Whether your business is retail or wholesale, shipping should be a key area of focus. Many businesses fail to optimise their shipping arrangements, failing to take into account the potential cost savings and customer experience improvements that can be achieved. Let’s look at some of the key shipping practices that are commonly used by successful businesses.
Ideally, shipping costs should be transparent to the customer. Customers make decisions quickly, especially in the retail context. If your customer has to login or proceed to checkout to get a shipping estimate, they are less likely to purchase now, instead putting off the decision to buy, or opting for another retailer. On the other hand, by prominently integrating shipping information into the user experience, customers are able to rapidly appraise shipping costs and decide whether to purchase. An elegant and well tested solution is to include shipping costs in an order talley in the ‘basket’, ‘cart’ or ‘shopping bag’; customers can hover over their basket or bag to view the items they are currently considering and quickly receive a shipping estimate.
Don’t treat shipping as a profit centre
This is a controversial view but it also reflects customer sentiments. Despite the convenience and value that shipping adds to the shopping experience, customers tend to be very sensitive to shipping price. This is often an emotional response as much as an economic calculus; customers sometimes associate marginally higher prices with better products but fail to see any value add in a higher shipping price. As much as it might grate, treat shipping as an expense to be minimised rather than a source of revenue.
Under promise, then over deliver
Shipping times can be volatile as carriers can be affected by adverse events in unforeseeable ways. Stay on the front foot by building in some leeway, and then aiming to deliver well within that timeframe. Over time, your performance will build a much better reputation for timeliness than the timeframe you promise.
Use appropriate packaging
Effective shipping requires packaging that protects your products, imparts a quality image and minimises cost. Finding the best packaging involves a trade-off between all three factors. For very low value items, minimising cost may be the most important objective. For an upscale retailer, nice looking packaging and safe products are likely to be paramount. As a starting point, consider what type of packaging is most appropriate for each individual product. For example, a large box is unnecessary for a small shipment. Equally, expensive insulation is unnecessary for shipping low value products to a wholesale customer – it is likely to be much simpler to build an acceptable level of breakage into supply contracts.
Partner with a reliable shipping carrier
If your shipping options are well thought out and your packaging is fit for purpose, it makes sense to ensure that the people who are delivering your shipments are reliable and professional. A reliable carrier should be able to promise, and stick to, on-time pickups, deliveries and visibility of your shipments from point to point.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.