Setting E-commerce Shipping Rates for Your SMB

When you run a small to mid-sized business (SMB), setting e-commerce shipping rates can be a challenge. You want your rates to be low enough to keep customer satisfaction high while also maintaining your bottom line. Luckily, you don't have to face this daunting task alone! We've compiled a list of important considerations and money-saving tips to help you create an effective e-commerce shipping strategy that will keep both you and your customers happy.

What To Consider When Creating an
E-commerce Shipping Strategy

Required costs and overhead

It's no secret that SMBs need money to stay open. When setting your shipping rates, start by considering all the required costs you'll need to account for per shipment. Make sure to factor in the cost of packing materials, shipping services, credit card fees and customs/duties if you're looking to ship internationally. If you'd like to offer free shipping or flat-rate shipping options in your e-commerce shipping strategy, you may need to increase the cost of some of your products to account for the difference to maintain your bottom line.

Package dimensions

Shipping large packages? The more space a package takes up, the more it will cost to ship regardless of which mode you choose. Keep shipping costs down by using the smallest boxes possible for each of your shipments, and make sure to research any potential hidden costs or fees for oversized or oddly shaped packages before setting your shipping rates.

Delivery destinations

Carriers typically charge higher shipping fees for longer distances between a shipment's origin and final destinations. If you're considering adding a flat-rate shipping rate to your e-commerce shipping strategy, you'll need to offset this cost on long-distance shipments. You may even consider a local pickup option for customers within a certain geographical area to further reduce your overall shipping cost.

Special shipping services

Looking to improve your customer experience while maintaining low shipping rates? Additional shipping services like tracking and parcel insurance come at an added cost but can greatly improve your overall customer satisfaction should a package hit a bump in the road on the way to your customer. Make sure to account for the cost of these additional services when setting e-commerce shipping rates.

Additional Tips for Reducing Your E-commerce Shipping Rates

Carefully package your shipments with proper supplies.

When sending e-commerce shipments, investing in the right packaging equipment (and shipping insurance) can actually help you save money in the long run. Keeping the correct sizes of packaging for your goods on hand will allow you to ship your packages quickly and securely, and without unused space that could unnecessarily raise your shipping costs. Plus, packing your shipments carefully can help keep them safe in transit, resulting in less costly claims.

Accurately weight and measure your packages.

Did you know that packages that have been weighed or measured incorrectly can lead to additional fees and charges? In order to get the most accurate shipping quote, avoid unexpected charges and keep your packages on schedule, make sure to accurately measure and weigh all of your shipments (including the packaging)!

Keep common fees and charges in mind.

Shipping can quickly become expensive if you don't plan ahead. If your package requires an address correction, additional handling, residential delivery or any other special services, you'll likely have to pay for additional fees. Familiarize yourself with common fees and plan ahead in order to avoid these sneaky costs.

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