Shipping is a vital part of eCommerce, but many beginning online sellers don’t put enough thought into it. On the surface, it’s a simple concept — you put the sold item into a box, and mail it to the customer. However, there’s more to it than that, and it’s important to have a solid understanding of the ins and outs of the shipping process. If you don’t, you may find yourself unprepared, resulting in late orders and increased expenses, neither of which are good for your business.
This guide will introduce you to the complexities of shipping so that you’ll have a good foundation to work from. Part of growing a successful eCommerce business is being able to scale up as you make more sales, and this includes scaling up your shipping process. After all, more sales equals more items shipped!
To fully grasp the depth of the shipping process, you need to understand all the parts involved, e.g. shipping methods vs carriers, the meaning of “real-time shipping,” and more. This quick primer will help straighten things out.
Shipping carriers deal with the transport of your packages, and include companies like UPS and FedEx as well as the USPS or, if you’re not in the US, your country’s postal service. Shipping methods, on the other hand, are specific settings you create for your online store for shipping with any particular carrier. A good eCommerce platform integrates with several carriers and will allow you to create multiple shipping methods as required to fit the needs of your business.
Real-time shipping refers to an online store’s capability to instantly calculate shipping costs for a customer’s order. This provides a significant benefit because the customer is not surprised by the shipping costs, which can cause the customer to abandon their order. This is another feature you should ensure your eCommerce platform has available.
Drop-shipping is a business model in which the products you sell are shipped directly from the manufacturer or distributor to the customer, removing the need to carry inventory at your own location. Drop-shipping has its own set of benefits and challenges, and is not within the scope of this guide.
The term “fulfillment” refers to the entire process from receiving an order to packaging and shipping it. Some businesses do their own fulfillment, while others forward the order to another party (like a manufacturer, in the case of drop-shipping).
A markup is an optional amount you add to the price of shipping that must be paid by the customer. Markups are frequently used to cover overhead costs of handling and shipping a particular product, or to help offset the cost of supplies.
You can’t ship anything if you don’t have the means to do so, but fortunately the supplies you need are inexpensive and easy to obtain. In fact, some carriers can provide you with free packaging, which saves a lot of money over time. You’ll still need to invest in a few necessary tools.
One of the most important items you can have in your warehouse is a shipping scale. Shipping costs are primarily calculated around the weight and dimensions of the package, and you definitely don’t want to guess on either one of those measurements. Make sure you purchase a shipping scale that can handle the weight of your products. Scales for heavier items are a bit more expensive. You may even opt for a smaller scale for small, light items and a larger scale for your heavier shipments.
Tips for Weighing Packages
Size is just as important as weight when it comes to shipping, so you’ll need to measure all three dimensions of your packages: height, width, and length. A tape measure can handle a larger range of sizes than a ruler or yardstick and makes this much easier.
Tips for Measuring Packages
You don’t need to buy a special printer just for shipping labels; a regular printer is fine. However, you could choose to purchase a thermal printer, which uses heat to print and doesn’t require ink or toner refills. Thermal printers also print faster than others, which is helpful if you ship a high number of packages each day.
Some shipping carriers can provide you with free shipping materials: specifically, FedEx, UPS, and USPS all offer free boxes. You can also get discounted shipping supplies from dedicated online shipping retailers.
You’ll need to come up with a list of requirements for safely shipping your particular products. What sizes of boxes will you need? Are your products fragile? Do you need bubble wrap, air paks, Styrofoam peanuts, or anything else to protect the product during shipping? Should you toss in a silica gel packet or two to help keep moisture out? Does your product need to be in insulated packaging to protect it from high or low temperatures? All of these factors are important and will influence the size, quantity, and type of shipping supplies you buy.
You’re probably already familiar with some of the major shipping carriers, like UPS, DHL, and Federal Express, along with USPS if you live in the United States. Others include Canada Post, Australia Post, Royal Mail, and other regional carriers.
Generally, USPS, FedEx, and UPS are the most popular.
