Keeping shipping costs low sometimes requires eCommerce businesses to get a little creative. Shipping rates are influenced by a wide range of different factors, so as a retailer, you should be prepared to plan your shipping and troubleshoot cost changes as they occur.
The key is research. Take the time to choose the right shipping solution, software, or carrier for you. It helps to choose a comparison example from your own products and compare pricing. Shipping software can do a lot of this for you, but you should still learn more about how shipping packages works.
With our guide, you can find small ways to save money and determine where it’s worthwhile to splurge.
Best Shipping for Small Businesses
Small businesses can cut their shipping costs and improve their margins on all products they sell. There’s no one right answer to which shipping solution is best for small businesses. Costs can vary widely — as can the amount of time and investment it takes to ship the same package.
Generally, businesses can save on shipping by choosing a low-cost carrier or automating part of the process. If you’re comparing carriers, it’s a good practice to start with the three big domestic carriers in the United States: USPS, UPS, and FedEx.
USPS vs. UPS vs. FedEx
These three organizations offer competing package delivery services. They are all roughly equivalent in terms of reliability and quality. Which one you choose may depend on things like personal preference and which retail location is close to you. That said, these companies can differ enough on pricing that it’s worthwhile to shop among them.
All three have particular strengths that may benefit your business. For example, when shipping smaller packages under 3 pounds or so, USPS often provides the lowest rates. A jeweler shipping small packages with high-value items may ship via USPS (with tracking and insurance added) at very competitive rates when compared with FedEx and UPS.
UPS has a single network for their shipments while FedEx uses subcontracting to expand their network. Both services are pretty close in reliability, but you may interpret one business model as an advantage over the other; FedEx has a wider variety of shipping options, but UPS has a larger ground fleet for shipping.
How to Save Money on Packaging
When you do start to ship, cutting costs on packaging may be worth your while. Packaging generally includes the cost of the cushioning materials and outer boxes or mailers.
To reduce your packaging expenses, consider these options and keep in mind that not every strategy works for every product and seller. These ideas may save you money, but you should ultimately do your own research.
- Use less cushioning inside the package for non-fragile items.
- Customize the packaging to your product.
- Combine multiple items into a larger box rather than shipping them separately.
- Choose the lightest box or mailer possible.
- Send a mailer instead of a box for non-fragile items.
- Hire a packing service through your carrier.
- Ask your carrier for advice on how to pack for the destination and the product type.
You don’t want your products to break during delivery, but you can probably reduce the packaging you use without running into problems. You will need to experiment a bit to learn how to pack your parcel carefully.
How to Pack Mailers and Boxes
Packing correctly requires that you take into account the type of item, the distance it will travel, and its expected condition on arrival (see below).
These questions are worth asking yourself before you pack:
- How do I want this item to look when it arrives?
- How much space do I need around my item?
- Will my item shift around during transit?
- How much do I need to fold this item?
- Is my item traveling with other parts of the order?
- Is there a concern with my product arriving wrinkled?
Much of this depends on what you’re shipping, so adjust this advice accordingly. As much as possible, you should minimize shifting inside the packaging and make sure your items don’t break others or damage details. If you are shipping a fragile item or an item with extensive decorations such as the fringe on a wedding dress, take care to ensure your product isn’t damaged in transit.
If you can, find cheap shipping rates and splurge a little on making sure your items are secure during transit. The savings you find on postage could make a difference in customer experience for your products.
How to Find the Cheapest Shipping Rates
Comparison shopping for the cheapest shipping rates doesn’t have to be a headache-inducing task, although it does require a small time investment. Thankfully, there are a ton of shipping rates tools readily available online. You can also check carrier websites for shipping quotes and information on packing.
As you shop, try to focus your search with one or two specific items. Comparing quotes for wildly different products won’t be helpful or productive. You could also make a list of your most frequently purchased products and create comparisons.
Comparison Shopping for Shipping Costs
While you compare costs, make sure you’re looking at similar features and that you set the same distance, destination, package size, and other parameters. Don’t forget to compare similar travel times.
