How to Save on Shipping: 5 Cost-Reducing Tips for Small Businesses
When you’re running a small business, you need to minimize costs and maximize revenue to not only stay afloat, but help your business grow. Shipping costs are one of the most costly expenses for small online retailers, and they only tend to grow as carriers increase their rates, which happens at least once a year. Luckily, there are ways to save on shipping and boost your profits. Let us offer you a few tips that might be helpful in this regard.
Optimize Your Packaging
Unless you’re using flat rate shipping, it will cost you more to ship heavy or big items because carriers charge either by gross weight or by dimensional weight, whichever one is greater. While there is little you can do about the gross weight of your packages, you can reduce their dimensional weight and by extension your shipping costs.
To put it short, you shouldn’t pay for shipping air. When packing orders, make sure that each box you use is the right size for the items inside because not only does extra space make your shipping expenses increase, it also endangers the items inside the box. If you mostly ship small and relatively durable items, consider mailing them in padded envelopes instead of boxes.
As for gross weight, we know that we’ve said that there is little you can do about it, but little doesn’t mean nothing. You cannot reduce the weight of the items you ship, but you can reduce package weight by using lightweight packing materials. For example, corrugated boxes are both lighter and stronger than regular cardboard boxes, which makes them a great solution for online retailers.
Another option for you to consider is ordering custom packaging. It might seem like another expense at first glance, but custom packaging may help you save more money in the long run than you’ve originally paid for it.
Consider Flat Rate Shipping
Flat rate shipping means that the price of shipping isn’t directly tied to the gross or dimensional weight of the package; it depends on which flat rate box or envelope the item you need to ship fits into. Sometimes it’s cheaper than standard shipping; sometimes it’s not.
What’s beneficial about flat rate shipping as far as running a small business is concerned is that your shipping costs are fixed. You know exactly how much delivery is going to cost and make your shipping prices clear to your customers right away.
Negotiate Shipping Rates with Carriers
A lot of small online retailers, especially those that are just starting out, automatically assume that they don’t qualify for carrier discounts because they don’t ship dozens of packages every day. However, it is often enough to ship as few as 100 packages a month to negotiate discounts with your carrier.
So gather your numbers and contract the shipping services departments of all major carriers to negotiate your rates. Negotiating with multiple carriers is crucial for getting the best deal. First, you need to know all your options. Second, your current carrier may be willing to give you a shipping discount just to keep you from taking your business elsewhere.
Print Discounted Shipping Labels
If you’re not willing to negotiate your rates directly with shipping carriers, you should consider using third-party services that allow you to print discounted shipping labels, such as PostageMaker. These services have shipping discounts from major carriers due to the large volume of shipping labels they generate. They share this discount with their customers, helping them reduce their shipping costs.
One of the great things about printing your shipping labels yourself is that you don’t even need any special equipment or supplies for this; a regular printer and office paper will do. Then you can use glue or scotch tape to affix shipping labels to your packages.
Try Third-Party Insurance
Shipping insurance is one of the factors that affect shipping costs. While shipping uninsured packages is not the best idea, especially when you’re running a business, you don’t have to stick with the insurance offered by your carrier. In many cases, the price of third-party insurance is significantly lower than the cost of insurance that shipping carriers factor into their rates.