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E-commerce in a saturated market with increasingly aggressive prices can feel like an uphill struggle. Still, you can maintain healthy profit margins and customer retention rates with an intelligently planned delivery strategy.
Some online small businesses take an easy, carefree approach to Shipping; their e-commerce platforms provide all they require for managing logistics effectively.
No single platform can simultaneously manage all aspects of e-commerce - logistics, CRM, ERP - perfectly. So start small; learning logistics will come naturally once your feet hit the ground! When the time is right to launch full scale.
Successful E-commerce business owners use strategic shipping options to distinguish themselves from their competition and increase profit margins.
Shipping strategies can be an integral component of differentiation; however, you cannot simply create one and then leave the rest up to chance - you must be fully committed to its implementation - both operationally and from a price perspective.
Coordinating various teams - marketing team to fulfillment team and beyond. - is required.
Creating your shipping policy should include more than simply offering options - all parties involved should understand their role and contribute accordingly.
Let's examine what components make up an effective shipping strategy and how to implement them together.
What Does An E-Commerce Shipping Strategy Look Like?
An e-commerce shipping strategy is a plan designed to outline how brands that sell directly to consumers will deliver orders online.
A successful shipping strategy includes making decisions regarding service levels, carriers, rates and delivery times, and refunds/returns policies to minimize shipping costs while offering customers a positive online shopping experience.
E-Commerce Shipping Process
Your Ecommerce business offers complete order processing solutions from receiving and processing to picking, packing and Shipping to their customer's door.
After receiving an order, your business should first check whether enough inventory is available to fulfill it, followed by checking customer addresses and any relevant details before picking, packing and readying items for Shipping.
Why Is Your Shipping Strategy Important For E-Commerce?
Establishing an efficient shipping strategy for online commerce is crucial to meeting customer expectations of reliable, quick home delivery.
Inadequate planning or execution could result in late deliveries or orders not arriving altogether - potentially decreasing customer loyalty. Planning out your shipping strategy to build trust with customers is essential to creating an e-commerce shipping plan and should consider the following:
How to stay competitive : Rapid delivery can be an integral aspect of online commerce, particularly if multiple vendors offer products.
They could fulfill orders quicker than competitors, distinguish themselves, and gain new customers.
I am managing rising shipping costs: Shipping expenses for online retail storefronts can quickly add up, with surcharges for peak seasons, large packages and residential delivery fees soon becoming one of the biggest expenses.
To maintain profitability on each order placed through an e-commerce business, shipping expenses must be managed carefully to prevent losing money with each shipment.
Give your customers the choice and flexibility they want : Shipping that fits all will fail to satisfy customers, with some opting for expedited or free delivery based on urgency or waiting a few days if available.
By providing various shipping options, customers have more freedom and satisfaction is increased as customers find one which best meets them.
Also Read: What is eCommerce, Types & How to Start an Ecommerce Business
How Do You Build A Shipping Strategy For E-Commerce From Scratch?
1. Understand Your Shipping Data.
Before altering your shipping strategy, you must understand where your money is spent. Shipping data provides valuable insights such as:
- Average shipping cost per order
- Average package dimensions
- Average delivery timeframe
- Average Number of Shipping Zones
- The address where orders will be shipped
- What shipping methods are the most/least popular
Your shipping data may reveal potential shortcomings: Perhaps orders are being shipped to multiple zones without need, or DIM weight is increasing shipping costs - in either instance, you can leverage this data to optimize your shipping strategy and improve operations.
2. Set Your Goals
Shipping orders is about getting them to their customers as efficiently and smoothly as possible. However, there's much more involved than simply transporting products from A to B.
Before creating your shipping strategy, you must consider what goals are at play. Are your main priorities to reduce delivery times, get better shipping rates or provide free delivery - or all three?
Goal setting allows your business to better comprehend what steps must be taken for its fulfillment - for instance, if one of its goals is reducing delivery times, it might need to expand and move to a different fulfillment center to decrease last-mile deliveries.
3. Free Shipping Is A Decision That You Will Need To Make.
E-commerce merchants face an intractable problem: Free shipping costs can eat into margins while restricting their options.
