Michael Sherman is the co-owner of the family-owned and operated business My Team Shirts. They make custom apparel that’s perfect for groups looking for team uniforms, making everything from t-shirts for recreational sports leagues and corporate office softball leagues to youth robotics teams and everything in between. The business is based in Calgary, Alberta and ships across Canada. After realizing success, they decided to expand and launched a new part of their business across the border in the United States of America – My Team Shirts USA.
Unfortunately, the launch in the United States came with many frustrating problems. My Team Shirts started working with a third-party company for fulfillment, packaging and shipping. Soon enough, they found that the third-party was producing less-than-favourable results. The quality of the service, error rate and turnaround time for product orders were subpar and it was difficult to get information on orders to provide customer service. To accommodate for delays and shipping errors, My Team Shirts started paying for Express Delivery on shipments.
Turning to higher costs to speed up deliveries and keep their customers happy wasn’t a sustainable solution. They looked elsewhere to see if they could find a convenient way to service their US-based customers. Find out how netParcel helped them reduce shipping fees, boost delivery services, gain quality control and increase levels of customer service:
My Team Shirts was already a long-term client of netParcel. As a Shopify merchant, they used the courier brokering services for two years to make domestic shipments for customers across Canada. After the business reached out for assistance, netParcel reviewed their shipping expenses and we came up with a surprising solution: move production back to the original facilities in Calgary. As strange as it sounds, it was financially advantageous for the business to ship product orders to the United States from Canada than to ship domestically in the United States with the methods they were using.
The first reason we suggested that My Team Shirts move production back to their Canadian location was so that they could use netParcel’s courier brokering services instead of working with the third-party company. The business could take advantage of the long list of discounted shipping rates to better suit their budget. Our application can save businesses up to 70% on shipping rates, allowing them to keep their money for other critical expenses. Depending on the product order, My Team Shirts could save costs on small parcel shipping, LTL shipping and volume consolidated shipping.
It’s easy to assume, as My Team Shirts did. that shipping from Canada would cost more and take longer due to taxes and duties at the border. However, as long as the value of the shipment is lower than the de minimis, My Team Shirts wouldn’t pay additional taxes or duties to get their products to their US-based clients. Since orders were for sports teams, orders were well within the de minimis limit.
De minimis is a Latin expression that translates to “about minimal things.” In this context, the expression means that the dollar value of imported goods is considered too small for Customs to collect duty rates or taxes off of it. The dollar value of the shipment would have to exceed the de minimis before Customs would enforce procedures at the border.
In 1993, the de minimis amount was a value of $200 (US Dollars) per shipment. The value ballooned to $800 per shipment in 2016 and it remains the same. The change in value was made to incite business growth and encourage trade between the United States and Canada. It specifically targeted smaller Canadian companies who wanted to reach customers across the border but had avoided tapping into the market because their budget couldn’t handle any additional fees.
Along with saving smaller businesses money, a larger de minimis effectively speeds up delivery times for products. Large product orders can be stopped at the border to calculate duties and taxes — this can turn the travel time into a slog, especially during high-traffic times like the winter holidays. By sending products that comply with the de minimis amount, businesses will ensure that their shipments experience accelerated border clearances
My Team Shirts wanted to change their methods because of the service quality, not just the pricing. They found that the third-party company was taking too long to fulfill orders and making too many shipping errors. The window to get deliveries to customers at an appropriate time was small. Since their product orders were already behind schedule, the team felt they had to push for express delivery times to guarantee customer satisfaction. The slow production was a flaw that they couldn’t contend with in the long run.
As a solution, moving production back to the Canadian base meant that they could have the same turnaround times as their domestic orders. By speeding up the preparation and packaging, the team wouldn’t feel compelled to spend more money to rush to reach their deadlines. If anything, they could save more by choosing more relaxed delivery times.
In addition to speeding up turnaround times, using netParcel for shipments to customers in the United States improves the quality of service, especially in comparison to the disappointing results from the third-party company. As a courier broker, we offer a long list of discounted shipping rates from different highly-trusted carriers like FedEx, Purolator, UPS, Loomis Express, Con-Way and Old Dominion Freight. These are companies that are known for their efficiency, speediness and reliability.
NetParcel also gives businesses like My Team Shirts the option to change their minds if they feel like a carrier is letting them down with delivery times, rates or service quality. Instead of feeling pigeon-holed into a bad situation, they can choose another one of the integrated carriers in an instant. They won’t have to take time out of their schedule to shop around for quotes from different carriers, compare the rates and then take a chance on a new carrier. So, if the business somehow encounters problems like they had with the third-party company in the United States, they can recover immediately.
The team at My Team Shirts was skeptical about the change but excited about the potential of success. They listened to the suggestion made by netParcel, and did a number of tests with great success. They are now moving their production back to their facilities in Calgary, Alberta. After making the significant change, they cut shipping costs, improved turnaround time and maintained quality control. Now they can reach their customers across the United States without sacrificing quality or resources.