How To Save On Shipping For Small Business

1. How To Save On Shipping For Small Business

Shipping is one of the many aspects of business that can swallow up a good amount of profits from any company. Large firms who have been in the game for the longest might still be able to minimise shipping costs for the most part, but the same cannot be said for their small-sized counterparts. 

Being new to any industry can be a challenge. It can be rather tricky for startups to understand how to save anywhere from a dime to a fortune on shipping costs. To help every small-sized firm out there, we'll go over the different methods to save on shipping for small businesses.

2. What Are Shipping Costs for Small Businesses?

As a small business, it's only natural not to be aware of all the things that add to the final shipping bill. We'll list all the things that shipping costs cover:-

• The weight of your package involved is the first thing taken into consideration.
• The volume of the overall package also adds to the final cost. The more space your package takes, the more you'll be charged. 
• The amount of time your package takes to reach the final destination also comes into play. For faster deliveries, you'll be charged more. 
• Fuel charges that carriers may have to face can also be added to the final bill. 
• Last is the dropping zone. The further you deliver a package from the point of origin, the more costly your shipping becomes.

This was a basic run-through of how shipping costs can be calculated. Of course, different companies have different ways of making calculations. However, the list above is an idea of what shipping costs can consist of generally.  

3. Why Should Small Businesses Save on Shipping? 

A common thing for many small business owners would be to question saving on shipping itself. How high could shipping costs go after all, right? A lot, actually. 

In fact, if not appropriately managed, logistics can eat up a large amount of any business's capital, no matter its size. Since small businesses may face fluctuations in cash flow, in the beginning, they must ensure they minimise the cost of every business operation possible. 

Logistics happens to be one of the aspects of business which can be controlled and assist small-sized firms in making better profits. 

4. How Small Businesses Can Curtail Shipping Costs 

The main goal of any eCommerce business is to maximise the net profit margin and sell as much as possible. Shipping costs eat up a big chunk of profits, which are significant for small businesses that would like to scale soon. 

Here are some ways any small-sized company can save up on their shipping costs. 

4.1) Give Offers For Free Shipping 

Firms generally throw the shipping cost at the customer during checkout, which is inevitably one of the leading reasons for cart abandonment. The solution? Offer free shipping! As a new business, we understand that you cannot afford to lose revenue on expensive shipping for your customers. 

However, a good solution is to create a minimum limit for all orders. For instance, you can state that shipping at your store is free as long as customers add $50 worth of products to their shopping cart. This method is effective for small businesses since it does three things at once: 

• Encourages customers to buy more and avail free shipping. 
• Reduce the overall cost of shipping. 
• Help store owners learn about their consumers better. 

4.2) Research Every Carrier

What do you do when you want to buy new clothes? You'll naturally visit different offline and online stores, wait for some seasonal discount, and purchase the high-quality ones that fit your budget. 

Treat your shipping carriers the same way; look at the different options you have available at hand, try and get in touch to build a good relationship with a carrier and even negotiate for discounted contracts. This is where you can even choose to implement different hybrid services or 3PL logistics. 

4.3) Automate Your Solutions 

Automation is one of the most significant revolutionary additions to logistics. Automation helps manage goods and orders at your warehouses, reducing labour costs and increasing delivery accuracy. 

You can use shipping software for small business and almost ensure that your logistic costs are minimised at once! Automated solutions can also take care of your supply orders to buy only the total supplies you need. Further, automated software can optimise your inventory, tracking, and last-mile. Overall, automation is one of the best ways to save on shipping for small business. 

4.4) Shipping Aggregators

For eCommerce brands, a shipping aggregator is one of the best ways to save money on shipping. Aggregators are basically the middlemen between you and shipping carriers. 

These companies usually tie up with more than one carrier, enabling you to look at different carrier rates at once. With an extensive range of pin code reach, lowered RTO rates and API integrations with various marketplaces, you can count on shipping aggregators to handle your shipping. 

At the same time, you can focus on marketing and brand strategies much more.

4.5) Reducing Package Weight

As mentioned earlier, the weight and size of your entire package play a vital role in the final shipping cost. Many new firms may make a common mistake of not paying attention to the product boxes. This means that all products, regardless of their size, get shipped in one standard sized package. 

However, you should know that this only adds unnecessary volumetric weight, which could be avoided. As a small business, you can organise orders and only use boxes which correspond with the product's size. For smaller products, use small boxes and the same for larger items. 

At times, carriers can even provide extra discounts to customers for keeping their shipment weight lower than a certain amount. As far as supplies like bubble wraps, you can add them too, but you'll have to ensure that you do not add too much to avoid any extra weight. 

4.6) Look Out for Cheaper Rates in Different Regions

This works only for small businesses that ship internationally too. If you ship on an international scale, you should first research the shipping rates in the regions you wish to expand to. 

Start by delivering only to countries with the cheapest shipping rates. You can ensure to increase the number of sales while keeping your overall logistics costs at a low level this way. 

4.7) Reuse and Recycle 

The traditional method of reusing and recycling never fails to work. In this case, you'll want to reuse the different supplies you receive from returned orders if they are still in good condition. You can also find a recycling centre that accepts shipping materials. 

Doing this to a certain extent can be a must for all brands to prove to all customers that they're willing to give back to the environment. This method is great to build brand reputation and save on shipping for small business. 

You can even ensure that there is no wastage in packaging by cartonization. Cartonization is a simple process which enables you to figure out the best and most efficient way to pack an order. 

4.8) Manage Your Returns

One of the ways firms can lose a decent amount of revenue is by not having a sound system for returns. The entire cost of delivering the product in the first place, picking it up and getting it back to the warehouse can be expensive, especially for small-sized firms. 

While returns are inevitable for every business, bad experience isn't. You can set up a self-serve portal for your customers to place their returns on their own quickly to create a healthy return experience for them. 

In fact, you can also add a feedback form to inquire about the reasoning behind returning the product to understand your shortcomings and serve better in the future. The good thing about managing returns is that it can help consumers place their trust in you after a good return experience. 

4.9) Implement Flat Shipping Rates

This strategy depends on the value of every order and items per order at your store. You do not have to go through the hassle of purchasing boxes. USPS allows you to order boxes in packages of 10 to 25. 

These can also be auto-scheduled online. Flat rates in shipping work best when you're faced with conditions when shipping a single product costs you just as much as an order that contains five products. 

4.10) Negotiate Prices

If you partner with a carrier directly, there's one thing you should know- they like repeat customers just as much as you do. Suppose you have a good amount of orders rolling in every month. 

In that case, you can negotiate the overall cost with your carrier and even create a good relationship moving forward. You can look into several carriers and work with each one for different purposes to make the most out of their services. 

Carriers can even offer free packaging at times. While negotiating costs may not work with every carrier, it is one of the best ways to save on shipping for small business. 

5. Conclusion 

To wrap up, reducing extra shipping costs is crucial for small businesses to widen their profit margin and build their base. Also, high shipping rates can be a dealbreaker for most customers. Hence, small companies unknowingly lose consumers in this way. However, it's vital to ensure that the packages are delivered safely on time.