Cat’s How To… get the most from postage

As the festive season approaches, designer-makers are busy making stock destined for Christmas trees around the country. An awful lot of care will be taken – sewing, drawing, cutting and printing. But one key area in the process (which admittedly is a lot less exciting) often gets overlooked: the logistics of getting the stock to the customer or stockist, at the right price, on time and intact. So we asked Cat How to drill Rog, the co-founder and man in charge of logistics at their colourful independent design store Howkapow, for his tips on postage. Over to Rog…

The first port of call for most traders will be the Royal Mail. The main reason simply being price. It’s very difficult for any courier company to get close to Royal Mail in terms of value. At least this is true for smaller and lighter items. Royal Mail’s small parcel service really is great value for money (and they are running a special promotional price until the 18th of January for 2nd Class Small Parcels at £2.80 for Standard and £3.90 for Signed For). This is the best option for anyone sending low volumes of smaller, less-valuable stock to customers. For more expensive orders, The ‘Signed For’ option gives you compensation cover up to £50 too. Special Delivery by 1pm is also a pretty good value for a next-day service for lighter items, and covers compensation up to £500.

If you are sending lots of items out, you should look into getting a franking machine for your postage. You’ll get better prices for printing your own postage, and trips to the post office will be easier. You just drop off a bag of post or pay to have a collection at your place of work. Beyond that, you can move on to having an account with the Royal Mail. This allows you to print off your own postage using the RMDMO online system and unlocks some business-only services such as 24/48 Tracked, but you’ll need to be spending a minimum of £5,000 a year before you can get to this point.

For larger, heavier, and more valuable shipments, you’re best bet will be a courier service. In our time running Howkapow, we’ve used most services and come to a few conclusions…

Cost is not the only consideration
Some cheaper couriers are cheap for a reason and have pretty poor track records in terms of reliability. Be sure to check out reviews for any company you plan on using. An unreliable courier will cause you headaches, waste your time, and make you look bad to your customers.

The published price is never the actual price
Couriers publish a price on their websites (known as the ‘book price’). This is the cost of sending a one-off shipment. If you set up an account with a company you will get a price based on your estimated monthly volume. The more you send, the cheaper it’ll be. Often though, just having an account will give you a better price.

Consider a broker or comparison site
Brokers bulk-buy courier services from other companies and in doing so can often offer a cheaper price than going direct to the shipper. Comparison sites also work on this basis. Do make sure that you know which courier is taking the final shipment though, as there may be some you have crossed off your list based on the aforementioned reviews.

Now you’ve chosen your postage options, you’ll know how much it’s going to cost you, so you need to decide how you are going to charge that to the customer. When we started out, we wanted to bring in as many customers as possible, so we offered free postage as standard and covered the cost out of our margin. This is really good from a customer’s point of view, as they have one price and won’t be put off by an extra postage cost. Be really careful if you decide to do this – particularly if you are selling low-value items – as you need to make sure you can cover the cost, otherwise you’ll end up losing money with every sale. Consider adding the extra postage cost to the final price of the product, so you know you are covered. If you are going to charge for postage, keep it as straightforward as possible, so the customer can easily work out what their final price will be. Transparency is key, as you don’t want to have a customer being surprised by an extra cost at the last minute.

When sending stock out to a stockist, there are a few other factors to consider. Generally these will be larger, more expensive orders, so you’ll almost certainly be using a courier, or premium Royal Mail service. If an order to a shop gets lost you may find yourself with a massive loss of revenue. The shop will still want the order, so you’ll need to make and send the order again. A shop will also expect an order to be sent by a trackable service and generally won’t mind paying for it (within reason!). When selling on a Sale or Return basis I’d insist that the shop cover any postage costs incurred.

All things considered, there isn’t really a one-size-fits-all solution when it comes to shipping, but I hope that’s gone some way to unravelling the minefield! And if all goes well, all those lovely pieces being made will all reach their destinations on time and be lighting up faces on Christmas day.

You can read more tips on selling your wares in Cat’s How To series >>

Rog How studied Engineering at Bristol University and went on to work as a Radio Producer for the BBC. In December 2010 Rog set up Howkapow with his wife, Cat How. Howkapow is a colourful design shop which supports and promotes the work of independent designers and illustrators. Follow @howkapow on Twitter.

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