Your success in the small business rests heavily on how you approach shipping, fulfillment, and returns management.

In the era of Amazon Prime, buyers expect their goods promptly and with an exceptional unboxing experience. They want a wow factor as soon as they open the box; what could be inside that would make them gasp?

To top it off, customers are requesting more transparency in the supply chain — putting fulfillment processes in the spotlight.

Most importantly, customers trust that they can return their purchase without any hassle if it does not meet their expectations.

Small business shipping is a core element of success, but with countless choices available today it can be daunting to identify which option works best.

Let us take the guesswork out of your decisions and provide you with all the information that you need to make informed choices about topics like shipping costs, return policies and processes, how much to charge customers for products/services, packaging & branding tips, creating a comprehensive shipping strategy as well as popular tools used in ecommerce shipping.

Shipping Cost

Before you establish any shipping fees and policies in your shopping cart, it's essential to comprehend how the associated costs of delivery and fulfillment are calculated.

Make the most of your expenditure by making sure that you get your items delivered quickly and without breaking the bank. Consider these factors when determining shipping costs: type of service, speed required, weight of products, final destination, and total volume.

Service and speed

Thanks to the prevalence of powerful companies such as Amazon, many customers expect quick delivery and a broad selection of shipping options — but here's the catch: they want it all for no cost.

Generally, the faster you need your delivery to arrive, the higher shipping rate it will incur. But other factors such as weight and size also contribute to your total cost.

Carriers provide a wide variety of services tailored to customers' needs, making it easier for you to get the perfect plan that caters perfectly to your preferences.

To ensure cost-efficiency in shipping, it is essential to correctly match the requested service with its corresponding delivery.

When it comes to shipping a product, ask yourself these key questions:

• When is the desired delivery date for this package?
• Do you need a guarantee of delivery or to commit to a specific timeframe?
• Is monitoring absolutely essential?
• Is the recipient's address a business or residential location?
• Do you need signature confirmation or any other additional service?
• Are you dispatching wine, other specialized goods, or any hazardous materials?

Gaining a more comprehensive understanding of your products' shipping specifications will give you greater insight into forecasting and determining the cost of delivery.

Distance

Ultimately, the distance between where a package is shipped from and its recipient's address influences shipping cost.

Trying to track down the exact shipping zones that apply to your location can be time-consuming and overwhelming. That's why utilizing a multi-carrier rate calculator is so advantageous - it helps you quickly identify what works best for your business, saving both effort and headaches!

If you have a global shipping need, here are some critical factors to consider:

• Ensure that your product is allowed to be shipped abroad. Various items are not permitted into certain countries; for example, Brazil doesn't allow playing cards and France prohibits collectible stamps from being sent within their borders. Therefore, it's imperative to confirm shippability before sending out any products overseas.
• Besides the typical carrier fees associated with international shipping, there are extra duties and documentation that come into play. This includes Value Added Tax (VAT), tariffs, as well as customs declarations to fulfill when sending packages internationally.

Ensure that you've taken the appropriate steps to accurately charge and estimate shipping fees for your international customers, as selling globally will be more costly. Make sure to update your delivery policy and cost accordingly.

Managing Your Shipping Volume

Just like you prefer returning, dedicated customers, so do shipping carrier companies. To ensure the most advantageous start to the relationship between your business and said carriers, create a strong bond with your account manager early on; this can lead to valuable discounts that will help streamline your shipments.

As most online retailers use a range of carriers to discover the best programs and prices for their operations, don't be afraid to investigate your choices.

Shipping software makes it simpler for businesses and consumers alike to quickly compare all carriers, rates, and services offered on a single platform.

