The cost of shipping is one of the biggest competitive differentiators in ecommerce. Customers will readily abandon a cart or buy from a competitor if it means they will save money on shipping. But if you want to reduce shipping charges for your customers without taking a hit to the profit margins of every order, you need to examine your shipping pipeline for ways to improve efficiency and/or eliminate unnecessary expenses. Fortunately, there are many strategies you can consider, such as:
Negotiate with your carriers
The best step you can take toward reducing your shipping costs over the long-term is to negotiate with your shipping or 3PL providers. Review your previous shipping bills to find the major cost driving factors, and research the prices from competitors to get a better understanding of average shipping costs. At Fulfillment Works, we pass 100% of our shipping discounts on to our clients, which allows them to give better shipping rates to their customers.
You can drive down your packaging costs by eliminating unnecessary dimensional space and excess dunnage. Examine your typical order sizes and order packaging assortments that suit them. Depending on your needs, custom packaging and kitting may be the best solution.
Remember to collect shipping refunds
Many shipping companies offer on-time shipping assurance as standard. As part of this benefit, you may be entitled to refunds on any deliveries that are delayed. If this kind of assurance is included in the agreement you have with your carrier, don’t forget to periodically review your shipping records and claim your refunds.