Overview

Shipping is an integral part of online business. How small businesses manage shipping, fulfilment, as well as returns, are determinant factors for the growth of a business.

In the age of Amazon Prime, consumers demand products much faster. Moreover, they expect new and improved product arrival and unboxing experience.

If that is not all, customers also demand more transparency and clarity in the supply chain, making fulfilment extremely critical for business health.

Most obviously, consumers depend on the ease of returns and quick repayments.

Shipping is extremely vital for a small business, and often, overwhelming too. So, let’s learn more about shipping, and we begin with cost.

Shipping Costs – The Pivotal Factor

Before setting up shipping rates and processes in the cart, understand the cost of shipping and calculations.

Shipping costs depend on:

• Service & Speed: Amazon has given customers what they seek – shorter time of delivery and multiple shipping options. Now, if you expedite the shipping, you have to be prepared to pay more. However, that is not the only thing affecting your costs. Carriers offer services depending on various factors; the one-size-fits-all formula does not work anywhere.
• Weight: Heavier and larger packages add to the cost of shipping. Try to keep the package as small as possible and settle for the flat rate or standardised shipping rate.
• Distance: Another determinant factor differs between zones and domestic rates. Find zones specific to the location for carriers, which is often difficult.
• Shipping Volume: Just as you want loyal customers and high frequency, carrier companies prefer the same. When you ship significantly higher volume at once, you can negotiate the rate with the carriers. Shipping software is an excellent tool that makes the process easier with carriers. ¹
• Return Management: There will be returns and even the top-rated products can face it. Returns are the inevitable elements of eCommerce. But, how well you manage shall determine your success rate.

What Is The Perfect Shipping Charge?

Businesses, big or small, want to save money while still staying attractive and competitive to their customers. An appropriate choice depends heavily on the business needs. You may choose Free Shipping, Flat-rate Shipping, or Real-time rates.

Free shipping is the most attractive to customers. Amazon made this concept an integral part of our lives.

Several surveys and studies have pointed out that shipping costs are the main reason for cart abandonment. We also understand that you are bound to protect profit margins.

Whilst quick delivery is a popular option, customers want to wait for free shipping, which also means that you can choose cost-effective services. Further studies reveal that customers want to add some products to the cart to avail free shipping.

But, if you are not offering free ship, you could find an alternative at a flat rate.

With solid preparation and careful analysis of shipping costs, businesses can offer a decided amount entailing different services.

If you are shipping oversized items, B2B businesses, and specialised products, real-time rates shall be applicable. BigCommerce dealers can create their real-time quotes, having a lesser risk of charging more or less for shipping.

5 Ways For Small Businesses To Save Money While Shipping

Here are some handy tips to help small businesses create an efficient as well as low-cost shipping service:

#1: Research Multiple Carriers

You have to research cost and allied factors with different services and carriers. Just like visiting many dealerships before buying a car, you have to do some extensive research online, and wait till the time one seasonal sale is done to complete buying.

Do your research online and understand available shipping options; connect with services and carriers to build a bond, and negotiate the discounts or activate hybrid shipping techniques using door shipping, 3PL or in-house services.

#2: Shipping Automation

Shipping software saves time and money.

When you automate shipping, the best rate is guaranteed. You would also free up your workforce so that you can spend some more time on marketing strategies and online skills.

#3: Minimum Order Free Shipping

We understand that you may not be prepared to dive into the vast field of free shipping. However, if you are a small business, it is essential to aim for success, not margins.

The most cost-effective strategy of offering free shipping is a combination of a minimum value of the order. Here, you can also do A/B testing and understand the value threshold that is moving the needle for customers. Determine that amount.

It will not only save shipping costs but you can also learn about customers and factors driving conversions.

#4: Leverage Flat Rate Shipping

It is difficult when a particular order containing one product is shipped for the same price as an order containing five products.

Based on the value of average order and items, you can also consider leveraging a flat rate.

The best thing – you need not bother about the boxes or visiting the carrier.

#5: 3Rs

If you have a good initiative, customers may be interested. The 3Rs in the business is to reduce, to reuse, and to recycle. However, reducing the shipping material can create massive business savings.

There are unique ways of giving back to this planet and saving some big bucks too. For instance, you can use software to automate your shipping management. You can also use it to order supplies. Overall, this can reduce your total inventory and you will save a lot.

Moreover, you can reuse the shipping material acquired from the returned orders, but only if these are in a good condition. You can also find a recycling centre locally to take the recycled materials and distribute the same.

Finally, you can encourage your customers to reprocess the shipping materials. Use some nice pictorial ads demonstrating the same in the packaging materials.

Final Word

Small businesses should mainly emphasise creating customer-centric and cost-effective fulfilment experiences to drive loyalty, retain customers, and repeat conversion. Do not consider shipping to be the centre of costs for a business. Consider it a mere extension of the brand as well as customer experience. If you do it well, you can transform shipping into another competitive advantage that can help you grow as well as scale the business.