Saving on Additional Shipping Costs

• Packaging: Carriers usually offer free packaging to their clients, yet it's also essential to factor in the cost of insulation and cushioning, custom boxes, envelopes and any other insert materials. Later on we'll go into more details about how to use effective branding with your packaging; for now just include all these costs when you calculate your expenses.
• Insurance: The majority of the leading carriers typically offer insurance at their standard service tiers, making sure your items are safeguarded.
• By and large, FedEx and UPS assign a default value of $100 to shipments; there are, however, certain exceptions.
• USPS Priority Mail Express guarantees up to $100 of coverage for every shipment.
• When you choose Priority Mail, your shipment is covered up to $50.
• Third-party insurance: If you require additional coverage, Shipsurance is a third-party insurance provider that offers competitive rates compared to carrier charges. Carriers usually charge between $0.75–0.85 per every hundred dollars value and have an approximate minimum cost of $2.50 while Shipsurance only charges $0.55 per each one hundred dollar value without any minimal cost!

Managing Returns

Despite being the most sought-after and highly praised commodities available, returns are an unavoidable element of running a successful online business. How you handle them is what will ultimately determine your success.

Are you aware that a great majority of customers research your returns policy before finalizing their purchase? After all, making an online buy entails more risk than buying in-store since there is no way to assess the product. Thankfully, providing them with robust return policies can help make this decision easier and guarantee they feel confident when spending on your products or services.

Having a customer-focused returns policy reduces this risk for the customer. When you offer a great returns policy and experience, shoppers are more likely to become repeat customers.

By providing their customers access to ShipStation's Branded Returns Portal, ShipStation users witnessed an astonishing 16% rise in average order volumes and 29% more likely for customers to patronize from the merchant.

A quick note for merchants selling internationally:

If you're in the business of selling to international customers, your returns policy must be obvious and easy-to-understand. International returns can prove costly and time-consuming, with potential duties or tariffs added into the mix. Depending on the value of what has been purchased, you may wish to grant a refund without necessitating for products to be returned back - or even offer an exchange as an alternative. Be sure that all information regarding this procedure is clearly outlined within your policy!

How Much Should I Charge my Customers for Shipping?

Now that you're aware of the factors affecting shipping costs, it's time to make a decision: how much will your customers pay for shipping?

Every business desires to cut costs while keeping up with the competition and gaining customers.

It all comes down to what your business requires, and you may opt for different strategies depending on the situation.

Free shipping

We can thank the age of Amazon Prime with its free two-day shipping for this occurrence, whether we find it endearing or not.

Numerous studies and surveys demonstrate that shipping costs can be a major factor for shoppers to abandon their cart. However, we understand your need to keep up with profit margins.

As new trends suggest shorter shipping times, numerous customers remain eager to wait additional days when they are given the incentive of free delivery.

By selecting more cost-friendly delivery services, you can save a considerable amount of money. Research has also revealed that customers are eager to add additional items in their carts when they get the chance to avail free shipping provided there is an adequate minimum purchase requirement.

For example, "Free shipping for orders over $75". By implementing this policy, you could markedly increase your sales numbers and the size of the average order.

If your shipment is less than 16 ounces, USPS First Class Mail has the most competitive rates. Beyond that weight limit, USPS Priority Mail provides some of the best prices for parcels up to 10 lbs.

The pioneering of Amazon has substantially altered the standard for customer delivery speed and cost. Consequently, brands must experiment with their costing strategies to incorporate a type of free shipping option that will cultivate genuine growth. Although buyers have paid additional fees for items with faster arrival time or “free shipping” (despite the fact that its full expenditure was already included in its price), Adam Grohs, Co-Founder/CEO of Particular says they are likely to do so again if given the same opportunity.

Flat rate shipping

If providing free shipping is not a viable option for you, then flat rate shipping could be the perfect solution. Spend some time analyzing your average cost of shipment to determine an amount that would work well for different types of services. With these figures in hand, you’ll have all the information necessary to offer customers convenient and competitively priced delivery options!

If your parcels are usually of the same size and shipping rate, this system works great for you. Even if there is a slight variation in rates from time to time, it all evens out in the long run as long as you have consistent shipping costs. Services like USPS Priority Flat Rate can help make this process cost-effective and streamlined too!

Real-time rates

If you own a business with large items, unique products, or deal in B2B transactions, this option may be especially attractive.

