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Many companies have moved to an eCommerce model in 2020, reducing costs and increasing their customer base. However, running an eCommerce business means you’ll spend a lot of time calculating shipping costs and comparing and contrasting the best shipping companies and methods for your products.
To help estimate shipping costs, take these few things into consideration:
- Four factors that influence shipping costs are the point of origin and destination, dimensions, weight and how fast you want your product to arrive.
- Calculate the dimension weight of your package, which helps the courier know its density.
- The shipping method, including air, ocean or ground, can affect the cost, as can the choice between freight and individual shipping.
- Work with a 3PL company to reduce costs.
Order Custom Size Cardboard Boxes So Everything Fits Just RightWhen you first begin, calculating shipping costs can be a time-consuming, frustrating endeavor. Learning how to estimate shipping costs quickly allows you to spend more time creating your product and reaching new customers.
Calculating Shipping Costs: The Basics
Although many factors can alter the shipping cost, the main four are the point of origin and destination, dimensions, weight and what type of delivery option you choose. To get a shipping quote, you’ll need to input these four factors first.
Origin and Destination of Your Package
Although this may seem basic, one of the largest factors determining your shipping cost is how far the package must travel. Some companies work in shipping zones, while others just use addresses to determine the fare.
Use Shipping Materials to Help Protect Everything That’s InsideThe farther you need to ship an item, the more it will cost you. Shipping across international borders could also result in additional fees for customs.
Dimensions of Your Package
Another factor in your shipping costs is the size of your package. Larger, more awkward packages cost more to ship. Using custom size cardboard boxes can ensure your package is as small as possible, decreasing your shipping costs.
You may also find it useful to calculate your package’s dimensional weight, which tells the courier how dense your package is. Find the cubic footage by multiplying the height, length and width. Then, use your preferred courier’s dimensional weight calculator to determine the density. Each courier achieves this number through a slightly different process, although they all use a cubic divisor.
How Much Your Package Weighs
Heavier packages cost more to ship, although the dimensional weight is more important than the standard weight for some couriers. When determining the weight of a product, don’t forget to include the weight of the shipping materials, including the box, any insulating or protective material, the label and tape.
If you’re new to eCommerce and shipping, create a test package for each of your products to ensure you’re inputting the correct weight. As you become more experienced, you’ll be able to estimate how much packaging a product requires.
The last significant factor is how quickly you want your package to arrive. Many couriers offer multiple options, from standard ground shipping, which can take several days or weeks, to next-day delivery. The quicker the delivery, the more you’ll pay. The delivery time can be critical for perishable items since you need to guarantee they won’t spoil during shipment.
Faster shipment times also usually involve air shipping, which is more expensive, while ground shipping can take longer but is cheaper.
Before calculating your shipping costs, determine your ideal delivery time.
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Other Factors
Several other factors can affect your shipping costs. You may choose to add shipping insurance to your package, which protects you in case of damage during shipping. Depending on how fragile or perishable your products are, shipping insurance could save you money if your package is damaged or lost.
Several couriers offer insurance policies, but you could also invest in a third-party insurance policy that protects you regardless of the courier.
If you’re shipping many packages regularly, it may become too expensive to ship each package individually. The other option is freight shipping. So, how much does freight shipping cost? The answer to this depends on several factors, including the method of shipping (ocean, truck, rail or air), whether you use LTL (less than truckload) or FTL (full truckload) and whether your product is hazardous.
Shipping internationally can also incur significant additional fees. The role of exchange rate variability, shipping costs and geography are factors you must consider when sending your product to another country.
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Should You Work with a Third Party?
Many eCommerce businesses choose to work with a 3PL or Third-Party Logistics company. These companies store, package and ship your products for you and often have relationships with shipping companies. If you’re a smaller eCommerce business, a 3PL may be cost-prohibitive, but a 3PL could help save larger enterprises time and money.
Get Custom Packaging Today
Whether you’re just starting a new eCommerce business or looking to change your shipping routine, Air Sea Containers can help you find the best packaging for your products. We’ll create custom shipping boxes, help you understand hazard placards and ensure you have the correct padding for your packaging.
