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Is this warehouse F*cking me? It smells like complete bullshit...

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MitchM

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The warehouse I am working with made a big mistake with customs and a bunch of orders got sent back at once. It led to like $5k+ in charges. It was their fault so they said they'd cover it. So, I considered the whole situation reconciled.

A few weeks later - after about 20 pallets were picked up - I get a message from one of them telling me about their palletizing fees:
This FBA request for 26 pallets took 17 hours total to be prepared across 11 men. We are only taking into account the original prep and not the relabelling done after which took an extra 2 people / 3 hours work. Labor fee as informed above is $40/h. Total cost for labor for this project would then be $7480.
After considering all the trouble and time wasted for the misscommunication about the pickup address, I´ve reached out to my supervisor about this, and we will cut down this labor charge to $4600.

The total shipment was 330 cartons with 3 units each. The units required zero picking. All that had to be done was add 3 units to each carton (which I provided) - slap on the FBA label - and then palletize.

So... 17 hours x 11 men = 187 man hours. 187 man hours = 11,220 minutes.

11,220 minutes / 330 cartons...

THAT'S 11 MINUTES PER UNIT OR 34 MINUTES PER CARTON.

What in the actual f*ck?

They added on the labeling fees after their "Discount" to $4600 - so it ended up being about $5,500.

I discussed options with these as*holes before we set up the shipment to see what would be the most cost effective. At no point did they ever indicate we were talking these kinds of man hours. I would have just done a small parcel shipment and had each individual unit labeled if I had known. It would have gotten my inventory in faster too.

I already reached out to some of my suppliers to confirm my suspicion because it's the weekend and the other warehouse I work with isn't open, but I simply cannot fathom what could take them this long.

So, do you guys think they're trying to make up lost money for their screw up with the customs - or am I dumb and missing something?

To me this seems like total bullshit.
 
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Eudaimonium

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Are these units unusually heavy or large? What are the terms you agreed on?

It does sound inflated. When a price is lowered from 7480 to 4600, there is so much 'flexibility' that all numbers provided have little to do with actual cost.
 

MJ DeMarco

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Something does smell fishy. And they know they have you by the balls. What are you going to do, ask them to ship to another warehouse?

IDEA: As a recourse, I would make a video of you doing the preparation in a painfully slow fashion... then send it to him as evidence -- the time you took (in slow motion) was 2X faster than what they charged. Will be a bit hard to counter that fact.
 

Rabby

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$7840 sounds like anchoring to get you to feel relieved and grateful that they're cutting the fee almost in half. I like @MJ DeMarco 's idea of videoing the packing process... if you can pack a unit in 1 minute, why should it take a trained warehouse worker 11 minutes? Or whatever it is... but they'll have to decide whether to defends themselves as incompetents or frauds, if their numbers are that inflated.
 
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Kak

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That is outrageous. I pay a fraction of that to transload bulk train cars of chemicals into drums and totes on that many pallets. I know, different industry, but still. The labor for this stuff is not that expensive or they wouldn’t be a business very long.
 

thechosen1

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Some businesses suck so bad that the only time they can turn a profit is when they screw people. Run away fast, once you’re done with this issue.

We deal with competitors who are like that: we bid on a project, get told our price is too high, but then the “cheap” guys get it, f*ck it all up, and raise all sorts of extra charges on the customer in the process.

Luckily that usually means we gain that customer back for years. At least, until they want to repeat the cycle. Major part of Control is to not rely on one customer, one supplier, etc.
 

MJ DeMarco

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Any update on what you plan to do?
 
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Marzook

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So, do you guys think they're trying to make up lost money for their screw up with the customs - or am I dumb and missing something?
you use a freight forwarder or do you let them control the shipment and logistics? I would suggest a proper freight forward like someone from kuehn and nagel etc, for your predicament. Thats a load of shit to fix especially now with OMICRON (the whole greek alphabet will be probably utilized for this plandemic)....

its a supply chain nightmare out there due to the fact that china still calls the shots as they are the only nation with the infrastructure and cheap manpower to actually give the rest of the world what it wants despite more mandates and more shutdowns which will probably come in the next few weeks.... the west is two steps backwards (worried, scared etc) while china inches forward keeping the factory lights on... just how it works...

I discussed options with these as*holes before we set up the shipment to see what would be the most cost effective. At no point did they ever indicate we were talking these kinds of man hours.
did you ever document this interaction with them? also, you need to set up some sort of supply chain verification system that deals with all these predicaments whether it be via skype, teams and a paper trail is your best friend.
 

MitchM

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you use a freight forwarder or do you let them control the shipment and logistics? I would suggest a proper freight forward like someone from kuehn and nagel etc, for your predicament. Thats a load of shit to fix especially now with OMICRON (the whole greek alphabet will be probably utilized for this plandemic)....

its a supply chain nightmare out there due to the fact that china still calls the shots as they are the only nation with the infrastructure and cheap manpower to actually give the rest of the world what it wants despite more mandates and more shutdowns which will probably come in the next few weeks.... the west is two steps backwards (worried, scared etc) while china inches forward keeping the factory lights on... just how it works...


did you ever document this interaction with them? also, you need to set up some sort of supply chain verification system that deals with all these predicaments whether it be via skype, teams and a paper trail is your best friend.
Yeah, I’m definitely going to have to step up my game here.

They’re a reputable company in the states, but that doesn’t mean they won’t try to pull one over on you.

After my conversations with my other warehouse that I work with - as well as my supplier - they’re clearly exaggerating their hours.

It’s that, or they made several mistakes along the way - and billed me those hours.

Either way, I’ve already let them know unless we find a compromise I won’t be working with them again.
 

MitchM

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Something does smell fishy. And they know they have you by the balls. What are you going to do, ask them to ship to another warehouse?

IDEA: As a recourse, I would make a video of you doing the preparation in a painfully slow fashion... then send it to him as evidence -- the time you took (in slow motion) was 2X faster than what they charged. Will be a bit hard to counter that fact.
I actually just recorded a video like this myself!

I have already let a few things slide with them, but this is just too obviously BS.

I’m going to send it to them tomorrow because I’ve got to re-record it.

I was such a dick in the video that I honestly feel it will do more harm than good

They haven’t replied to my message explaining how the math just doesn’t work and how past experience makes it seem absurd.

I haven’t gotten a response yet… but I’ve spent over $60k with them in the past month so I doubt they’re just going to shrug it off.

Thank you guys for your recommendations.

Every single point of the supply chain has been turned into a nightmare - so hopefully this will all be an opportunity to tighten things up and get a leg up on competitors.
 
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Marzook

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Either way, I’ve already let them know unless we find a compromise I won’t be working with them again.
this. i tell my clients to always have two or three sometimes backup logistics handlers (shippers, suppliers) just in case
 

MitchM

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this. i tell my clients to always have two or three sometimes backup logistics handlers (shippers, suppliers) just in case
On that note - although it looks like there is going to be a compromise - I am no longer interested in working with them.

That kind of dishonesty is not something I ever want to deal with when working with someone that should have my back if we are going to do business in the long term.

It was a short sighted and stupid move on their part.

If anyone has someone that they love who they work with for both storage, third party fulfillment, and inbound shipments to Amazon - I'm all ears.
 

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