If you’re in the United States, USPS is a very convenient and effective choice, offering free pickup as well as free packaging supplies, online label printing, and a range of delivery speeds. If you’re just starting out and only sell a few small items a day, USPS is a fine choice. USPS also allows you to hide the amount you actually paid for postage, making it invisible to the customer, which is helpful if you need to mark up your shipping.
FedEx has advantages like discounts for delivery volume, so you can save money when shipping multiple packages, and they also provide services like redirecting packages or holding them at their location. FedEx also has a great reputation for timely deliveries, and even offers a same-day option (dependent on availability). If speed is a priority for you, definitely consider FedEx.
UPS excels at delivering large packages, and has the added benefit of shipping to over 200 countries. You can negotiate a reduced rate for shipping volume the same way you can with FedEx, and access extra services like Saturday pickup and delivery. A range of delivery timeframes are available and UPS has a great record of shipping on time. If you just want to use one shipping method for everything, UPS might be your best choice.
The “big three” listed above are not the only shipping carriers in the world— far from it. Other carriers include the international DHL Express as well as regional carriers like Canada Post, Australia Post, and the UK-based Royal Mail. Royal Mail also has an international delivery service called Parcelforce Worldwide, which you can think of as the British counterpart of UPS. Other smaller carriers exist around the world, serving specific countries or parts of countries.
Your choice of carrier should depend on the dimensions and weight of your package, its destination, and the time frame within which it needs to arrive. Fortunately you don’t need to commit to just one carrier; you can ship different types of packages through different services if necessary, or even offer multiple carrier options to the customer. Of course, the software you use to run your online store can limit your choices, so it’s best to go with a platform that doesn’t have this limitation.
You don’t need to let your shipping carriers dictate your shipping prices. Depending on your business decisions, you may want to offer free or flat-rate shipping to entice the customer or make things simpler for them. This is another reason why you should use an eCommerce platform with a lot of options available — so you can implement all the shipping methods you want to use.
Since shipping charges can add a substantial amount to an order total, free shipping is one of the most tempting things you can offer to a customer. However, keep in mind that the shipping is only free for them, not for you, and you’ll still have to pay to get the item shipped. If you plan to offer free shipping, you’ll need to recoup your costs in other ways, which may be challenging if your profit margin is already low.
Flat-rate shipping means you charge a single rate for shipping, which can drastically simplify things for the customer without forcing you to absorb all the shipping costs. This makes it another appealing option that reaches a middle ground between free shipping and normal shipping calculations.
In order to provide your customers with real-time shipping rates, you’ll need to connect your chosen shipping carriers to your online store. Ideally, this can be accomplished through a built-in integration between your eCommerce software and the carrier. A full integration lets you access other features too, like printing shipping labels directly from your online store’s dashboard and supplying tracking numbers to inform the customer about their order’s shipping status. Look for an eCommerce platform that has the capability to connect to shipping carriers in this way
Shipping software expands your shipping capabilities by providing additional features, like synchronizing your orders between multiple sales channels such as eBay and Amazon as well as your online store. Some shipping software also includes data tools to help you analyze your shipping solutions. Another benefit is that some shipping software companies have a partnership with packaging companies and can offer you a discount on your purchases of shipping supplies. ShipStation, ShipWorks, and ShippingEasy are three examples of shipping software.
If the idea of using shipping software appeals to you, there are a few factors to consider first. Some shipping software focuses on a single carrier, or only offers a discount on one particular carrier’s packaging supplies. You’ll also need to check if your eCommerce platform offers an app to connect your online store to that particular shipping software.
In order to have the easiest possible time shipping your orders (and therefore spend less time on logistics and more time running the rest of your business), you should look for an eCommerce platform that has built-in capabilities to simplify shipping for you. These include:
Tips for Weighing Packages
Shipping doesn’t have to be a pain. You can find all these features (and many more) in Shift4Shop, an online store platform built to give you as many eCommerce advantages as possible. If you use Shift4 Payments as your credit card processor, you can even get a completely free, unlimited account with all our features included. You'll be able to attract your customers with a top-of-the-line eCommerce website built to succeed.