As an online business, you have probably lost customers because the shipping costs were high. Even though you were tempted to lower the prices, you probably couldn’t do so, because you needed to protect your profit margin.
Ecommerce is not easy, and almost every online entrepreneur has faced a similar issue. But don’t worry; you can effectively reduce the prices to satisfy your clients while maintaining the profitability of your business.
Keep reading to learn more.
1. Consider Zone Shipping
Zone shipping is an affordable technique for transporting goods to the same zone. The carrier collects different individual items whose destination is the same.
Upon arrival at the common destination, the items are sorted, grouped individually, and then shipped to the individual destinations.
For instance, if the goods’ source is Ohio and the destination zone is Florida, you will accumulate all Florida items to be shipped together.
From there, they can be transported to the various parts of Florida depending on the buyers’ locations. There is only one trip for this technique, and this means that you can save on the back and forth costs for the initial shipping.
However, this method can only work for the less urgent goods that you can store for an extended period as you accumulate the others.
2. Utilize the Best Packing Practices
Packing is a key determinant of your shipping costs. Unless you want an experience-based packing, you can reduce your overall shipping costs using a few smart packing practices.
The first smart idea is to utilize the packaging services provided by your carrier. When you pack on your own, you will exceed the dimensions and your carrier might charge you more.
The carriers’ packaging is tailored to reduce costs, and you can save substantial amounts by utilizing the service.
Another smart packing idea is to use the smallest boxes possible so that the items can fill well. You might also consider the lightweight parcels which don’t add massive weight to the package.
Lastly, you can recycle your packaging materials to cut the costs of buying new bags every time. Recycling will not only help you cut costs but also reduce your garbage collection.
3. Ask Your Carrier for Discounts
You should have excellent negotiation skills for not only shipping but also for the other aspects of your business. When signing for a short term or long-term business deal with your carrier, ask them to reduce shipping costs for you.
Most carriers don’t have fixed costs. The fees are usually open for negotiations, and you can strike a great deal if you negotiate well.
In return, you may promise to become a loyal client and work with them for an extended period.
Before you negotiate, compare what other carriers offer so that you don’t demean your carrier’s services. Also, provide the right packaging basics, including weight, dimensions, and destinations.
4. Use Air Delivery in Urgent Situations Only
Air delivery is costlier when compared to ground delivery. To cut costs, you should only use it to transport perishable goods or items with urgent needs.
Otherwise, you will be wasting money by using air express to transport durable goods that are not urgent. Likewise, you may use FedEx or UPS ground services instead if zone 2 air express deliveries.
Always consult with the buyer before shipping. If they accept the ground delivery, then you will save a lot of money.
5. Use Third-Party Shipping Services
Third-party services can help you cut the shipping costs. They provide a wide array of shipping options, meaning that you can choose the fittest for your business.
Furthermore, since their work is to ship only, they have a rich knowledge of the shipping processes. They know many carrier firms too, and they can negotiate on your behalf for incredible rates.
The standard third party shipping services are aggregators that require you to sign on their platform before working together. You can track the delivery processes, and you can also get better deals if you become a regular client.
Note that many carrier service providers might require you to prepay to qualify for discounts. If you can, you should consider this offer mainly if you intend to transport similar items with the same weight.
6. Consider Flat Rate Shipping
The flat rate shipping plan provides a standard rate for all the deliveries you will make, irrespective of sizes or weight.
Besides helping you cut shipping costs, the flat rate tactic can win you more clients. The method is, therefore, crucial to new businesses that are still building their brand.
Your clients will be motivated to buy bulk goods because, after all, the shipping fee is the same. You can test this technique’s efficiency by identifying a common area where you ship your products more often.
7. Educate Your Customers
The last important method for reducing shipping costs is to educate your customers. If you inform your clients on the shipping costs to expect, they will make informed decisions, and probably, they will not abandon the cart at the last minute.
Only 22% of online merchants mention the shipping costs on the homepage. Remember that buyers hate hidden charges, and the last thing they would like to know is that they have to pay specific fees.
So, if you offer shipping charges, these tips can help you reduce the charging costs:
- Provide a shipping calculator
- Create pick up points for your goods to cut the transport costs and avoid inconveniencing your buyers
Be transparent with your customers on how to transport the goods. Discuss everything, too, so that you won’t have to incur extra shipping costs covering up for information you didn’t provide. In the long run, you will win your clients’ trust while still lowering the costs.
Reduce Your Shipping Costs Today!
As an online merchant, you should try the strategies which give you a competitive advantage. One effective strategy is to reduce the shipping costs to attract more clients without affecting your profitability.
So, follow the above tips and adopt others that promise lower shipping costs.
Find more informative guides like this one from my blog. Besides business, you will learn more tech and lifestyle tips to apply in your home or business. Please read them to know more.