The growth of ecommerce has been nothing short of spectacular. With convenience at the heart of the modern shopping experience, online merchants face the challenge of delivering products quickly without breaking the bank. One of the main cost centers for ecommerce businesses is shipping. But fret not! Here’s a guide on how to lower your ecommerce shipping costs by incorporating different strategies, including understanding ecommerce fulfillment, leveraging FBA prep centers, and opting for order fulfillment services.
1. Understanding Ecommerce Fulfillment
Ecommerce fulfillment is the process of storing, picking, packing, and shipping an online merchant’s products to their customers. By streamlining this process, businesses can not only save costs but also enhance customer satisfaction.
- Bulk Purchasing of Shipping Supplies: Buy packaging materials in bulk. This can save you significant amounts of money in the long run compared to buying in smaller quantities.
- Use Efficient Packaging: Minimize wasted space in your packages. This can lower the weight and size, reducing shipping costs. Also, consider eco-friendly packaging as it can be lightweight and attract environmentally-conscious customers.
- Negotiate with Multiple Carriers: Don’t rely on a single carrier. By negotiating and comparing prices between carriers, you can secure better deals and ensure you’re getting the best rates.
2. Leveraging FBA Prep Centers
If you’re selling on Amazon, FBA (Fulfillment by Amazon) can be a game-changer. However, preparing products for FBA can be daunting. Here’s where FBA prep centers come into play:
- Cost Savings: FBA prep centers specialize in preparing products for Amazon’s strict guidelines. By outsourcing this task, you can avoid costly mistakes and fees associated with non-compliance.
- Time-Efficiency: Instead of investing time in prepping products for FBA yourself, utilizing a prep center allows you to focus on other crucial aspects of your business like marketing or product development.
3. Opting for Order Fulfillment Services
Order fulfillment services take care of the entire fulfillment process for you, from storing inventory to shipping products to customers.
- Volume Discounts: Many order fulfillment services have partnerships with carriers, which can result in volume-based discounts on shipping rates.
- Centralized Storage: These services typically store your products in strategic locations, ensuring faster delivery times and lower shipping costs.
- Technology Integration: Most fulfillment services offer integration with ecommerce platforms, allowing for real-time inventory tracking, automated order processing, and more efficient operations.
4. Offer Multiple Shipping Options
Providing customers with multiple shipping options can lead to cost savings. For instance, while some customers might want expedited shipping, others might prefer a cheaper, slower option. By offering various choices, you can cater to different customer needs without incurring unnecessary expenses.
5. Implement a Minimum Purchase for Free Shipping
Free shipping is an attractive proposition for customers, but it can be costly for businesses. One strategy to offset this cost is by setting a minimum purchase threshold. This encourages customers to buy more, increasing the average order value and potentially offsetting the shipping expenses.