The Challenge: Leaving Money on the Table
As their FedEx contract renewal approached in July 2024, the supplier received an initial proposal that would have yielded a mere 5.6% in savings, approximately $163,052 annually. While a saving, it felt underwhelming.
The client’s logistics team suspected there was more room for negotiation but lacked the granular data and deep carrier contract expertise to effectively challenge the proposal’s complex terms, punitive fees, and restrictive waivers. They were at risk of accepting a subpar agreement, leaving hundreds of thousands of dollars in potential savings unrealized.
“Zero Down’s expertise was a game-changer. They dove into the fine print of our FedEx agreement and found savings we didn’t know were possible. Their guidance during the negotiation process gave us the confidence to push for a better deal, and the results speak for themselves.”
Director of Logistics
The Solution: A Data-Driven Negotiation Strategy
The Zero Down team was brought in to analyze the proposal and shipping data, and to architect a powerful counter-negotiation strategy. The approach was methodical and precise:
- Deep-Dive Analysis: Zero Down’s experts analyzed the client’s shipping data from January to April 2024, identifying the specific service lines and surcharges that offered the most significant opportunities for savings.
- Strategic Counter-Proposal: Armed with data, Zero Down crafted a detailed counteroffer advising the client to push for specific, high-impact amendments. This included a 60% increase in Priority Overnight discounts, a higher discount on returns pickup surcharges, a new 18% fuel discount, and adjustments to the earned discount tiers to protect the client from volume fluctuations.
- Strategic Carrier Negotiation: Zero Down guided the client through two rounds of negotiations, providing the data and talking points needed to reject the initial offer and justify their counter-proposal. A key point of leverage was insisting on the removal of the Money Back Guarantee (MBG) waiver, which entitled the client to refunds for late shipments.
- Ongoing Audit & Recovery: Following the successful negotiation, Zero Down proposed an ongoing parcel audit. With the MBG waiver removed, the client could now recover an estimated $17,000 annually from service failures that were previously non-refundable.
The Results: A 135% Improvement on the Initial Offer
By leveraging Zero Down’s expertise, the medical equipment supplier transformed a weak proposal into a powerful, long-term cost-saving agreement. The final, accepted contract delivered tangible, quantifiable results, starting with $392,648 in projected annual savings—a 13.2% reduction in their total FedEx spend. This represented a 135% increase in savings compared to FedEx’s initial 5.6% offer.
A major component of this win was a newly secured 18% fuel surcharge discount, projected to save over $105,000 annually on its own. Furthermore, the team successfully removed the restrictive Money Back Guarantee waiver, unlocking the ability to claim refunds on all late shipments. This strategic move, combined with the new ongoing parcel audit, identified an additional $17,000 in annual recovery opportunities that were previously non-refundable.
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