By setting up real-time shipping quotes through QWQER, merchants can reduce the risk of underestimating or overestimating delivery costs for their customers. Ultimately, this encourages consumer confidence and trust in your business!

Your Small Business Shipping Strategy

So far, we have discussed the key elements of your shipping process: how to calculate and set prices for delivery services, as well as how to use shipping and packaging in order to provide customers with a positive experience.

As you become more knowledgeable in shipping, it's essential to understand the order-to-ship process. Essentially, your business should be able to take orders from any and all of your sales channels while ensuring that they're shipped out quickly and efficiently.

1. Wherever you sell: multi-channel

Merchants can find success in selling on their own website or single primary channel, yet what will truly cause a significant impact is implementing a multi-channel approach.

Our research revealed a straightforward correlation: the more sales channels you add, the greater your success. Having access to multiple outlets increases buyers’ options and enhances overall customer satisfaction - resulting in higher sales figures for you.

Conduct market research and familiarize yourself with the advantages and disadvantages of e-commerce giants such as Amazon, eBay, and Walmart to identify a business opportunity that is perfectly suited for you.

Before deciding to become a marketplace seller, you must ask yourself if your capabilities are up to par with the stringent requirements and criteria of the marketplaces. Can you manage them?

Leveraging online marketplaces is essential for every business, but if you don't keep up with your shipping plan to regulate multi-channel orders, it can have disastrous consequences. It's important that you stay organized and informed when managing these channels in order to maximize success!

2. However you ship: multi-carrier

Just as it is important to diversify your order sources, broadening the range of shipping services you offer can be equally beneficial.

To identify the shipping solution that meets your business requirements, you should consider mixing and matching different carriers.

When it comes to selecting the most suitable shipping method, one must look beyond simply searching for the cheapest rate. Different carriers have their own individual advantages and disadvantages that should be taken into account.

By taking advantage of better delivery guarantees and improved insurance coverage from carriers, you can save yourself a great deal of money in case your deliveries arrive late or have been damaged.

If you strive to secure even more remarkable discounts, try shipping an estimated 10-30% of your packages through another carrier. Doing so will not only present the possibility for additional savings but also allow you to leverage multiple deals!

3. Outsourcing your shipping and fulfillment management

For the majority of small business owners, managing every aspect of their fulfillment process is a rewarding but intensive endeavor. This level of control brings numerous advantages to manage profitability and ensure customer satisfaction. However, it can be taxing to handle on your own.

Are you keen on extending your shipping and fulfillment operations? If so, two potential solutions include third-party logistics (3PL) and dropshipping. Entrusting a 3PL with the warehousing and order completion process can benefit any business. With that said, it's worth noting that taking this route does mean relinquishing some control over your product as well as incurring extra fees; however, for those companies who do opt in to using a 3PL provider will have their stock stored in an offsite location where orders are picked up, packed, then sent out - all without you lifting a finger!

4. Shipping Software

Imagine the possibilities of integrating a streamlined shipping solution - lower costs, increased shipping margins, and limitless growth potential for your bottom line. It sounds like a no-brainer!

For businesses of all sizes, shipping software can be a great asset in streamlining operations and saving time. Here are some ways it helps to make the process simpler:

• Consolidate your shipping needs into one central location with access to easy rate comparisons, order management tools, bulk label printing capabilities and invoicing reconciliation.
• Utilize shipping rules to automatically select the most cost-effective rate, swiftest method and much more.

Harnessing the power of shipping software can revolutionize your shoppers' experience, ultimately increasing conversion rates and solidifying loyalty to your brand.

How does this strengthen brand loyalty? With the aid of shipping software, your patrons can view exact and up-to-date fees when they check out. Furthermore, you may provide a variety of transportation alternatives for them to select from which would be ideal for their needs. By providing these services it will increase customer satisfaction while also reinforcing trust in your company.

Ultimately, the proper shipping software will save you valuable time.

