If you run an online store or frequently send gifts, you are probably concerned about shipping fees from delivery companies.
Which is the cheapest among Japan Post, Sagawa Express, and Yamato Transport?
How much cheaper do shipping fees get when you sign a contract with a delivery company?
In this article, we would like to introduce the market prices based on our experience contracting with various companies in Japan.
We have omitted specific company names and exact figures in this blog, so we hope you will understand this as a general mechanism.
For single-parcel delivery, the top three major companies offer the lowest rates
Among delivery companies in Japan, the top three in order of shipping volume are Yamato Transport, Sagawa Express, and Japan Post.
Yamato Transport accounts for just over 40%, Sagawa Express for just under 30%, and Japan Post for just over 20%. Approximately 95% of all parcel deliveries in Japan are handled by these three companies.
Therefore, when comparing single-parcel shipments, one of these three companies will almost certainly offer the lowest rates.
Which of the three companies is the cheapest?
When comparing the prices of the three companies, Yu-Pack (Japan Post) will probably offer the lowest rates.
However, to be honest, the difference is not that significant, so for small lots, there is no problem using any delivery company.
In fact, our company has contracts with all three companies, and we regularly receive shipping fee estimates from them, but the details are almost the same everywhere.
Regarding quality, while there are slight strengths and weaknesses in delivery speed and damage rates, the service quality is almost the same across the board.
Track Record and Relationships Lower Shipping Fees
Getting cheaper shipping fees among them is actually quite simple.
There is a method to get a slight discount by getting competitive quotes from these three companies, but the most effective factor is nothing other than the track record of how many packages you ship in a year.
For example, no matter how much someone who ships only 10 packages a month negotiates shipping fees, they will probably only be able to secure a discount of a few yen per package.
Roughly speaking, the relationship between volume and price (for all sizes, nationwide average in Japan) is as follows.
Based on our experience, the threshold for a significant reduction in shipping fees is whether you exceed 50,000 packages per year.
By the way, the lowest rate per package we have received in our past contracts was 325 yen.
We have also heard of companies that had contracts for as low as 280 yen.
However, in recent years, it seems that almost no company provides estimates below 350 yen.
Therefore, the general shipping fee of around 800 yen can be reduced to about 350 yen with a cheap corporate contract, which is considered the limit for shipping prices!
Shipping Fulfillment Companies for Cheaper Rates Even for a Single Package
Whether or not annual shipments exceed 50,000 packages is actually a significantly high hurdle.
Therefore, our recommended method to reduce shipping fees is to use a shipping fulfillment company.
Since shipping fulfillment companies manage products from various businesses together, they almost always have shipping contracts for over 50,000 packages.
As a result, you can ship your products at the shipping rate based on 50,000 packages, even for a single shipment.
If you ship products yourself, you will need to cover expenses such as an 800 yen shipping fee, creation of shipping labels and delivery slips, cardboard boxes, cushioning materials, and labor costs.
If you use a shipping fulfillment company, it only requires a discounted shipping fee plus a handling fee of about 100 yen, making it logically much cheaper than doing it yourself.
In fact, the shipping fulfillment service provided by our company also starts from 500 yen per shipment, including all expenses such as shipping fees.
In conclusion, if you ship fewer than 10,000 packages a year, there is a high possibility that it will be more cost-effective to use a forwarding or fulfillment company.
Options for Pallet Delivery and Charter Delivery
If you have a certain volume of goods and your main business is BtoB rather than BtoC, there are different options from single-parcel delivery.
These include using consolidated truck shipping, where the pricing structure is based on pallets or weight rather than the number of packages, or chartering an entire truck for dedicated transport.
Pallet Delivery
Pallet delivery is handled by mid-sized transport companies rather than the top three major companies.
Basically, rates are often calculated per kilogram, but there are also cases where a flat rate is charged per pallet.
Since it costs around 8,000 yen per pallet, if you load 20 or more small boxes onto a pallet, this method will likely offer better cost performance.
Charter Delivery
Charter delivery is handled by quite a large number of small and medium-sized transport companies.
You choose the size based on the volume, such as Akabou (light cargo trucks up to 350 kg), 1-ton trucks, 2-ton trucks, or 4-ton trucks. You can charter a vehicle and a driver starting from a few thousand yen.
The cost is determined by the distance, but even for long distances, it usually stays under 100,000 yen, making it the most cost-effective delivery method!