If this all seems like a lot of effort, you can also use software to help with calculating shipping costs and handling logistics such as Table Rate Shipping for WooCommerce or WooCommerce Advanced Shipping.
Outsourcing Your Shipping or Using Software
The more you outsource, the more streamlined you can make your own shipping processes. The main tradeoff with outsourcing, however, is you do lose some control. The good news is, shipping carriers are increasingly providing more information and visibility. Even if you decide to outsource a large majority of your shipping process, you may not have to miss out completely on accurate information about your shipping.
Of course, shipping overseas can be more complicated and even having a single international carrier for the entire shipment can result in some added nuance. Finding cheap international shipping requires a bit of additional legwork.
How to Get Cheap International Shipping
International shipping is more expensive, but that doesn’t necessarily mean you should avoid selling to customers in other countries. Just like with domestic shipping, you can compare international shipping rates and look at multiple carriers.
Though international buyers most likely expect to pay a premium for shipping, finding the right shipping rates that won’t scare away potential customers is key. These rates can change quickly and depend on a variety of factors you don’t have to think about when you ship inside the country.
Your customers may also have to pay customs costs, sales taxes, and (in some instances) brokerage fees to receive your packages. You may be able to offset some of these costs to become more competitive with other sellers, but the added cost of shipping to another country can become a deterrent to buy.
Choosing the right international shipping carrier may not always mean finding the cheapest. Since there are additional processes involved with shipping to another country, it may be worthwhile for you to factor in the added effort when you compare your options.
How to Choose the Right International Shipping Provider
If you want to minimize the effort on your part, you may want to use an international carrier such as FedEx or UPS, or a freight forwarder. Although USPS can ship internationally, they use contractors for shipping outside the U.S. International carriers can transport your package the entire distance to your buyer. Freight forwarders can help you transport your package from one carrier to another, who can then take your shipment to the next stop. Using their own agents, they can manage the logistics issues on your behalf.
Shipping software can also streamline more of the shipping logistics process for you and help you comparison shop for the right shipping choices.
Best Cheap Shipping Software for Small Businesses
The right software for you may depend largely on how you use eCommerce software, your sales volume, and how you want to pay for a shipping software solution. Many software systems use per-shipment charges so you don’t have a monthly service charge to cover.
Take a look online at software reviews before you make your final decision. Here are a few platforms worth exploring to get you started.
Created for eCommerce businesses who use more than one platform to sell, ShipStation brings together shipping and tracking management information for retailers. This system also brings you significant savings on USPS and FedEx rates so you can cut your overall shipping costs. Using this software, you can reduce the complexity of shipping to many different customers through different platforms.
For shipping at scale, Shippo gives you great visibility into the shipping process and provides you with discounts from USPS and DHL Express rates. Shippo also has no fixed or monthly fees and charges a low rate for each package you ship. This makes Shippo a good option for startups that don’t have high sales volume yet but still want a robust shipping platform.
Easyship is a pay-per-shipment, cloud-based platform for eCommerce businesses who want in-depth shipping information, warehouse management, and quotes on shipping costs. Find information on freight, ground, air, and ocean shipping so you know more about what is really happening with your items.
Saving Money on Shipping While Providing a Great Customer Experience
Ultimately, saving money on shipping is only truly effective if your customers are still happy with your shipping.
Whatever method ships your items to buyers safely and on time will work, just as long as you keep listening. Don’t forget to include your customers in the shipping decision by soliciting regular feedback on the shipping experience. Some eCommerce retailers are tempted to minimize shipping to a point that products break, shipments go missing, or customers feel they’ve waited too long. Don’t let this happen to you. Convince your customers to reach out to you for a solution before they go anywhere else.
One great way to invite feedback is by providing an incentive. Consider giving a small discount or shipping upgrade to customers who take your customer experience survey, or give a bonus gift to shoppers who participate. Digital downloads such as a free eBook or checklist are freebie gifts you could offer that don’t add to your costs.
Keep your customers front and center and they’ll likely reward you with future sales. If you strike the right balance, you can save money and make your customers happy.