Ecommerce store tips: how to be upfront with shipping costs?

There is little doubt that shipping cost is the biggest part of overhead when it comes to cross-border ecommerce. In order to get the goods to your customers located in different countries, there are some steps can’t be skipped, domestic shipping, international shipping and customs clearance and final dispatch. To fulfill the whole process most economically, more control and optimization are required for inventory storage and transportation sections.

Besides, according to industry statistics, shipping cost is the NO.1 factor lead to shopping cart abandon. Online buyers are usually tend to place an order again if they have enjoyed a decent delivery experience from you before.

Then, how to slash ecommerce shipping cost without hurting buyers’ purchase willing and experience? There are something need to be done to optimize your shipping strategy.

Since shipping cost mainly consist of warehousing and transportation, ecommerce sellers should start with what contribute to reduce the cost of these two parts:

how to reduce ecommerce shipping costs

Select products wisely

The shipping fee is usually calculated by the goods’ weight and dimension, the slighter and smaller your products are, the lower the freights will be. So when researching products to sell, the small-dimension with high value products should be your priority.

Optimized warehouse layoutO

Optimize warehouse layout and reduce storage points to cut unnecessary fixed costs. Many enterprises, through the establishment of large-scale logistics centers, aggregate the sporadically distributed inventory in the past for management and distribute to customers within a certain range directly, which is an important performance of optimizing storage layout. What needs to be paid attention to is that the reduction of warehouse and the concentration of inventory may increase the transportation cost. Therefore, the layout of warehouse should be considered from a comprehensive perspective of transportation cost, storage cost and distribution cost to minimize the total logistics cost.

Reasonable inventory levelR

Leverage advanced inventory management system to control the inventory in a reasonable level. Thus minimizing the inventory level, space occupation and waste. Most order fulfillment companies like SFC have their own inventory management system to inform ecommerce sellers’ the real-time inventory level and what products turn over slowly, giving sellers’ more insights into product selection.

Improved packaging methodsI

Most sellers only use the weight their suppliers provide to calculate the estimated shipping fee, while the weight logistics company will charge you includes the weight of package material also. Take an example of a parcel weight 30g, the excessive or wrong packaging may incur its weight up to 50g. If it costs 0.08 dollars per gram, then the total shipping fee of this parcel increases by 2.4 dollars or more. Say a seller have 2000 parcels to be shipped out every day, then the daily shipping cost increases by 4800 dollars per day! It is highly recommended that sellers should avoid complicated packaging and use simple and slight packaging materials.

Long partnership with 3pl fulfillment companyL

Due to its large and steady orders volume, third party logistics fulfillment companies have priority to get shipping discount from couriers, in addition, they are capable of integrating all sorts of resources to develop diversified shipping options to meet different ecommerce shipping needs. For this, working with a fulfillment company helps sellers get a shipping discount otherwise they might hard to get it if ship through in-house fulfillment.

Work with experienced customs clearance companyW

Customs clearance is a very important procedure of the whole fulfillment process, if fails, not only the buyer’s receipt time will be delayed, more severely the logistics cost will increment. Therefore, when choosing logistics service providers, priority should be given to enterprises with rich customs clearance experience.

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