How to Minimize E-Commerce Shipping Costs
Freight expenses can make or break your bottom line. From inaccurate weights costing you more postage than necessary, to the expensive cost of shipping materials, it can be difficult to find the most cost effective solution for your workflow. Follow these tips to minimize your e-commerce shipping costs and increase your profits.
1. Automate your manifest system
Automation isn’t the future of shipping – it’s the present. The benefits of automating your manifest system are endless, but a few highlights include reduced labor costs, more accurate shipping, and finding the lowest freight charges.
When automating your system, consider what features are right for your operation. Automatic scales will improve postage accuracy and reduce overcharging. Automatic labeling devices can eliminate human error. Automated software can find the cheapest shipping carrier for each and every order. Sorting attachments can reduce time spent separating packages by carrier. Whatever components you choose, be sure they are compatible with your current warehouse management system.
2. Consider weight and volume
Carriers have become more creative in their pricing over the years. While weight was traditionally the final determining factor in your overall cost, volume has now become a standard consideration in pricing.
Consider the size of the product and the most appropriate shipping method that won’t unnecessarily increase volume. For example, if you are shipping a t-shirt, use a bag instead of a box. This change in packaging will reduce both your volume and weight to ensure you aren’t subject to higher shipping costs.
3. Make your packing materials in-house
Buying inflatable bags or paper padding from third parties can quickly add to your expenses. You can reduce this cost by manufacturing these materials in-house, on-demand.
From inflatable systems that produce air filled protective cushions or pillows, to paper packaging solutions that instantly turn rolls of kraft paper into protective cushions, a variety of cost effective and eco-friendly solutions exist that can help you lower your material costs.
4. Negotiate shipping costs
Most carriers are willing to offer lower rates to loyal customers or to new customers who present a compelling case. Start by doing your research and gathering information on rates from all of the carriers available in your area. Once you’ve figured out the advertised rates, it’s time to start negotiating.
Begin with asking for discounts on any extra fees charged by the carrier, including weekend delivery rates. Next, leverage competitor prices to see if a carrier is willing to meet or beat those rates. Finally, ask about discounts for bulk shipping. You’ll be surprised with the discounts you can receive simply by asking.