Traditional retail and eCommerce have a lot in common (not in the least, the importance of keeping customers happy at all times). But if there is one big element that sets them apart, it's shipping. Brick-and-mortar stores don't need a client-facing shipping strategy, but in eCommerce, that's (quite literally) your bread and butter.
Without good shipping, your eCommerce business is just a bunch of ones and zeroes online.
With good shipping, it's a thriving, growing business with happy customers and repeat purchases.
So, how do you ensure your eComm shipping strategy is nailed to the last detail?
We put a guide together to help you determine the most important elements of your shipping approach, so keep reading to learn more.
People want their online shopping delivered as quickly and as neatly as possible. To better gauge your resources and tech and meet these expectations, you should first understand eCommerce shipping and fulfillment (two related but different terms).
Here's what you need to know:
eCommerce shipping involves delivering products from an online store to customers, including order processing, packaging, labeling, and handing off to a carrier. Efficient shipping is crucial for customer satisfaction, as shoppers expect fast, reliable delivery. Businesses must balance shipping rates, carrier options, and timelines to create a cost-effective strategy, essential for retaining customer loyalty in a competitive market.
Fulfillment refers to the entire process of managing and delivering a customer’s order from start to finish, encompassing inventory management, order processing, packaging, shipping, and post-sale services such as handling returns or exchanges.
While shipping is part of the fulfillment process, focusing solely on delivery, fulfillment covers a broader scope, including ensuring that products are available in stock, orders are accurate, and packaging meets customer expectations.
As you can probably guess, fulfillment is critical for eCommerce businesses because it directly influences customer satisfaction, operational efficiency, and long-term growth. A streamlined fulfillment process ensures that customers receive their orders quickly and reliably, which can enhance their shopping experience and foster loyalty.
Additionally, effective fulfillment helps businesses manage costs, reduce errors, and scale operations more efficiently, making it vital to staying competitive in the fast-paced world of online retail.
Shipping is crucial to the customer experience, as it's often the final step in the purchase journey. Fast, reliable deliveries, accurate tracking, and secure packaging build trust and loyalty, while delays or damaged goods can harm a brand’s reputation. Transparent communication and flexible options, like expedited or eco-friendly shipping, enhance satisfaction and set businesses apart in the market.
Data doesn't lie: two-thirds of consumers expect their orders to be delivered within 24 hours.
To ensure your products reach your customers in time, you need to set up an efficient shipping strategy. While every business (and its customers) is different, there are a few elements you should consider when building an efficient shipping strategy.
When deciding on a shipping strategy, one of the most important choices is handling fulfillment in-house or partnering with a third-party logistics provider (3PL). Each option has its advantages and challenges, and the best fit depends on your business's size, budget, and operational needs.
Managing fulfillment in-house gives you full control over the process while outsourcing to a 3PL allows you to leverage their expertise and infrastructure. Both approaches can support efficient shipping, but understanding their pros and cons can help you make an informed decision.
Shipping products within the same country is frequently perceived as easier than cross-border deliveries. And in many ways, that is not an incorrect assessment. However, there are benefits and drawbacks to both domestic and international shipping. In this section, we will explore the differences between the two, and how they may impact your business.
Domestic shipping is typically defined as deliveries within the same country or geographic region. It is often seen as a simpler process since it does not involve crossing borders or dealing with different customs regulations. Here are some pros and cons of domestic shipping:
International and cross-border shipping involves transporting goods across borders, making it a more complex than domestic shipping. However, the advantages are more than tempting too: as local markets become more competitive, expanding your business beyond the borders of your own country is a particularly good option (especially, but not only for EU businesses looking to expand shipping options within the European Union)
Some pros and cons of international shipping include:
As we have briefly brushed upon in the previous section, cross-border shipping poses a unique set of challenges. While EU merchants selling within the EU may enjoy streamlined shipping processes and low costs, expanding their market to international customers means facing a variety of additional considerations.
