On March 1, 2007, uShip will improve the experience that both Service Providers and Shippers have by making an important change to the way payments are handled for uShip transactions. From March 1st forward, uShip will begin collecting a Deposit from Shippers when they accept bids on uShip. This Deposit will be credited to Service Providers’ uShip accounts and will offset Service Providers’ match fees due to uShip.
We have been testing this new system with a large group of Service Providers, and we’ve received overwhelmingly positive feedback from both Shippers and Service Providers.
Here are some of the benefits we have seen:
- Since Shippers who accept bids are required to pay a deposit, they are proven to be more serious and committed to completing the transaction. Our research shows that Shippers are 20% less likely to cancel on bids requiring a deposit.
- Shippers are more comfortable paying a deposit through uShip than directly to Service Providers, so they are more likely to accept bids.
- uShip can accept credit cards, bank transfers and PayPal payments for deposit payments, so Service Providers don’t need a merchant account and pay no merchant fees on the deposit payment.
- Shippers are pre-paying a deposit equal to Service Providers’ uShip match fee, so Service Providers don’t have to pay uShip a large lump sum each month.
- Since large monthly invoice payments are eliminated*, Service Providers will not be charged late fees, interest, or penalties.
How it Works
If a Service Provider places a bid of $600, the Shipper pays a deposit of $59.68 (based on the tiered fee system) when they accept the bid. This deposits shows up as a $59.68 credit on the Service Provider’s uShip invoice. The Shipper then pays the balance of the shipping price, $540.32 ($600 – $59.68), directly to the Service Provider.
A New Bidding Tool – “Amount to Me”
Our new “Amount to Me” bidding tool allows Service Providers to enter the final amount they want to earn on a particular job (ex. $1000) into the “Amount to Me” field and uShip will automatically add our fees to this amount and present the total bid to the Shipper. If a Service Provider’s bid is accepted, they will then receive the full amount they entered ($1000) from the Shipper. This feature will be available March 1, 2007.
This program will go live to all uShip members on March 1, 2007. If you have any questions or comments between now and then, we invite you to share them on our “Bidding Process” Discussion Forum.
* Some service providers may still be required to make payments on their invoice, such as for Book it Now matches, and accounts that are currently past due.