How to Determine How Much Your Business Should Charge for Shipping

Ecommerce businesses are experiencing greater and greater competition with each passing year. In order to stay ahead of their competitors, small businesses need to offer unbeatable shipping rates. However, as a business owner, you should not blindly set a standard shipping price. If your shipping costs are too low, your business could experience significant losses. And if they are too high, you could turn away potential customers. By properly calculating shipping costs, you can protect your bottom line and offer fee transparency to your customers, encouraging their loyalty and potentially giving them the freedom to choose from a variety of shipping methods.

How exactly can you determine the shipping costs for your products? With a few key pieces of information, you can discover the best rates for your business using a shipping calculator online. You can also present this information to a trusted shipping company, and they will help you find the most economical way to ship your items.

Factors That Affect Shipping Fees

The following variables can significantly affect the shipping charges for a single shipment:

Shipping Origin and Destination

Where your package ships from and where it is going will affect your shipping rates. Carriers base fees on shipping zones, and the higher the shipping zone, the higher the shipping costs. This makes sense because the further a package travels, the more resources (gas, time, personnel, etc.) it will need to get to its intended destination.

Package Weight

It’s a no-brainer that your package’s weight will affect how much it costs to ship. Just remember that this weight is not the weight of the product alone — it also includes the weight of the packaging material, such as the box itself and the bubble wrap.

Dimensional Weight

Major shipping carriers use a pricing method called dimensional weight (or DIM weight) to calculate shipping costs. This measurement takes into account the package’s size (length x width x height). If the DIM weight is higher than the actual weight, the dimensional weight will be used to determine the final shipping fees.

Shipping Method

Do you plan on offering various shipping options to customers? The shipping method you allow customers to choose will affect the overall shipping costs. Same-day delivery jobs, for example, will cost more than flat-rate shipping methods.

Shipping Company

When calculating shipping costs to charge customers, you need to consider the fees associated with your chosen shipping carrier. Different carriers have different rates, which is why it’s important to select a carrier carefully. In fact, choosing a regional carrier to ship locally could save you significantly more than going with a major shipping company. And if you will have large shipping volumes, you will want to consider a carrier that will offer special deals based on your large volumes.

Shipping Insurance

For some businesses, it’s imperative that they purchase shipping insurance to protect their business. If you’re shipping valuable or fragile items like jewelry or electronics, you’ll want to add the cost of insurance into your shipping fees.

Let Wanner’s Transport & Delivery Give Your Shipping a Boost 

Calculating the correct shipping costs is essential to the success of your business. We can help make the process easier with courier services you can depend on. We offer everything from 24-hour shipping and cargo van dispatch services to deliveries with flatbed trucks. Get in touch with our team today for fast and efficient shipping at affordable rates!