Here are some of the main points to keep in mind:
When shipping internationally, duties are an important factor to consider. Duties are fees imposed by the destination country on imported goods, often based on the value of the item, its classification, and the country of origin. Merchants should familiarize themselves with the duty rates for various regions and ensure they are accounted for during pricing and fulfillment to avoid unexpected costs or delays.
Customs processes can vary significantly between countries, and they often involve detailed documentation. These documents might include commercial invoices, packing lists, and certificates of origin, among others. A smooth customs process requires accuracy and adherence to the rules and regulations of the destination country. Failure to comply with customs requirements can result in delays, additional fees, or even the rejection of shipments.
When you build a cross-border shipping strategy, it pays to be aware of the "hidden" costs, such as:
Managing customer expectations is critical in cross-border shipping. International customers may have concerns about delivery timelines, tracking, and potential additional costs like duties or taxes. Clearly communicating shipping policies, estimated delivery windows, and any potential extra charges upfront can help foster trust and reduce misunderstandings, ensuring a positive customer experience.
When determining shipping rates, businesses must strike a balance between affordability and profitability. Offering competitive shipping rates can influence purchasing decisions, as customers are more likely to abandon their carts when faced with high shipping costs. Businesses should evaluate multiple carriers and use tools to compare rates, factoring in the size, weight, and destination of shipments to ensure fair pricing for customers without compromising margins.
Carrier selection plays a vital role in the efficiency and reliability of cross-border shipping. Partnering with well-established carriers can result in faster delivery times, better tracking capabilities, and enhanced customer satisfaction. It's also important to consider the carrier’s expertise in navigating international regulations and customs processes, as this can significantly reduce delays and streamline the delivery experience.
Last mile delivery refers to the final step of the delivery process, where goods are transported from a distribution center to the customer’s doorstep. This stage is critical, as it directly impacts the customer’s experience and perception of the service.
However, last mile delivery also poses challenges, including high costs, logistical inefficiencies, and difficulties in maintaining timely deliveries, especially in urban or remote areas.
Effective last mile delivery management is essential to overcoming these challenges and building an eCommerce delivery strategy that meets all expectations (and keeps your business thriving).
By leveraging technology and strategic planning, companies can optimize routes, enhance delivery speed, and improve communication with customers. This is where platforms like Postis play a pivotal role. Acting as a control tower for last mile delivery, Postis also provides you with advanced analytics to provide actionable insights, optimize performance, and ensure full transparency throughout the process.
Packaging is more than just a protective layer for the product; it serves as a direct reflection of your brand identity. An eye-catching and well-designed package can leave a lasting impression on customers, reinforcing brand recognition and fostering loyalty.
High-quality packaging materials also play a role in ensuring the product remains intact during transit, reducing the risk of damage and returns.
Sustainable packaging has become an essential consideration for businesses looking to align with modern consumer values (especially considering the wave of support for sustainable eCommerce).
Using eco-friendly materials like recycled paper, biodegradable plastics, or reusable options not only reduces environmental impact but also demonstrates your company's commitment to sustainability. This small but impactful choice can significantly enhance your brand's reputation and appeal to environmentally conscious customers.
Efficient fulfillment and last mile delivery services, as well as advanced technology, are key components in streamlining your eCommerce operations. Here are some of the basics to know about this:
Modern shipping software is designed to simplify and optimize the logistics of online order fulfillment, saving businesses time and reducing operational errors. Here are some key features of modern shipping software:
Working with a fulfillment partner can help you streamline your order fulfillment process and improve efficiency in several ways:
Automation, order routing, and real-time tracking are critical components of a streamlined fulfillment process. Automation reduces the risk of human error while enhancing efficiency, ensuring that orders are processed quickly and accurately.
Furthermore, intelligent order routing enables businesses to allocate orders to the nearest warehouse or fulfillment center, minimizing shipping times and costs. These technologies work together to optimize the supply chain and improve customer satisfaction.