Yet, consumers expect it as part of their purchase experience, and 62% expect delivery within three business days - giving brands a distinct competitive edge that helps drive the business forward. Selecting whether to offer free delivery as part of your e-commerce shipping strategy is key.
Free Shipping should never be implemented as an all-or-nothing approach; for smaller merchants, it may not be financially sustainable to try to replicate Amazon's policy for Shipping for free; consider offering complimentary services selectively as opposed to as an overarching policy.
Implement a threshold for free Shipping. Setting a minimum order value qualifying for free delivery will help your business avoid incurring losses on orders with lower values while encouraging customers to purchase additional products to reach it.
Make free Shipping an exclusive perk for VIPs. Free Shipping may also be given as an incentive for them to buy more and qualify for better perks.
This can encourage them to do just that! Reward customers with free Shipping with conditions. Offering timed or specific item free shipping offers is an effective way of moving slow-selling stock while creating urgency among shoppers.
4. Reduce Shipping Costs
Optimizing shipping costs should always be top of mind regardless of the scale of your business's deliveries. Fuel surcharges, demand-based charges and particular packaging needs can wreak havoc with costs, ultimately leading to spending too much on parcel deliveries to customers.
These savings quickly add up, diminishing the revenue to invest in your business.
Here are a few strategies for keeping down shipping costs:
Reduce Split Shipments. A split shipment occurs when one package is broken apart into several smaller parcels for shipping purposes, as may occur if one fulfillment center doesn't carry all the required items for fulfilling an order.
At the same time, another warehouse fulfills part or all faster. It increases shipping costs exponentially, while customers may choose to get certain items sooner.
Watch your DIM weight. DIM weight is an invaluable pricing tool that considers both size and weight when pricing packages for Shipping.
A lightweight package that occupies more space in a truck or plane could cost more to ship; to reduce bulk and carrier costs more effectively, you should streamline packaging to streamline bulk.
Consider flat rate shipping as it allows for standardizing costs regardless of which zones an order crosses and eliminating surcharges due to peak seasons; also, ensure the packaging dimensions provided by your carrier fit your product perfectly.
Search out discounted shipping rates. Because their order volumes are too low, small e-commerce businesses typically struggle to qualify for wholesale rates.
Brands should take advantage of their 3PL provider's larger volume shipping services by teaming with them to secure discounted carriers by working together as partners.
Want More Information About Our Services? Talk to Our Consultants!
The Best Shipping Strategy For Your Startup
Running your business requires an effective shipping plan strategy at what must cost thousands.
Your team and you work diligently to attract visitors to your E-Commerce website, spending hard-earned dollars on marketing efforts and analyzing data.
But once they arrive on your page, customers show no interest and abandon their shopping cart without purchasing anything! What happened then? Your site remains, yet business has dried up completely - why didn't things work out this time?
Why do customers abandon their shopping carts so often? Shipping and handling. Your startup requires a significant dedication of time and energy to create the ideal customer experience for its target market, increase marketing budgets, and review business intelligence reports - but none of this addresses its core cause: Shipping and fulfillment.
Without paying attention, all these efforts could prove futile.
Shipping lies at the core of consumer satisfaction in today's ever-evolving eCommerce landscape, where customer expectations have rapidly expanded.
When conducted effectively, Shipping can help your products sell successfully to market; we are here to prepare you for success in the coming future.
Introduction
Experience with eCommerce heavily relies upon product delivery - Shipping can make or break your business!
Do you feel like your brand has lost control during the shipping stage? With careful analysis and planning, there may be more room than expected for intervention regarding Shipping.
Selecting reliable courier services in India that offer timely deliveries at competitive rates can be challenging. Yet, professional courier services provide services across different areas, local, regional, national or global.
Implementing an efficient shipping strategy for e-commerce can be the cornerstone of company growth. Many brands begin in this arena by taking an accessible approach - like offering free Shipping or showing unmodified rates - towards shipping strategies for their orders.
Why Does Your Online Store Need A Shipping Strategy?
Are You New to E-commerce and View Shipping as Just Delivering Orders Online? Think Again! Shipping adds tremendous value and establishes trust between online sellers and shoppers by adding convenience, savings, and an enhanced experience for consumers who make online purchases.
