Are you running an online business that involves shipping products to customers?If so, you must precisely calculate and estimate the delivery costs.
This task can seem intimidating, especially if you are dealing with multiple carriers and shipping zones. However, that shouldn’t be the case.
In this post, we’ve rounded up some points on how to calculate and estimate shipping costs for your business.
5 Simple Tips on How to Calculate and Estimate Shipping Costs
For any business, calculating shipping costs is important.It helps you set reasonable rates for clients and keeps your business profitable.We’ve put up five basic tips to help you calculate delivery costs.
Understand the Factors that Affect Shipping Costs
The first step in calculating and estimating shipping costs is to understand the various factors that affect them.These include:
Dimension and weight of the package.The dimension and weight of the package affects the total shipping costs.The bigger or heavier the package, the higher the shipping cost that you will pay.
Shipping destination.Shipping costs also vary based on the distance and shipping zone.
Shipping method.Various shipping methods such as ground, air, sea, or expedited have different costs associated with them.
Carrier.Carriers charge different rates for shipping.
Use a Shipping Calculator or Estimator
Wondering what the easiest way is to calculate shipping costs?The trick is to use shipping cost calculators or estimators.
Several carriers provide online calculators that let you enter package details, including weight, size, destination, and delivery mode.Entering this information will help you estimate shipping costs.
These calculators are very advantageous when it comes to comparing rates across different carriers, selecting the most cost-effective option, and getting a more accurate idea of the expected shipping cost.
Negotiate with Carriers
Does your business ship huge volumes of packages?Good news awaits you because you are in a position to negotiate better rates with carriers.
Do not hesitate to contact your carrier and ask if they offer volume discounts or special rates for businesses like yours.You may also consider using a third-party logistics provider(3PL)to negotiate rates on your behalf.These businesses usually conduct huge transaction volumes with carriers, so they can help you save more money in the long run.
Use Flat Rates or Shipping Quotes
Another option for simplifying shipping costs is to use flat rates or shipping quotes.Flat rates are fixed costs regardless of shipment weight, size, or destination.
Flat rate shipping can be an incredible option for businesses that ship small and lightweight packages.
Offer Free Shipping
Offering free shipping can be an awesome way for you to attract customers and increase your sales drastically. However, it’s crucial to factor in the cost of shipping when setting your prices.To make free shipping work for your business, you should consider hiking up your prices slightly to cover the shipping cost.
Estimating and calculating transportation costs can be difficult, but you can’t avoid it since it is necessary for your business.
By understanding the factors that affect shipping costs, learning how to use a shipping cost calculator or estimator, negotiating with carriers, using flat rates or shipping quotes, and offering free shipping, your business can better provide accurate shipping costs and maximize your profits.
Need some help calculating your shipping costs?We can help you.Simply contact OneShip to solve all your shipping needs, or sign up here.