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With the huge shift to online purchasing, savvy consumers often expect free shipping. However, when you offer this, you’ll be increasing your costs for packaging and delivery, while still under pressure to keep your pricing competitive.
Add shipping as an extra, and customers may feel that the final cost of your product isn’t what you originally claimed, and go elsewhere.
From any angle, keeping your shipping costs as low as possible will benefit your business and protect your profit margins. What are some of the things you can do to save money?
1. Select Regional Delivery companies
When most of your customers are based in your country or state, it makes sense to partner with a smaller, more local company. They may be more flexible and able to respond more quickly, with faster collections and drop offs, without loading on excessive charges for same or next day delivery. For example, a company such as Texas Couriers can not only deliver across the state without the need for the package to go through a central distribution center, they’ll also regard their clients more as partners than as one of thousands of other customers.
2. Use Shipping Software
When you have deliveries farther afield, you may want to use your regional courier, or search for the lowest rate available. There are various sites, such as ShipGooder, Parcel Monkey and FitShipper which allow you to compare prices, so you can constantly evaluate where to obtain the most economical rates.
3. Negotiate
If you’re working with a local company, keep in mind that in every partnership there’s room for negotiation. Once your business relationship is established and the delivery company can see how much business you can bring them, they may be willing to negotiate preferential rates to keep your business, which can substantially reduce your costs.
4. Packaging
When did you last reconsider your packaging? While you need your products to be adequately protected while in transit, could you find ways to redesign it, reducing cost and waste. Consumers are increasingly concerned about unnecessary plastic packaging, so by finding alternative solutions, you have the opportunity to minimize your environmental footprint and enhance your brand image.
5. Buy packing materials in bulk
You’re always going to need them, so consider bulk buying your packing materials you do use to obtain bigger discounts from your suppliers. As long as you have adequate storage space, this will avoid delays due to shortages of material, and reduce labor time spent receiving and organizing it.
6. Reuse materials from goods received
Another consideration in terms of packaging – how do you handle the waste from the goods you receive? Airpillows, cardboard stuffing, polystyrene packing chips and sheets – do you re-use them? Could cardboard boxes be reused instead of being flattened and disposed of? In summary, reducing shipping costs can have a major impact on the growth and profitability of your business, so exploring all options is essential. As the key objectives of every business owner are to increase profitability and maintain customer satisfaction, optimizing packaging and shipping costs can help to achieve both.
