Would You Ship Your Luggage to Save on Baggage Fees? This Startup Hopes So

published Feb 8, 2019
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Everyone hates baggage fees, whether they’re unexpected or not. But clearly, the airlines know how to make a bundle off them: In 2017, US airlines collected $4.6 billion in checked baggage fees. Enter: LugLess, a new travel startup that offers a cost-competitive alternative to checking bags. The company is hoping that customers are willing to part with the traditional baggage-checking model in order to score cheaper luggage shipping rates.

Here’s how it works: Customers print a shipping label, and then bring their items to a UPS or FedEx store. For an extra charge, their items can be picked up right at their door. Meanwhile, you travel with your necessities, and then pick up your luggage at a UPS or FedEx store in your destination city. And of course, for an extra fee, your items can be delivered right to you final destination, like a hotel. LugLess says their average cost to ship one 50-lb bag is $28, only a slight price dip from the $30 the same bag would cost on major airlines. But the real price differences start to appear when you pile on more bags—LugLess cites their average cost of shipping three 50-lb bags is $82, which is quite a difference from the average price of $220 for the same three bags on major airlines.

JetBlue’s CEO recently defended the pricey baggage fees in order “to improve its margins while focusing on the areas that it considers a priority: service, legroom, and in-flight entertainment.” And certainly, it’s understandable that airlines want to make a profit. But the airlines are raising their profits without committing to what passengers truly want, which is reasonable luggage prices. LugLess points out that in the last 10 years, we’ve seen a major change with the creation of the self-service kiosk. But they point out that even though that’s a newer invention, it doesn’t actually create less work for the traveler. Meanwhile, the baggage claim area is still completely the same as it’s always been (read: extremely tedious). This sets up the airline industry for trouble, since evidence shows that when industries don’t adapt, customers go elsewhere. (Just look at the taxi industry in the wake of Lyft and Uber.)

LugLess also notes that as the price of checking bags increases, its value is going down. We’re even seeing some situations where the baggage check price is more expensive than the flight ticket price itself. Meanwhile, airlines charge the same for baggage no matter how far a customer is flying. With web companies like Google Flights, Kayak, and Expedia using baggage fee calculators now, airlines are going to have to find a way to keep up.

If this all sounds familiar, perhaps you caught an episode of Shark Tank back in 2013, when founder Brian Altomare had trouble convincing the sharks of supporting his business. Now, Altomare has changed LugLess’s business model to reflect the advice the sharks give him, and told CNBC recently that getting their criticism was “the best experience of [his] career.”