Cutting Down On the Shipping Costs in eCommerce


IIH Global

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These days, people tend to make their shopping more convenient, that’s why the popularity of Internet stores and Instagram shops, in particular, is hard to overestimate. You don’t have to spend time in long queues to get the brand-new thing you can just pre-buy it online without a hurry. As clients, we look for an attractive price, good quality of the products, and comfortable terms of delivery. At the same time, to maintain their positions in the market, e-commerce companies are looking for new opportunities to make their cost and value proposition irresistible. The issues connected with delivery raise a lot of concerns, as sometimes it’s not possible for the client to get the final price of the product with shipment and immediately make a buying decision. Many small Internet shops face the problem when they easily attract the clients by the price of the product, its uniqueness, and quality, but fail to keep them involved in communication through the further stages of the funnel just because they don’t have a clear suggestion on the shipment cost.

So, if you want to sell online successfully, and keep your clients loyal and satisfied, then you should seriously analyze the existing shipment strategy and rethink the costs.

1. Analyze how you estimate the shipment cost

It happens that many companies provide a good price with the shipment. But end up with the serious losses, as they simply don’t take into account some extra costs and offer the conditions that are impossible to be provided without spending a couple of extra dollars on unpredicted expenses from their own pockets. If you plan a great sale for Christmas, be sure you aren’t the only company that has such plans, and, as it happens very often, shipment companies who cannot increase their working capacity might put an extra charge for the delivery. In such situations, they have to filter the general demand in the case of not changing facilities.

2. Choose local shipping companies

Remember that there is a very important difference between the strategies smaller and bigger shipping companies prefer. Big global players need to load all of their facilities, so in the case of holidays or weekends, they prefer to take shipping orders from bigger clients. In this way, they deal with a bigger number of addressees but a very limited number of senders. It’s more comfortable for accounting and operational costs. Smaller companies are eager to get some additional market share, so accept smaller orders and are more open to price negotiations.  That’s why don’t hurry to give your products to a big shipping company, analyze the market of shipping services and start with some local players. Being a small e-commerce company, you have much in common with them. You are looking for a stable safe shipment of your products. They are looking for clients’ loyalty, and, in the majority of cases, are more flexible and ready to offer you some special options to keep you satisfied.

3. Read more

It may sound funny, but not to make your own mistakes, it’s often better to learn from others’ mistakes and positive experiences. Search on the internet. You are not the first company in the world eager to cut the shipping cost. So, there are many life hacks in the open source to analyze and try to implement for your business. Think of the destination and the possible shipping companies operating on it. Then simply search for the cheapest way to ship to Canada, for example. Visit thematic forums, and on the base of the information collected, create at least three possible pilot strategies to try. Don’t be afraid to try new ways of shipping with small orders. It’s better to lose one small client at the beginning due to some shipping troubles than to lose all of them when you’ve just gained some significant brand awareness.

4. Trust needs time

If you’re trying a new way of shipping, which sounds interesting in the means of cost, but you’ve never done it with this shipping company, start with smaller orders. Here are two reasons. At first, as it was mentioned before, you minimize your risks. Besides, you can leave some space for further cost negotiation. When you’ve seen that in the means of speed, safety, and general quality of the services, the shipping company is just what you need, having more clients, you can make a better offer for a shipper and ask for some extra discount. As soon as you agree on the higher price and put everything on the table, you lose the opportunity to attract the shipping company for long-term cooperation and a possibility to bargain.

5. Always look for new opportunities

Stability is one of the crucial issues in any business, and e-commerce, which potentially faces even more risks, is not the exception. But as long as you have to monitor competitors regularly, analyze the market of shipping services with the same frequency. Make sure you always keep up-to-date. Don’t hesitate to negotiate with new-comers. Having a good backup of all possible shipping companies on the needed directions is the key to minimizing risks. On the other hand, when you initiate negotiations with a new shipping company, you introduce yourself as an attractive potential client. Don’t be afraid to take the first step, it will be appreciated in the form of discounts and nice business propositions.

6. Use hi-tech

Modern IT companies provide many ultimate shipping solutions for e-commerce. They will help you calculate the cost-efficient way of shipping and keep your customers satisfied with a good offer. They simply integrate with the main e-commerce platforms, such as Magento, Woo, and so on. On the other hand, if you are at the beginning of your way and just want to get a general idea of how much the shipping cost is, they will analyze and compare the main world famous carries, and show which one can be cheaper for your region and the chosen destinations.

7. Find Last-Mile Delivery Solution

Last-mile troubles are often encountered by transportation and logistics companies. Last-mile refers to the final stage of shipment delivery, and trouble at this stage undermines all the efforts in transportation before arriving at this stage. In the shipment handling and logistics industry, the last mile has often been regarded as the most crucial stage of e-commerce product delivery.

Ecommerce businesses should find logistics partners that invest in professional last mile delivery services. An effortless last-mile delivery system ensures zero hassle during the last-mile stage of shipment delivery. Nevertheless, the service can efficiently identify the challenges during the last-mile shipment delivery. An accurate assessment of the challenges helps logistics companies take the necessary measures to resolve those challenges.

So, what are the key features of the last-mile delivery service? Find those features at a glance in the following section.

  • Auto-Dispatch: Auto-dispatch saves time, as the process does not involve human intervention. The final-mile carrier companies can efficiently schedule shipment delivery through the auto-dispatch feature.
  • Smart Tracking: Tracking the shipment is essential to meet the deadline with precision. A last-mile delivery service uses a smart tracking system to track shipments for clients. The end-users can see the live location of the product in transit.
  • Optimized Route Planning: An efficient route plan can optimize final-mile delivery time. The final-mile shipment delivery service uses the latest GPS-enabled devices to find the best route to reach the receiver at the earliest.
  • Key Metric Auditing: A last-mile solution constantly audits vital metrics to ensure an effortless delivery service. Monitoring the key metrics helps optimize the product's delivery time with precision.

One solution to this problem is implementing a Cross Docking strategy, where products are transferred directly from inbound to outbound shipments, without being stored in between. This can reduce the time it takes for products to reach customers and improve overall delivery efficiency.

The final-mile delivery service makes the shipment delivery more efficient and transparent. The service also enables a tracking system for the receiver, and introducing such features drastically improves the customer experience. Besides interactive delivery experience, the final-mile delivery solution ensures shipment time optimization, which eventually increases customer satisfaction.

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