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<blockquote data-quote="Ricochet1a" data-source="post: 986132" data-attributes="member: 22880"><p>Let's get some things out there regarding how Express gives discounts to various customers. </p><p></p><p>Just for using a FedEx account, a shipper receives the "standard" 16% discount. NOBODY, NOBODY pays full over-the-counter rate if they have an account with FedEx.</p><p></p><p>As the volume a particular shipper increases, the discount that is offered increases. This is STANDARD INDUSTRY PRACTICE.</p><p></p><p>Most significant shippers get 30% off of published rates. As the volume goes up, so does the discount. The federal government gets a discount which makes the Express employee 75% discount look puny (and you thought you were getting a "special" deal...).</p><p></p><p>This is all industry standard (to give discounts off of PUBLISHED RATES) based upon the volume a shipper puts into Express.</p><p></p><p>What Express WON'T do, is offer shippers discounts ABOVE AND BEYOND what they consider industry standard for the volume being offered by a particular shipper. Most shippers, when they are looking at choosing a carrier, want a discount ABOVE that which is normally offered, to make a choice as to carrier to use. Express WON'T cut deals with shippers to grab business from UPS - they offer the standard discount based off of anticipated (and historical volume if they are a long term customer).</p><p></p><p>Conversely, UPS sales WILL offer discounts above and beyond industry standard, to grab volume. When it comes time to renew these contracts, UPS sales will then gradually cut the discount offered (ratchet up the price), until they are near "industry standard". When this occurs, the account will often bounce back and forth between UPS and Express - or you'll see a situation where a shipper will use BOTH (choosing which carrier to use based off historical pricing levels to particular markets). </p><p></p><p>Express WON'T compete on the basis of price with UPS for overnight volume - this is why a significant portion of Express volume with low volume shippers has been "poached" by UPS over the past few years. When I was a Courier, I witnessed first hand how UPS would come in and offer cut rates on next and 2nd day shipping, and grab accounts from Express. Express sales would make NO MOVE to attempt to get these accounts back - they'd offer the same discount from published rates and sit on their hands. </p><p></p><p>This attempt to get sales leads from Couriers is a joke - and sales KNOWS it. Customers know what their options are regarding shipping options and will contact both UPS and FedEx (and the USPS) for a rate - discount from published over the counter rates. Just think about it, how many shippers (businesses that have volume that need to be moved from one location to another) DON'T know that FedEx is in the business of moving volume from one location to another? DHL had that problem when it made a run at the US domestic market, but FedEx certainly DOESN'T have that problem (lack of awareness among business types).</p><p></p><p>All sales has to do (to find new business start-ups) is to look through an index of business licenses listed in a particular area, then make cold calls to those businesses which aren't in their existing database. Its basic marketing (what they are paid to do). </p><p></p><p>Couriers on the delivery side are more often than not making their deliveries to locations which don't ship out volume of their own (they are on the receiving side only), OR are making deliveries to businesses which already have an Express account. On the flip side, pickup Couriers are obviously making their stops at locations which already have an Express account, but they don't have time to walk into a random business and give a sales pitch. Most businesses out there have a no solicitation policy, just to prevent having their time wasted with such antics. </p><p></p><p>There are a few small businesses which start up which may slip through the cracks (sales doesn't have them listed in their index), but the actual volume offered by these businesses is PUNY. The whole smoke screen of getting Couriers out there to generate sales leads is merely an attempt to get them to try to pick up the remaining scraps that sales may have missed. It does work on occasion - but does anyone seriously think that FedEx sales is that incompetent when it comes to finding new businesses which are in need of shipping their product?</p><p></p><p>When it comes to the Express product offered by FedEx, FedEx WON'T compete on the basis of price. With the large volume shippers they do offer substantial discounts from published rates - BUT SO DOES UPS. FedEx sales WON'T offer cut rate pricing in order to grab market share for Express - they will do so however for Ground, and increasingly Freight too. FedEx sales does this with Ground, since Ground has such large margins, that they can indeed offer cut rate pricing in order to grab market share from UPS - and STILL make a profit while doing so.</p></blockquote><p></p>