Your eCommerce shipping process should be as streamlined and hassle-free as possible, whether starting from scratch or growing through multiple channels.
Set aside enough time for researching or creating your shipping strategy. Set goals that focus your efforts and software that makes the final step of the order fulfillment process more efficient.
No single approach works perfectly when it comes to e-commerce delivery strategies; your ideal approach depends on factors like audience size, budget constraints and margin expectations.
Establishing an effective shipping strategy for your business is of utmost importance, which is why we have put together this guide to assist with making an informed decision about shipping solutions for you and your team.
Shipping Strategies For Your Online Store
You can use the following tactics to improve your shipping strategy.
Make Shipping Policy Transparent
Be sure to clearly and openly outline your shipping policy on your E-Commerce website; this can reduce confusion for customers and enhance brand image.
By including details such as rates, carrier services and zones - such as their cost - in this tabular list, you can gain their trust as customers will see your transparent approach to business operations.
Free Shipping
Free Shipping can be an attractive incentive to encourage customer purchases, yet shipping itself doesn't come free; someone still must cover its cost.
There are ways you can make free shipping work successfully:
- Customers pay for Shipping.
- You pay for the shipping costs out of your margins.
- You and your customers will pay some shipping costs.
- Offer a specific customer a coupon for free Shipping.
- You can also offer free shipping if you have a minimum purchase amount.
Increased order size may help offset shipping costs with this strategy; however, you will still have to cover expenses from your margins.
Set Your Shipping Costs Based On Item Weight Instead Of Cost.
Why am I charged by my courier based on weight rather than cost? Our customers will be subject to courier rates to determine this cost-effectively.
When considering product weight for its shipping rate calculation.
Provide Regular Delivery Updates.
Customers eagerly anticipate receiving their products. Sending out regular delivery updates keeps customers up-to-date about the status of their delivery package.
- Sharing these updates with customers will enhance their experience.
- Send text updates directly to their mobile phones as part of email correspondence.
Even if they're disinterested, not sending it will leave your customers wondering about the status of their order, and it is, therefore, essential that they can easily track it.
Get The Shipping Rate Combination
You may select multiple shipping rates based on the total order amount or products at checkout if you cannot offer free or flat-rate Shipping.
As an example, consider offering free Shipping when your products have high-profit margins; create tabs to charge a nominal shipping fee (e.g., Rs 150); offer free Shipping when the order total is below this figure; create tabs according to the analysis of products and profit margins.
Focus On Skus When Shopping
Finding shipping rates based on product size and weight may appear straightforward, yet many small businesses underestimate its complexity.
eCommerce owners frequently neglect this step because they are overwhelmed with the options available.
Offer Several Shipping Options
The online market has transformed over time. No longer does it resemble its former state; therefore, you must stay abreast of changes within it and remain aware of your competition, whether from rival stores or through shipping options and delivery methods such as superfast express deliveries for those customers who require their product right away.
Your company can charge more for services that customers require; your shipping partner must be capable of meeting this challenge, or you risk alienating existing ones forever.
Consider leading shipping services like FedEx DHL Blue Dart for this task; these options offer various shipping and price plans, which you should choose according to what best meets your business's needs.
An effective e-commerce delivery solution is vital to the growth of any online store and can take your company to new heights of success.
Also Read: A Guide to Starting an E-Commerce Business
3 Important Shipping Conderations
Offering customers the right shipping options and rates is key to long-term business success, yet many feel as if their business is walking a fine line between losing customers if you overcharge and making enough profit if undercharge.
Offering appropriate options at just the right time will decrease cart abandonment while increasing revenue.
- Calculating shipping costs
- Packaging options for Ecommerce
- How to track your shipments and returns.
Calculating Ecommerce Shipping Costs
Before making decisions about shipping costs or setting fees to customers, it's essential that you know their exact value.
1. Size And Weight Of The Package
If your products are fairly uniform, using a zone-based per-item approach could be advantageous in terms of shipping cost and customer location.
Doing this allows the cost to fluctuate according to customer location rather than weight/size considerations and provides an easy-to-understand way of creating promotions such as $10 shipping for every order or $5 shipping for every item purchased.
