Save Money on Shipping
“How to save money on shipping?” It can be the question that causes many a sleepless night.
Online shopping is a multi-billion dollar industry. Consumers love the convenience of it all, but more importantly, they adore the savings they experience when buying online. Yes, it is a fact, e-commerce statistics suggest that 50% of online consumers expect to find large savings online.
Translate this for online business owners and it means we have to watch costs, and our biggest expense is shipping.
This is the one task that can become a real love-hate relationship, especially when you see those shipping costs eating into your profits. Not to worry though. You don’t have to stress about shipping and you can be competitive, so long as you follow these 10 hacks to save money on shipping.
1. Don’t Lock into Using Just One Carrier
Ok, so you would never think of buying your clothes at a single store. You probably purchase books from more than one bookstore, and groceries come from a number of favored locations. The same holds true for shipping providers. The best way to save money when choosing a shipping company is to avoid using a single carrier. Instead, I recommend using a different carrier for each type of shipping you do. If you send large quantities of similar products, find a provider that works best for that product. Different shipping carriers offer drastically different rates, which makes it important for you to understand how shipping carriers base their rates.
Shipping rates are based on weight, dimensions, and destinations. However, some companies charge for dimensions alone and allow you to use any weight you need. Others, use all determining factors. services base their rates on the weight, dimensions, and destination of your package – and each company has different policies. USPS, for example, doesn’t charge residential fees whereas FedEx and UPS do. It is these little fees that add up over time.
When shipping things that are lightweight, your best option is USPS, better known as the postal service. If you ship larger packages then FedEx or UPS work well. Be sure to sign up online for either UPS or FedEx. You can print your labels ahead of time and get a discount of up to 50%. Even with a UPS or FedEx account, you can drop your prepaid packages off at the store. Keep in mind that it costs less to use FedEx and UPS to ship to a commercial address than it is to ship to a residential address.
2. Save Money on Shipping When You Use Zone Shipping
Zone shipping is the best way to ship something, especially if it is a large product. This service is a consolidation of shipping services where the shipper collects packages going to a certain region and sends one freight shipment to that zone. The shipping consolidator then reships the packages to the customer who is within the same zone.
3. Negotiate The Shipping Price
Yes, you can negotiate your shipping costs, especially if you are in the e-commerce industry. You can find ways to lower your shipping costs by becoming a GREAT NEGOTIATOR. Most small business owners are unaware they have this power to adjust the shipping costs. Don’t be afraid to negotiate with multiple carriers to see which company will give you the lowest rates. Because when carriers know they are vying for your frequent shipping business they will have an incentive to offer more competitive pricing.
Give Carriers a Heads Up
Explain our needs to carriers and give them an idea of the volume you have to ship. If your volume is growing, carriers are sometimes willing to give you lower prices. You also want to use the packaging offered by the carriers as this can help you save money. I often save more than 50% on my shipping costs when I use the boxes provided by the US postal service.
4. Ship By First Class Mail
Look into the cost of each method. Often your best bet lies with first class mail or USPS priority mail. First class mail is the cheapest and if your products qualify it is the best way to ship. For products that are small or even mid-sized this can be the best way to save money on shipping costs. However, this may not work well for large or irregularly shaped items. It is also not the best option for high-ticket items. In these cases, you might best look to FedEx or UPS for better solutions.
5. Use FedEx SmartPost or UPS SurePost
OK, guys, this is another inexpensive option. Check into SmartPost or SurePost by FedEx and UPS. In this service, you drop off the package at the carrier and the customer picks up at the final zone. It is the truck delivery to office or home that quickly add up the shipping costs so if you deliver and the customer picks up, you minimize these costs.
6. Use Priority Mail
I know I have talked about the U.S postal service, but I really must say the service is exemplary. I often decide to go with USPS Priority Mail because they get the product delivered within 2 to 3 days. However, I use the top loading A1 box because the weight limit is higher, at 15 lbs and can take a ton of different products.
7. Save on The Little Things Like Stamps
Use Stamps.com to print up your own stamps and save money. This company offers delivery confirmation and tracking numbers for free. Because you can print the stamps, Stamps.com offers discounted stamps and labels. Plus it gives you the added benefit of calculating the cheapest way of shipping your product. This feature can be a lifesaver for e-commerce businesses.
8. Reuse Packaging And Package Efficiently
Recycling is another way to save. I use recycled boxes to ship to customers. You can even save your newspaper for packaging or go to the newspaper printer and pick up the excess cardboard rolls that you can use as packing material. You might even search out a cardboard distributer and collect the foam and packing materials. These companies sell you a ton of packaging for just a few pennies on the dollar.
9. Pack It Up Well
My top tip for saving money on shipping is to pack your items as efficiently as possible. Use a shipping container that fits your product. Your products need to fit comfortably without there being a lot of space around the item. If this is not possible, try to take advantage of the flat rate boxes from USPS. A quick tip to take into account here is that the smaller you can make your mailing, the less expensive it will be. So if you are mailing an invitation or something like that, it may be best to have postcards printed for the cheapest shipping rate possible.
10. Do Not Pay For Insurance
Of course, there are exceptions. But when choosing a shipping option, consider your product and whether you really need insurance on the product. For instance, if you are sending a $20 t-shirt, insurance is probably overkilled. Over the years, I have shipped hundreds of thousands of boxes and I’ve only had 2 lost boxes. This means that the chances of a package getting lost are pretty slim. If the value of the item is low, you might just assume the risk yourself, otherwise, yes, you need insurance. Over the long haul, this tip can save you money on shipping costs.
The key ingredient that allows you to save money on shipping is to do most of the labor-intensive work yourself. Buy the packing slips and packaging materials online, drive to paper recycling plants and pick up enough packaging materials to carry you over for a while. Be sure you get a scale and weigh your packages before sending them out. Drop them off at the shipping location but before doing so, make sure you have printed your own labels and postage stamps or paid for the shipping online in cases where you use UPS or FedEx. Try to ship into zones and ask your customer to pick the merchandise up in the same zone. If your service goal is to offer products at a cheaper price your customers will often make a few concessions.
Is It Really Worth The Effort?
Can you afford to put this effort to save money on shipping costs?
The answer to this question really depends on the amount of product you ship. We can tell you that in this competitive market, businesses face a constant strain on their profits caused by increasing expenses. The running of your business, production costs, utilities, insurance and material costs continually rise. Competitive pressure deters you from raising your product prices to cover the shortfalls. So the answer is to find ways to cut expenses without raising prices. Looking for new ways to save money on shipping is often overlooked. However, annual carrier rates continue to increase. Fuel costs skyrocket and this can cause an increase in your expenses. Some industry leaders believe this cost increase may be as much as 30% or more per year. So to answer your question. Yes. looking into making a significant effort to save money on shipping can make a huge difference on your bottom line.
We hope you save some money on shipping! If you need custom labels for your packages then give us a call!