FedEx and UPS follow a dimensional pricing model, meaning shipping costs are determined by package weight and size for ground shipments. Kevin Lathrop, CEO of shipping company Unishippers Global Logistics, said many businesses made a lot of adaptations to optimize their packaging for this reason.
“You want to use the minimum amount of space you can,” Lathrop said. “Package for safety and density, and put [your items] in an appropriate box for the load.”
If you’re shipping multiple items on a shrink-wrapped pallet, label each box in case the load is broken up before it reaches its destination, Lathrop said.
Depending on the package weight, your fastest, least-expensive delivery method might be to have a private carrier take it part of the way, with the USPS making the final delivery, Poore said.
Shipping technologies and analytics – Technology has made it much easier to manage the shipping process. Businesses of all sizes can monitor shipments at every stage of the journey, allowing customers to receive accurate and timely updates. But that ability isn’t only valuable for the customer; it also ensures that the business isn’t held liable for delays, errors or damage that occurs once a product has shipped.
In the past, if a customer reported an incorrect or damaged product, you had to take their word for it. Now, however, businesses can use video surveillance, real-time scanning and tracking, and other analytics tools across their entire supply chains.
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It’s essential to provide tracking details for customers, because they want to know exactly where their purchases are, said Jarrett Streebin, CEO of shipping solutions provider EasyPost. He advised focusing on packing and shipping orders within 24 hours whenever possible and sending tracking numbers immediately.
Caporaso said retailers should evaluate their shipping strategy every six months to ensure that it’s operating at peak efficiency and delivering the best possible value to customers at the lowest possible cost to your business. An ongoing program of data collection and analysis is an invaluable part of that effort, he said.
Ultimately, customers’ expectations should be at the center of every shipping decision you make, Caporaso said. A carrier that saves you money in the short term but alienates your customer with poor service will eventually cost you customers, and money, in the long term.
Cost – To run a profitable e-commerce business, it is critical to watch your bottom line, and shipping is a major expense. Even though free shipping will be more appealing to your customers, many shoppers are willing to pay a reasonable price for shipping if it is fast.
Make sure to choose a shipping schedule that will not increase your overhead but will still satisfy your customers’ needs. Compile a list of the shipping options and their prices. Then, compare this information to your profit margins, and choose an option that will help you hit your financial goals.