an Alpha form.

                            Thank you,
                            efs

                            Comment


                              #15
                              RE: Shipper / cost determination.

                              John,

                              I suspect that what the customer was hoping for was for Cal to do the development work and sell this to about 10 other companies and charge each one only 1/5 the development cost. The price of development can sometimes be marketed this way. This would put both parties ahead and be a share the wealth approach if it could be done. The next question is does the customer want Cal to sell this advanced pricing to all the competition?

                              As long as the customer can make back his investment in a reasonably short time, spending money to be money ahead should be a no brainer.

                              Dave

                              Comment

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