Rectangular boxes can help if your product does not fit within standard rectangular boxes (like those seen on Amazon), so as to offer your customers the best rates possible by getting direct quotes from carriers such as UPS or DHL.
Assuring that your products are accurately measured is vital in getting an accurate rate from carriers. To this end, divide your items into groups.
Focus on gathering weight measurements from 20% of each group that contains the heaviest items for more precise weighting results.
2. The Origin Country And The Destination .
Do You Serve Customers in Canada and/or the UK? Do You Sell to Customers in the UK and/or Australia as Well? Do Any of Your Orders Come From America, Or Are They Shipped directly from Australia/UK to the USA Whatever the circumstances may be, your situation will influence which shipping strategy would work best for your online store.
Shipping domestically is simple. Shipping within the U.S. can often be more cost-effective with flat rates or free delivery services available.
You may wish to set rates by zone. For instance, in Austin, Texas, it might make sense to set lower rates in nearby neighborhoods while increasing them further outward.
To get an estimate from the Postal Service or DHL, for example. Rates between neighboring nations can differ significantly, and it can be hard to accurately calculate them yourself.
E-Commerce Packaging Options
Your product presentation at your customer's doorstep embodies your business in tangible form; therefore, it is crucial that you consider multiple factors before doing so.
1. Choose Your Packaging.
Be mindful of your items' fragility, how the contents will settle or how you plan on opening the package. Fragile products often need extra padding in their packages, while temperature-sensitive or perishable items require even further special considerations for Shipping.
2. Custom Packaging
Custom packaging will set you apart from your competition and add to customers' unboxing experiences, creating lasting memories with them.
Customization doesn't need to be dramatic: simply incorporate your company logo or add custom stickers for wrapping the products with tissue paper for an effective presentation.
3. Eco-Friendly Packaging.
E-commerce services has made tremendous advances for people all around the globe, providing new access to opportunities that previously weren't there.
Unfortunately, Shipping can generate wasteful emissions; you should consider including eco-friendly elements in your Shipping, such as compostable mailers or biodegradable packaging. It may be especially important if eco-friendliness holds great meaning to your brand.
Tracking Ecommerce Returns And Shipments
Shipping may appear simple at first glance; it simply involves transporting packages between customer and carrier.
But in truth, the process can become significantly more involved when customer satisfaction is at stake. From the initial purchase of a product through order fulfillment, Shipping, delivery and returns process, if applicable, customer experience should always remain positive.
1. Order Management.
Order management involves receiving, processing and fulfilling orders efficiently. With an efficient order management system in place, you can reduce errors while decreasing inventory problems and consolidate all important data in one location to streamline back-office operations while making data-driven business decisions.
2. Why Tracking Packages Are A Necessity.
Not only should your customers always know the location of your shipments, but so must your team! By offering customers tracking codes so they can monitor the Shipping of their package(s), regular updates about its arrival will set expectations correctly while building relationships between team and customers alike.
Your customers will appreciate this clear communication from your team!
3. Decide On Your Return Policy.
Customers' happiness should always be your number one goal when making purchases; however, certain products will always prove difficult to sell due to differences between computer screens and reality - it may become unavoidable that certain customers return them and sometimes there can be returns as a result of your mistake.
Knowing that your customers will be pleased with your return process is always satisfying, as your clients will remember the high-quality service you offered when purchasing something similar in the future.
Partner up with an expert logistics provider who can assist in creating your strategy and planning to ensure customer happiness!
Want More Information About Our Services? Talk to Our Consultants!
Conclusion:
Shipping presents one of the greatest obstacles for online sellers. Your unique challenges in Shipping may require extra efforts in terms of adopting new methods and keeping an eye out on what works well with your business.
Shipping is one of those activities which will take time and dedication to become successful at, yet will ultimately pay dividends in time.
Once your new shipping strategy has been put into action, each team should report back on its results and be ready to adjust when appropriate. Be patient; let the strategy run for some time in order to gather enough data before iterating further.
An effective plan takes time and consideration; if your case can stand up on its own, be open-minded enough to adapt along the way.
Once your shipping strategy has become an essential element of the customer lifecycle journey, Shipping should no longer serve only as the "final step."
