Low shipping costs are an important key to every e-commerce entrepreneur. They enable you to offer better rates to your customers, which can lead to more sales.
Unfortunately, many business people find this a daunting task and end up spending too much, which hurts their revenues. If this describes you, there are a few tips that can help you handle the shipping at ease and reduce the costs as well.
We will discuss how to get the best shipping rates for small businesses to help you understand how to go about the process.
Understand How DIM Weight Works
Unless you’re using the USPS flat-rate boxes, you’ll have to deal with the rules of dimensional weight. This can be very stressful if you’re new in shipping.
Dimensional weight, also referred to as volumetric weight, was introduced because packages with low weight and density were not benefiting the carriers. They occupy too much space and have a little weight, so the weight policy wasn’t working out.
DIM Weight is calculated here:
(Length x Height x Width) / DIM factor = Dimensional Weight
The DIM number is variable from one carrier to another.
The reason why understanding DIM helps in getting the best rates is that shipping packages have become very costly. Therefore it’s advised to use the right type of packaging to save on costs.
If the DIM concepts sound complex to you, don’t stress over it, carriers such as UPS and FedEx, have DIM calculation tools. You may want to use an international shipping calculator for sending items overseas.
Always Negotiate With Your Shipping Carrier
Unfortunately, the reason why how to get the best shopping rates for small businesses is still so frequently asked is many people don’t know it’s possible to negotiate with their carriers. Keep in mind that the carrier needs your business the same way you need them.
Do market research and get the shipping costs of different carries. Tell your carrier the offers you’re getting in the market and let them know the door is still open. You may end up getting yourself a very impressive deal.
The other way to go about it is to make carriers know they’re vying for your business. Give the carriers a rundown of your business and your strategy to grow, as shipping costs increase by volume. They might give you an incentive to keep you around for your company growth.
Don’t Lock Yourself in with One Carrier
Another great way to get the best shipping rates for small business is by using multiple carriers. It’s recommended you use each carrier for every order individually.
While this may seem time and labor-intensive, different shipping carriers offer drastically different rates based on destination, weight, and dimensions of your package. FedEx and UPS, for instance, charge a residential fee while USPS doesn’t and this difference can add up to a substantial amount of money with time.
By staying open to all these options, you’re able to cut costs and utilize all the good rates from different carriers.
Utilize All Your Packaging Options
The packaging fee is an extra cost for every e-commerce business owner. To cut down on this and lower your shipping rates, re-use any packaging you get. Packing peanuts, boxes, and bubble wrap can all be costly when you have to buy them frequently. But they can all be used more than once. Don’t shy away from asking your friends and relatives to give you any packaging materials they have.
The other trick that will help you lower your shipping cost is using the packaging your carriers offer. USPS, FedEx, and UPS all offer free bags and boxes.
Business people have been able to reduce their packaging costs by using the Flat Rate Boxes by USPS. If you go for such a package deal, don’t forget to negotiate as your business grows.
Audit Your Shipping Invoices
Many e-commerce businesses rarely audit their invoices, and they sometimes end up losing a lot of money. Shipping carriers have moments when they make errors and unless you’re on top of your shipping invoices you could miss it.
Auditing your shipments helps you evaluate the services you’re receiving. This can be a good negotiating tool for better rates as well as a way to get the carrier to improve its services. Auditing also enables you to claim refunds for any service failures.
Whenever shipping carriers commit any of the failures, they owe you money but they just don’t voluntarily hand you the money. You need to know they owe you and then claim it following their policies.
Find New Technology in Shipping
It’s essential that you know every new tech affecting shipping. You may still be stuck asking “how to get the best shipping rates for small businesses” while your competitors already discovered a way to get the best shipping rates.
Automation is already starting to play a role in the shipment process. Shipment tracking and automated parcel are slowly becoming part of the industry.
Reducing human resources in the shipping department can save on costs in your business, which is money you could use to grow other parts of your business.
Use Zone Skipping
If you ship large products, the dimensional weight and actual weight of your products can lead to very high rates. The rates are even higher when you’re shipping the packages into a different country.
Zone skipping means gathering all the packages going to a particular region and sending one shipment to the consolidator offering the services in the area. The consolidator takes up the task of shipping the packages from their distribution center, to all customers within the same zone. This significantly reduces shipping costs.
Although this doesn’t apply for express shipments, the money you save from zone skipping can help you cover the cost of express when needed.
Learn How to Get the Best Shipping Rates for Small Businesses
If you’re running an e-commerce store, they’re a lot of factors that go into making your business successful. You have to distribute your revenue evenly to cover everything from the cost of the advertisement to the shipment costs. This can be challenging at first, but once you figure it out, you can save so much money and give your customers a great experience.
If you still want more tips on how to get the best shipping rates for small businesses or any e-commerce related information, visit our blog.