[QUOTE="Ricochet1a, post: 986132, member: 22880"] Let's get some things out there regarding how Express gives discounts to various customers. Just for using a FedEx account, a shipper receives the "standard" 16% discount. NOBODY, NOBODY pays full over-the-counter rate if they have an account with FedEx. As the volume a particular shipper increases, the discount that is offered increases. This is STANDARD INDUSTRY PRACTICE. Most significant shippers get 30% off of published rates. As the volume goes up, so does the discount. The federal government gets a discount which makes the Express employee 75% discount look puny (and you thought you were getting a "special" deal...). This is all industry standard (to give discounts off of PUBLISHED RATES) based upon the volume a shipper puts into Express. What Express WON'T do, is offer shippers discounts ABOVE AND BEYOND what they consider industry standard for the volume being offered by a particular shipper. Most shippers, when they are looking at choosing a carrier, want a discount ABOVE that which is normally offered, to make a choice as to carrier to use. Express WON'T cut deals with shippers to grab business from UPS - they offer the standard discount based off of anticipated (and historical volume if they are a long term customer). Conversely, UPS sales WILL offer discounts above and beyond industry standard, to grab volume. When it comes time to renew these contracts, UPS sales will then gradually cut the discount offered (ratchet up the price), until they are near "industry standard". When this occurs, the account will often bounce back and forth between UPS and Express - or you'll see a situation where a shipper will use BOTH (choosing which carrier to use based off historical pricing levels to particular markets). Express WON'T compete on the basis of price with UPS for overnight volume - this is why a significant portion of Express volume with low volume shippers has been "poached" by UPS over the past few years. When I was a Courier, I witnessed first hand how UPS would come in and offer cut rates on next and 2nd day shipping, and grab accounts from Express. Express sales would make NO MOVE to attempt to get these accounts back - they'd offer the same discount from published rates and sit on their hands. This attempt to get sales leads from Couriers is a joke - and sales KNOWS it. Customers know what their options are regarding shipping options and will contact both UPS and FedEx (and the USPS) for a rate - discount from published over the counter rates. Just think about it, how many shippers (businesses that have volume that need to be moved from one location to another) DON'T know that FedEx is in the business of moving volume from one location to another? DHL had that problem when it made a run at the US domestic market, but FedEx certainly DOESN'T have that problem (lack of awareness among business types). All sales has to do (to find new business start-ups) is to look through an index of business licenses listed in a particular area, then make cold calls to those businesses which aren't in their existing database. Its basic marketing (what they are paid to do). Couriers on the delivery side are more often than not making their deliveries to locations which don't ship out volume of their own (they are on the receiving side only), OR are making deliveries to businesses which already have an Express account. On the flip side, pickup Couriers are obviously making their stops at locations which already have an Express account, but they don't have time to walk into a random business and give a sales pitch. Most businesses out there have a no solicitation policy, just to prevent having their time wasted with such antics. There are a few small businesses which start up which may slip through the cracks (sales doesn't have them listed in their index), but the actual volume offered by these businesses is PUNY. The whole smoke screen of getting Couriers out there to generate sales leads is merely an attempt to get them to try to pick up the remaining scraps that sales may have missed. It does work on occasion - but does anyone seriously think that FedEx sales is that incompetent when it comes to finding new businesses which are in need of shipping their product? When it comes to the Express product offered by FedEx, FedEx WON'T compete on the basis of price. With the large volume shippers they do offer substantial discounts from published rates - BUT SO DOES UPS. FedEx sales WON'T offer cut rate pricing in order to grab market share for Express - they will do so however for Ground, and increasingly Freight too. FedEx sales does this with Ground, since Ground has such large margins, that they can indeed offer cut rate pricing in order to grab market share from UPS - and STILL make a profit while doing so. [/QUOTE]
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