How to Determine the Shipping Cost for My Online Store?
Starting an online store and sending your orders to other parts of the country and even the world are all exciting. However, the shipping process, logistic rules, and particularly determining the shipping cost can be confusing. You need to set a pricing system to avoid overcharging your customers or losing money on shipping.
But you don’t have to worry! Selldone offers the best solution to help you learn how to set shipping costs based on your products’ specifications, distances, and each country’s logistic rules. In this guide, we'll break down the process of determining shipping costs for your online store. We’ll cover everything from understanding the different factors that influence shipping prices to using tools and strategies that can help you find the best rates. So, let’s start with the factors influencing the shipping costs.
What Factors Influence the Shipping Costs?
You may think only the size or weight of the products matter when it comes to calculating the shipping price. But there’s more to the story! Here are the key elements you need to know:
Package Weight and Dimensions: As mentioned previously, the size and weight of your package are major factors in shipping costs. Larger and heavier packages generally cost more to ship.
Shipping Distance: The farther the package has to travel, the higher the shipping cost. Shipping domestically is usually cheaper than international shipping.
Shipping Speed: Faster shipping options, like next-day or two-day delivery, are more expensive than standard shipping. The urgency of delivery directly affects the cost.
Shipping Carrier: Different carriers offer different rates and services. Popular carriers include USPS, UPS, FedEx, and DHL. Each carrier has its own pricing structure and discounts.
Shipping Method: The mode of transportation (air, ground, sea) also influences the cost. Air shipping is typically faster but more expensive than ground or sea shipping.
Destination Type: Shipping to residential addresses can sometimes be more expensive than shipping to business addresses. Some carriers charge additional fees for delivering to remote or rural locations.
Customs and Duties: For international shipping, customs fees, duties, and taxes can add to the overall cost. These charges vary by country and the value of the items being shipped.
Insurance and Tracking: Adding insurance and tracking to your shipments provides peace of mind but can increase the cost. Insurance protects against loss or damage, while tracking allows customers to monitor their package's progress.
Packaging Materials: Finally, the cost of boxes, bubble wrap, tape, and other packing materials should be factored into the shipping cost.
How to Choose the Right Shipping Carrier?
If you don’t carefully choose the right shipping carrier, you can’t promise timely and cost-effective delivery of your products to your customers. Here are some steps and tips to help you choose the best shipping carrier for your needs.
Evaluate Your Shipping Needs
You should first consider the shipping features you want to offer. These factors play an important role in choosing your shipping carrier:
The size, weight, and fragility of your products
Domestic, international, or both types of shipping
The time of delivery (standard, expedited, overnight)
Compare Shipping Rates
Use online shipping calculators from various carriers (USPS, UPS, FedEx, DHL) to compare costs for different package sizes, weights, and destinations. Look for volume discounts if you plan to ship frequently or in large quantities.
Check Delivery Times, Quality, and Customer Support
Research each carrier’s average delivery times and on-time delivery rates. It’s also helpful to read reviews and get feedback from other businesses about their experiences with the carriers. Moreover, make sure the carrier has a responsive customer support system to handle any issues that may arise. Another important factor to consider is reviewing the carrier’s terms regarding liability, insurance, and claims processing.
Test the Carrier
It’s a good idea to do a trial run with a few carriers to evaluate their performance firsthand. This way, you can monitor how they handle your packages, the accuracy of their delivery times, and the quality of their customer service.
What Are the Pros and Cons of Free Shipping?
If you’re wondering about offering free shipping, you should consider its pros and cons and then decide if you want to include this option. Here’s a breakdown of the possible advantages and disadvantages of free shipping.
Pros of Free Shipping
It’s a major incentive for shoppers and can significantly increase the number of visitors to your site.
Free shipping can lead to higher customer satisfaction, encouraging further purchases from your store.
It sets you apart from competitors who charge for shipping.
Setting a minimum purchase requirement for free shipping makes customers add more items to their cart, increasing your AOV.
This way, customers see a straightforward price without additional fees, making the purchasing decision easier.
Cons of Free Shipping
Covering the cost of shipping can impact your profit margins, especially for small or low-margin businesses.
It might require you to adjust your product pricing or find other ways to offset the shipping costs, which can be complex.
Managing free shipping promotions requires efficient logistics to avoid delays and ensure timely deliveries.
Free shipping often leads to an increase in returns, and handling return shipping can add to your expenses.
Customers might become more price-sensitive, expecting free shipping on all orders, which can make it hard to introduce or maintain minimum purchase thresholds.
How Can You Calculate Shipping Cost on Selldone Shop?
Selldone has made it easy for online shops to calculate the shipping cost and specify all the factors related to it. You’ll have access to all the required settings to set them up based on your preferences. First, open your shop on Selldone and click on Logistic on the main bar. Then choose Warehouse to set the address of the shipping origin.
Add your address and scroll down to specify the shipping area limitations and length, width, and height units.
By selecting the Shipping option, you see several shipping options, such as Motorbike, Small Cargo, Cargo, Truck, etc. Choose any shipping type based on the products you want to deliver. Click on the icon shown below to change the settings of your transportation service.
A new window will open that contains the following sections:
1. In the first section, you can enable or disable this shipping type.
2. The next section allows you to customize the name and logo of the transportation service.
3. In the third section, you can specify limits for the covered distance and also acceptable package weight.
4. Then, as shown below, you can set the maximum dimension sizes.
5. Here, you can set the delivery dates based on your preferences.
6. In the payment section, you see several options. You can decide to accept COD (Cash on Delivery) or online payment only. Also, you can choose auto shipping cost calculation to automate the process. Or you may want to leave it to the customer to pay directly to the courier at their destination.
7. The next section allows you to set a fixed price for each country. If you deliver packages to different countries, you can add distinct profiles for them. Click on “Add Country Profile” and choose the option you find suitable for you.
8. Finally, Selldone lets you set free shipping by enabling the option you can see below. You can also set a minimum order cost.
Congratulations! Now your store has logistic settings based on your preference and needs. With only a few clicks and adding the required data, you can determine shipping costs for your orders and get rid of price-calculating confusion!
Final Word
Balancing customer satisfaction and profitability requires the right shipping costs for your online store. Now that you know various factors that influence shipping prices, and the best method to calculate the cost, you can create a strategy that works best for your business.
Selldone helps you manage shipping, inventory, and more, all in one place. So, why not give it a try and see how Selldone takes your online business to another level?!
Make Your Business Online By The Best No—Code & No—Plugin Solution In The Market.
30 Day Money-Back Guarantee
Say goodbye to your low online sales rate!