Shipping costs can weigh down any budget for your e-commerce company. With the right strategy, reducing costs in this area can be achieved. Here’s how:
Do your research
Often, shipping costs for most e-commerce businesses can be reduced with simple price comparisons. This might take a little time and effort upfront, but worth it to find the best deal. Cost is not everything. Remember, your business is based on customer satisfaction, so be sure you choose a carrier who is cost efficient and committed to ensuring your products arrive on time and in top shape. And, please consider tracking options. Customers love to track their packages!
Also, remember to factor in weight and size restrictions in your research. If you ship large products frequently, you may face additional fees. Smaller products are easier to assess in terms of costs and often a basic fixed rate.
Find the best option that works for customers and your bottom line
What customer doesn’t light up when they see FREE Shipping. The offer is a game changer in the e-commerce business. But you’ve just started your business and free shipping might not be the best option as you’re growing. The good news is most customers aren’t deterred by shipping costs. Many expect to pay some amount to get their item.
There are several options. If you’re uncomfortable offering free shipping for every purchase, consider limiting it to customers who purchase a minimum amount of items. Also consider offering a flat rate or break even in your expenses by charging what you would pay to ship the item. If your e-commerce business is on Shopify, there is a tool that enables you to offer customers this option.
Get smart about packaging
This process alone can weigh down your monthly budget. A great idea is purchasing materials directly from the manufacturer to eliminate third party rates or negotiate with distributors to get a price your e-commerce business can manage. Always look for ways to pack efficiently at the best cost. Maybe use boxes that can be resized multiple ways or opt for different packaging other than a box for shipping product.
Connect with the team at Rektio Accounting for your e-commerce questions.