Every new online ecommerce business faces the same initial quandary; shipping strategy and shipping labels. In this article we will outline a few of the most popular shipping strategies and provide a shipping label and packing slip solution.
Shipping and handling costs can greatly influence the decision to buy after a potential customer adds a product to their shopping cart. According to a study done by Shopifiy, 44% of buyers abandoned their cart because they considered shipping and handling costs to be too high. Because it has such a big impact, it is important to choose your business’s shipping strategy carefully. Below you will find a few strategy options and their pros and cons. As a bonus, we have offered a shipping label and packing slip solution.
Free Shipping Strategy
When a business chooses to use free shipping as a strategy, the cost of shipping and handling is absorbed by the company. The consumer pays only the price of the product and its respective taxes.
Pros: Business 2 Community slates the word FREE as one of the top 5 most persuasive words in the English language. Inc.com considers free shipping to be a must when it comes to ecommerce shipping. Their article notes that free shipping is generally the deciding factor. Additionally, consumers are willing to wait longer to receive their product if it is shipped for free.
Cons: ShipHawk cautions that free shipping directly impacts your profit margins. When you do not charge for shipping, it becomes a cost of doing business. If you include the shipping in the price of the product, superficially it can appear to be more costly than comparable products.
Real Time Carrier Rates Strategy
Charging a real time carrier rate means that customer pays what you would have to pay to ship to them. There are many ecommerce platforms that integrate with various couriers including USPS.
Pros: The consumer chooses exactly how fast they want to receive their product and how much they are willing to pay for shipping. This strategy gives the consumer improved confidence through full transparency into shipping costs.
Cons: Bigcommmerce discusses the challenges of this strategy in one of their blog posts. They note that when using a real time carrier rate strategy, your business isn’t going to make any extra margins and you’ll likely break even on shipping costs. Another challenge is that consumers won’t know the final cost of purchasing the product upfront.
Flat Rate Strategy
If a business implements a flat rate shipping strategy, they charge a single rate for all orders. The business will average out all the costs of a company’s shipments and then charge a flat rate.
Pros: Forbes outlines in one of their articles that due to averaging of shipping costs, you can plan on your company losing money on half your shipments but making money on the other half. It is unlikely you will earn a profit on shipping, but you should break even. Flat rate shipping also helps to keep things simple for the consumer.
Cons: Because of shipping price fluctuation, you’ll need to pay close attention to the average as it will change over time. If you neglect to adjust for the rise in the shipping costs, your business will begin losing money.
Shipping Label and Packing Slip Solution
After your business has selected a shipping strategy, you will need to find an affordable and convenient way to print professional shipping labels and packing slips. My1Stop offers integrated labels as a great solution. Integrated labels are used to print packing slips or invoices and shipping labels in one pass. With the help of an integrated label, you’ll be able to save time, money and confusion. Visit My1Stop for the best online selection for all your shipping label solutions.