9 Tips on How to Lower Shipping Costs for Your Business

9 Tips on How to Lower Shipping Costs for Your Business

Whether you ship just a few items each month or you’re rapidly scaling, minimizing your shipping costs is vital to your business. Once a package leaves your doors, the cost to ship it is out of your control, but thankfully there are many things you can do before that point to save money. After you discover how much influence you have over your shipping prices, you can begin implementing the necessary changes to improve your business.

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9 Tips on How to Lower Shipping Costs for Your Business

You may be able to take some steps right now to cut down on shipping costs for your business. Check out some of the strategies you can implement to take advantage of low-cost shipping services.

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Reduce Package Dimensions

Carriers divide the volume of a package by a figure called a dimensional weight (DIM) to determine how much a particular package will cost to ship. Carriers will charge based on the weight of an item if it weighs more than its calculated dimensional weight. If you can reduce the length, width, or height of your package, you will also likely reduce its shipping cost.

Cut Down Distances

Shipping companies use eight different zones in the United States to help determine shipping costs. The cost to ship a package increases with each zone it enters, so the fewer that your packages need to cross to reach their destinations, the better. With a shorter distance to ship, your package will also get to your customer sooner, increasing their satisfaction.

Remove Weight

Heavier packages cost more to ship, especially if the weight of a package exceeds its DIM weight. Reduce weight where possible in your goods or packaging. This might require a redesign of your products or presentation (both of which might impress your customers).

Talk with Your Suppliers

It’s very likely that you can save on shipping costs by simply talking with your suppliers and better coordinating with them. You might have them adjust their delivery process so that you receive everything you need from them in one batch or convince them to use your account when shipping to you in order to increase the volume of goods you ship and thus reduce your prices.

Shop Around for Carriers

You could get a better deal on your shipping by shopping around for different carriers and negotiating with your current one. They may be flexible on the pricing they are willing to offer you, especially if you have another deal you can turn to instead of them. Regional carriers may offer better deals than national ones, especially if you’re shipping goods within a certain region. However, while it may be tempting to go only with low-cost shipping services, you get what you pay for, and a reliable shipper may be worth the price.

Get Third-Party Insurance

Insurance costs can quickly eat away at your profit margins. You’ll have to pay $0.90 to insure every $100 of goods you ship if you buy insurance from your carrier. Third-party insurers can cut this cost down to $0.55 per $100. If you plan on shipping a large volume of goods or a few expensive items, the savings can quickly add up.

Keep Track of Fees

As a shipper, you can incur a wide variety of fees, from the cost of fuel used to deliver a good to shipping something on a Saturday. Keep track of all the fees you run into and consider adjusting your shipping process to cut down on them. Some of the services you’re getting charged for might not even be what your customers want or need.

Choose the Right Packaging

Some shippers offer free packaging that is already tailored to their size regulations. Choosing this for your products can cut down on materials costs and will help you avoid paying more just because your package incurred a dimensional fee. Poly mailers are also a popular alternative to boxes, especially if you’re shipping clothing. They are lighter than boxes, take up less space, cost less, and are easier for your customers to dispose.

Work with a 3PL

A third-party logistics company can reduce your shipping costs and streamline your operations by taking them over for you. They’ll typically ship a large amount of product, meaning they can obtain lower rates. They also have an experienced workforce dedicated to getting products to the customer, which can allow you to outsource all of these tasks to them. A 3PL that specializes in American fulfillment services can help you quickly reach customers in a massive market.

Save Money With Low-cost Shipping and Fulfillment Services

Your savings on shipping could quickly add up, both in terms of your actual savings as well as increased sales you’ve made due to lower shipping costs. As inefficient shipping practices may also be tied to other inefficiencies in your business, improving your shipping process could improve those other trouble areas as well. A smoother, more efficient shipping process can also boost customer satisfaction, helping to further boost your reputation and sales.

Knowing how to lower shipping costs is vital to competing online, protecting your profits, and successfully growing your company. If you’re interested in a reliable partner to help reduce your shopping costs, then a 3PL provider, like us, could be exactly what your business needs. Contact us today to learn how we can handle your business’ shipping and fulfillment needs!