Shipping is an essential part of any e-commerce business. Clear shipping policies make it easy for the customer to work out the final price of their purchase and it also allows the vendor to plan their business effectively with no nasty shocks arriving at the post office.
So, while shipping is essential for any business, it is something that people starting out in e-commerce need to really laser in on and ensure get it spot on, particularly if you are hoping to sell products in volume. If you get the pricing wrong on a single item you may lose a few pennies. Get it wrong on an order of 200 and the implication is going to be that much bigger.
Flat Rate Shipping Options
However, flate rate shipping can be a great way to manage your shipping options.. For example, while pricing for shipping single items may involve weighing each one and calculating shipping individually, it may be that flat rate shipping boxes (these are boxes where the shipping rate is the same, regardless of the number or weight of items that are included) are a great alternative. It takes the guesswork out of shipping costs. Of course, this will vary by product and won’t be suitable for everyone. A flat rate shipping box may be overkill if you are shipping a single nose stud, however if you are shipping 100 of them, it suddenly becomes more attractive.
The advantages of flat rate shipping is that you can relatively easily work out how many products each type of box will take and therefore create a straightforward shipping policy for your store. For example you could set up shipping for up to x number of your products as x$ and over x number at a different rate.
Here’s a list of some shipping companies that offer flat rate shipping:
- FedEx International
- USPS Flat Rate
- USPS International
- Stamps.com Have special rates including flat rate
- UK Royal Mail – Information on shipping parcels, no flat rate shipping as such
- Canada Post Flat Rate
- Australia Post
- Correos (Spain)
Flat Rate International Shipping
Not all shipping and postal companies offer flat rate international shipping, so you may need to research this further if you plan to ship internationally. As an alternative to flat rate shipping, companies which offer a brokering service (where they secure good deals for their customers) are certainly worth investigating. An example is Parcels To Go.
Personally, while I don’t like the term ‘free shipping’ (because unless the shipping company is delivering for free, there’s obviously a cost to be absorbed somewhere – whether it’s by increasing the cost for the customer or the seller paying the shipping out of their profits), it is a term we all know and love – and it’s a powerful marketing tool.
Free shipping (or ‘shipping included’) is a great option. It is easy for the customer, it gives the customer the feeling that they’ve got a bargain and it’s relatively straight forward for the seller as they don’t need to work out lots of different shipping scenarios. However, free shipping will only work if your products are costed correctly. Get it wrong and a large chunk of your profits could be going to the shipping company. However, flat rate shipping should make calculating shipping costs easier.
Strategic Use Of Free/Reduced Shipping
Free or reduced shipping can be used as an incentive. For example offer free shipping on orders over $x or reduced shipping for orders of more than x items. This is a great way to encourage shoppers to increase their total shopping cart value. It is best to get some sales completed first to understand what the average order value is, then, offer free shipping on all orders X% greater than your average order amount to help increase your order value.
Insuring your products is going to be essential. While you may be prepared to absorb the cost of a single item if it goes astray, the loss of several items will have a significant impact. Most shipping services and postal companies offer their own shipping insurance. You will also find that third party companies such as Ship Insurance are also worth a look.
International Shipping – Duty & Taxes
It is important to note that there may be duties and taxes to pay on international shipping. This is the responsibility of the person importing the goods (the customer). It is essential that this is crystal clear for the customer. While there may be no duty payable, depending on the country and value, there could be duty payable, therefore be sure to highlight this to the customer. An online duty calculator such as this one may be good to use as a guide.
Additional Customs & Duties Declaration Information
For more information on customs declaration and the required forms and policies, please see the resources below:
- USPS Customs & Duties Information
- Canada Post Customs & Duties Information
- UK Royal Mail Customs & Duties Information
- Australia Post Customs & Duties Information
- FedEx Customs & Duties Information
- UPS Customs & Duties Information
- DHL Customs & Duties Information
Shipping will be an evolving process. The shipping policy you have now is likely to change as your business grows and develops. Keep watching your shipping policy and see how you can change it to better suit the needs of your customer and your business.