Keeping all your costs under control is essential to balancing your books. For online stores, shipping costs are inevitable. They can significantly and unnecessarily impact your profit margin if left unchecked.
Online shoppers often look for companies that offer free shipping. Free shipping policies are so common that you risk losing potential customers if you don’t do the same.
Shipping costs are an unavoidable expense. But you may be paying much more than you need to for packaging, shipping costs, etc.
High costs in this area can impact your company’s ability to grow, especially in terms of margins and revenue.
That’s why you need to find ways to reduce shipping costs. There are several strategies you can adopt to mitigate these costs effectively and immediately.
- Free shipping & free delivery: the best strategy
Internet users consider free shipping as an incentive, and the psychological impact of this incentive is strong. Charging them represents a brake to the purchase.
However, some customers may be willing to pay a little more to get free shipping. When you adopt a free shipping policy, your conversion rate increases. Also, look at your competition’s shipping policies.
Be sure to factor in all shipping-related costs into your e-commerce checklist, including those related to packaging. Then, offer free shipping to your customers when you have determined the lowest costs. This way you can keep your prices competitive and offer your customers free shipping.
- Calculate shipping costs by destination country
For many small and medium-sized businesses, international shipping costs can reduce the profitability of doing business overseas. Shipping to some destinations can be even more expensive and complicated than others.
You could avoid shipping to these destinations altogether to maintain competitive rates, but there is another option.
Use an expert provider: companies can help you get your goods to dedicated international shipping centers. The cost of shipping from these centers to your customers will likely be more affordable.
- Weigh products to determine shipping costs
Do you know the exact shipping cost for each of your products? You can’t know the exact shipping cost of your products without knowing the total weight of the packaged item, the price is by weight.
After weighing a product in its ready-to-ship state, you can research the actual cost of shipping it to each region through the major carriers. This important step allows you to adjust your online prices to fully cover all shipping costs in your product pricing.
- Use the packaging provided by the chosen carrier
The cost of a single box or envelope may seem negligible, but these expenses can quickly add up as your quantity increases. Did you know that UPS and other carriers offer free shipping boxes and envelopes to their customers?
You can request a delivery of bulk packaging materials online, or you can pick them up at your local shipping center. However, when you start your e-commerce business, and before you choose the carrier from which you will order shipping materials, study their rates carefully.
Remember that prices are based on quantity, region, shipping distance and many other factors. Companies that have more consistency in some of these areas will be able to more easily identify savings opportunities with specific carriers.
- Use lighter packing materials
Shipping costs are also determined by the size of the packaging and the weight of the package. With this in mind, it makes sense to look for more affordable, lighter and smaller packaging materials.
Note that the type of packaging material extends to any protective filling inside the box or envelope. It also includes the packaging of the product itself.
While it is important to save on shipping costs, you should always prioritize the condition the goods will be in when the customer opens the package. Using a shipping envelope instead of a box only makes sense if your product is properly protected during shipping.
