Offering completely free shipping is becoming less and less popular. Cheaper shipping is and remains important for both you and your customer. After all, passing on the full shipping costs to the customer is not an option. So what can you do to keep your profit margin intact? To help you, we will list 10 tips for online retailers who want to lower their shipping costs.
How can online stores send cheaper parcels?
A frequently asked question in the field of e-commerce logistics is how best to achieve cheap shipping. Whoever you plan to ship with (the postal service, DHL, DPD or UPS), as an online store you just want to do so as cheaply as possible at home and abroad. These 10 tips will help you make that happen!
Tip 1: Cheaper shipping starts with negotiation
Each carrier uses a price schedule based on volume: the more parcels you ship, the lower the rate becomes. Many small online stores do not realise that they too can have bargaining power with carriers such as the postal service, DHL, DPD and UPS.
It’s always good to compare the cost of sending parcels before you partner with a carrier. Don’t be afraid to contact several shipping companies to inquire about their rates.
If you let them know that you are comparing carriers for cheaper shipping of your parcels and you expect your online store to grow, you may be able to get a better price.
Tip 2: Join forces with another online store
The more parcels you send per month, the lower the cost per parcel. Have you ever thought about joining forces with other online stores?
By purchasing shipping capacity together, you can qualify for lower shipping rates. Look at which companies are in your area and could benefit from working with you. This way, you can negotiate lower rates together from one account.
Tip 3: Have other companies pay the shipping costs
Do your products appeal to a specific target group? Then there are probably a lot of companies that would like to advertise and be visible to your customers.
You can actively approach these parties and ask them to sponsor some or all of your shipping costs. In return, you will add that company’s flyer to the package with every order from your online store.
Of course, it’s not a good idea to fill the box with advertising. A discount code, for example, gives your customer real value. Also make sure it doesn’t have a negative effect on your own brand image.
Carefully choose a partner company that fits your online store and just be honest with your customer. There’s nothing your customers respect more than a transparent company.
Tip 4: Be clever about the parcel size
Think carefully about the packaging in which you send your products. Sometimes it can make a huge difference if products can be sent in a smaller package (such as an envelope) instead of in a box.
For example, have you ever thought about a letterbox package or even regular mail? A letterbox package can be sent cheaply and, just like an ordinary parcel, it has a Track & Trace code. An additional advantage is that your customer does not have to be at home to receive the product.
Regular mail, on the other hand, has no Track & Trace code. But, if you sell relatively cheap products with a low margin, it can be a good alternative. Think of spinners or other small gifts.
In that case, keep your customer well informed about the shipment date because the customer cannot track the shipment. Also mention that the parcel will be delivered within 24 hours.
Tip 5: Reuse packaging material
Keep all the packaging material you receive yourself, because reusing boxes and filling material can save you a lot of money on packaging costs.
Especially smaller online stores can reduce shipping costs considerably in this way. You can even ask family and friends to keep packaging materials or see if there is a company nearby that throws away a lot of material unnecessarily.
Tip 6: Use an online shipping service
Arrange the franking and payment of your parcels online. Large carriers such as your national postal service often have an online shipping service that makes it easy to send a parcel.
Just specify what you want to send and to whom, and pay easily online. Then print the shipping label, stick it on the box, and hand over the parcel or have it picked up.
The advantages of online franking are that it is cheaper and that you, as a business customer, often qualify for volume discounts. It also saves you time spent queueing at the post office.
Tip 7: Purchase packaging material in bulk
When you buy large quantities of packaging material, you often get a substantial bulk discount. So look at the kind of packaging you use the most and, instead of ordering every month, consider buying a six-month supply.
This is another area in which it’s a good idea to compare prices from several companies (packaging wholesalers). For example, take a look at Rajapack.
And don’t forget to pack correctly! If you pack carelessly and your product gets damaged, shipping really becomes expensive.
Even if a parcel is insured, you will not be reimbursed if it is carelessly packed. Therefore, always tape boxes using the ‘H method’ and keep at least 6 cm between the box and the product.
Tip 8: Think in kilos
How heavy are your products, INCLUDING packaging? Too often, mistakes are still made when specifying weights. The weight also determines the shipping price of your parcel.
If you ship to service points, the maximum allowed weight is often 20 kg. For home delivery, it is usually 30.5 kg. Shipping your products in the correct weight class can save you a lot of money.
Parcels that are too heavy often incur an extremely high surcharge (such as a pallet surcharge) because a different shipping method is used. Weigh your parcels carefully to avoid surprises.
Tip 9: Ship to service points
Another possibility is to ship to a service point. Because multiple parcels are delivered to a service point, carriers can charge less for this shipping option.
The delivery time depends on which carrier you are shipping with, so shipping to service points via multiple carriers can be an interesting option. In any case, always let your customers make the decision themselves.
Customers demand choice in their delivery options, so it’s a smart strategy to let them choose what they want. Offer free shipping to service points or a few euros more for home delivery.
People will often still opt for paid home delivery but, since you let the customer choose, they don’t mind paying for shipping.
Tip 10: Compare shipping costs and send parcels cheaper
Would you rather not negotiate with carriers yourself or look for companies you can work with? Then we have good news!
At Sendcloud, we combine the power of more than 15,000 online stores and work with carriers such as DHL, DPD, UPS and Same Day Delivery.
This allows us to offer you competitive shipping rates and let you decide how you want to send your parcels. Best of all, you pay per parcel afterwards.
This way, Sendcloud grows with you. In addition, you automate everything from printing shipping labels and sending Track & Trace emails to processing your returns.
With Sendcloud, you can ship up to 300% more efficiently thanks to online store integrations and user-friendly software. Curious how that shipping works? Check out the ‘How it works’ page.
Do you have any tips for cheaper shipping? Let us know!