If you're looking for the best software to use, make sure it offers robust integrations on both your selling channels and carrier sides, along with strong automation features that'll maximize efficiency. Additionally, support for essential tools like thermal printers, scales, and barcode scanners should be key requirements as well.

5 Ways Small Businesses Can Save Money on Shipping

Did you know there are still more ways to save your hard-earned money? From costs of shipping and return management, to utilizing the right technology - we can help maximize these savings!

Following these straightforward and cost-effective tips will help you develop an optimized shipping and fulfillment strategy that won't break the bank.

1. Research different carriers

Earlier in this chapter, we highlighted the relevance of researching the  shipping and fulfillment costs and facets connected with various carriers and services – to emphasize further how influential it can be on your initial expenditure.

Much like buying a car, you should take the time to search around multiple dealerships, research carefully online, and even wait for seasonal sales before finalizing your purchase.

Consider your shipping solution in the same regard.

To boost your shipping operations, dig deeper into the available options by researching and looking at guides such as this one. Don't forget to build connections with carriers in order to get discounts on contracts, or you can also consider a hybrid strategy of combining in-house services with third party logistics (3PL) or dropshipping solutions.

Devising a strategic blueprint for your ecommerce is vital, and this should be one of the first steps you take.

2. Automate your shipping

Utilizing shipping software not only gives you precious time back, but it also saves your company money in the long run. Automating this process ensures that you'll always receive the most competitive rates while allowing your staff to focus on other tasks such as marketing and website optimization strategies.

3. Offer free shipping with a minimum order

We understand if you're not ready to provide free shipping just yet. As an entrepreneur, the profits of your business must be never in question - and so we suggest a cost-effective way for you to offer free shipping with a minimum order value. A/B testing is a great tool which can help comprehend what exact threshold will work best for your customers; perhaps they would prefer orders over $50 or even $100 be eligible for complimentary delivery.

Establishing an order minimum threshold not only helps reduce your shipping costs, but it can also provide invaluable insights into customer preferences - helping you understand what drives their conversion.

4. Take advantage of flat rate shipping

It's disheartening to find out that shipping a single order with one product can cost the same as an order which includes five items.

If you want to maximize your profits and upsell more items per order, consider utilizing flat-rate shipping. With this option, depending on the average value of each individual item and number of items ordered in a single purchase, you can actually save money while increasing sales at the same time! One of the greatest advantages? You don't have to worry about buying boxes or visiting the post office. USPS flat rate boxes are available in sets of 10 and 25 when you buy them online, saving time by allowing for automatic scheduling.

5. Reduce, reuse, recycle

Your clients will be thrilled to learn that you are taking action to help the environment, and your business can reap substantial savings from reducing its shipping material consumption and carbon footprint. Luckily, ways are abundant for companies like yours to contribute positively towards our planet–all while saving money!

• Streamline your supply inventory by automating shipping management and orders with reliable software, allowing you to have only the amount of supplies that you require.
• Instead of tossing out your shipping materials from returned orders, if they are still in good condition you can reuse them. Another option is to locate a local recycling center that accepts and distributes recycled packaging material.
• Urge customers to repurpose their shipping materials, reducing waste and preserving the environment.

Let's get your e-commerce business up and running with shipping that is both efficient and profitable. We have outlined all the necessary information you need to know for a successful start.

Concentrate on engineering a budget-friendly yet customer-oriented fulfillment experience that will motivate customers to come back and purchase from you repeatedly.

Rather than viewing shipping as a cost-drainer for your business, look at it through the lens of how it can extend and enhance your brand presence. Investing in shipping could even potentially become an advantage that allows you to further grow and expand! Do things right and turn this necessity into something beneficial for both yourself and your customers.

Conclusion

Shipping may be a necessary evil for ecommerce businesses, but it doesn’t have to be a burden. With proper planning and efficient strategies in place, you can make shipping easier on your business and use it as an opportunity to add value for your customers. Ultimately, you should strive to create the most seamless delivery experience possible that meets both customer expectations and fits within your budget. Good luck!