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Deliver More For Less

Posted by Lucas Walker on
Deliver More For Less

Pitstop host Lucas Walker teams up with sponsor ShipBob to offer online retailers 5  helpful tricks and tips to save on shipping expenses.

A struggle all too familiar to every store owner, online or off, shipping costs can make or break e-commerce retailers both big and small. While the e-commerce giant Amazon can offer low-cost or even free shipping on most if not all of their items, the idea of any other Shopify or online retailer offering competing delivery rates is simply beyond unreasonable, and would soon sink even a successful business.  Thanks to their enormous profit margin, Amazon can afford to keep their rates low, that was then reinvested over years into building their own sorting, processing and delivery systems. The vast majority of other retailers however, even some of the larger companies, can't even hope to dream of expanding their operations to that scale, and have to balance their delivery rates and costs very carefully, to not dissuade customers or drain their own cashflow.

The shipping costs that customers see when ordering an item is the outcome of a delicate and intricate dance between the company's profit margin and what the consumer is willing pay for the convenience of ordering the product or service from them. While every retailer would love to see delivery costs on their end drop to zero, this would mean items and stock price would skyrocket for the consumer, with many products doubling in cost, or worse, should the full weight of the delivery-logistics-network be rested on their shoulders. Likewise, customers love free delivery, but this cuts a huge margin out of any retailer's profits, and sometimes even deeper if allowed to run rampant.

That's why Pitstop sponsor ShipBob has come up with list of tricks to help any online retailer deliver both a healthy profit and a timely product.

  1. Decrease your shipping distance and ad-geotargetting. While partnering up more warehouse providers certainly can fix this, it requires a costly expansion. Says ShipBob, consider instead limiting the range of your marketing strategy, so that you don't reach customers outside your region of delivery, and thus aren't stuck footing the bill for shipping beyond your means.
  2. Reduce your package weight and dimensions. While extravagant boxes can make a customer feel like they're buying from the big time, the retailer more often than not ends up paying for that experience. By reducing the size of your packages, their dimensional weight, even slightly, you shave dollars off every shipment, which will quickly compound into major savings for your bottom line.
  3. Consider where you're buying your shipping materials from. If you're going to the post office to buy packing material, or buying boxes from retailers like Walmart, you're flushing away thousands in mark-ups, before you even make a sale. Shop around for local services for shipping, or bulk order from a large supplier so you can save on material like boxes, filler-padding, labels and stamps.
  4. Don't add waste. If a product comes to you already in a convenient box that is shipping-accepted, there is no need to re-box it. A simple sticker that can be placed on the box, identifying its recipient and your company, will save not only on cost of additional packaging dimensions, but physical boxes as well, that you can use on other orders.
  5. Negotiate your shipping rates. If you're moving any volume of product larger than a typical consumer or postal-system user, contact your delivery service and discuss getting yourself a deal. Be open and clear with them about your current volume, and your projected traffic in the future, and have a figure in mind as to what you'd like to pay. Most shipping companies will be more than happy to work out terms and conditions that will serve both interests and profit margins.

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