At the same time, real-time tracking provides both businesses and customers with visibility throughout the shipping process. Customers can monitor the status of their orders, building trust and transparency. For businesses, real-time tracking allows for proactive issue resolution and better communication with customers. By integrating these advanced technologies, companies can stay competitive and deliver an exceptional customer experience.
Efficient inventory management across multiple fulfillment centers is crucial for meeting customer demands and minimizing operational costs. By accurately tracking stock levels and forecasting demand, businesses can ensure that products are stored in optimal locations to reduce shipping times and expenses.
Utilizing centralized inventory management systems allows companies to maintain visibility into stock availability across all locations. This improves decision-making, prevents overstocking or stockouts, and ensures that orders are fulfilled swiftly and accurately.
Efficient shipping is essential for any business. Since shipping costs can add up quickly, it’s important to focus on reducing expenses while improving operational efficiency. Streamlining your delivery operations not only lowers costs but also boosts margins. For example, optimizing delivery and logistics processes can have a direct impact on overall cost reduction, as highlighted in this case study.
Here are some practical ways to achieve this:
Save on shipping by partnering with carriers that offer business discounts, especially for bulk or high-volume shipping. Joining shipping programs and using online platforms can help secure lower rates. Compare courier services and use shipping calculators to find the best price for each shipment.
Zone skipping refers to the process of bypassing certain shipping zones to reduce delivery time and costs. This can be achieved by consolidating packages and delivering them directly from a central hub to the destination zone.
Distributed warehousing involves storing products in multiple locations closer to customers, reducing shipping distances and costs. This approach also improves delivery speed and enhances customer satisfaction.
Smart packaging technologies are increasingly being adopted to minimize dimensional weight charges in shipping. By designing more compact and efficient packaging, businesses can reduce wasted space and align package sizes more closely with the actual product dimensions.
Additionally, using automated systems to create custom-fit packaging for each shipment further optimizes the process. These technologies ensure that packaging materials are used more efficiently, while also protecting the products effectively during transit.
Achieving a balance between cost and sustainability in shipping requires innovative approaches. Businesses must focus on reducing excess packaging to lower material costs while minimizing environmental impact. Streamlined packaging not only saves money but also helps companies meet growing consumer expectations for eco-friendly practices.
Sustainability efforts can also lead to long-term savings and efficiency. Custom-fit packaging technologies, for example, eliminate unnecessary waste and improve space utilization during transit. By adopting these strategies, companies can create a shipping process that is both cost-effective and environmentally responsible.
eCommerce shipping is as much about the post-purchase experience as it is about the actual delivery of goods. Customers today demand a seamless and hassle-free returns process, which can be a challenge for companies to manage.
To improve the post-purchase experience, companies need to invest in efficient and transparent return policies, like:
Branded tracking and delivery notifications provide customers with real-time updates on their orders, fostering trust and transparency throughout the delivery process. By customizing these notifications with company branding, businesses can reinforce their identity while keeping customers engaged and informed, ultimately enhancing satisfaction and loyalty.
Efficient returns management and reverse logistics are critical for maintaining customer satisfaction and streamlining operations. By simplifying the returns process and ensuring clear communication, businesses can build trust while minimizing costs associated with product returns. This approach not only improves the customer experience but also helps optimize inventory and reduce waste, creating a more sustainable and efficient supply chain.
Addressing delays proactively and managing customer expectations are essential for maintaining trust and satisfaction. Providing timely updates, clear communication, and offering alternative solutions can help alleviate customer frustration. This approach ensures transparency, fosters loyalty, and demonstrates a commitment to resolving challenges effectively.
Maintaining compliance and mitigating risks are critical to building and sustaining customer trust, so here are some details to consider:
Insurance for shipments protects both businesses and customers from financial loss due to unforeseen circumstances such as damage, theft, or loss during transit. By ensuring adequate coverage, businesses demonstrate accountability, build trust, and provide peace of mind to their customers while also safeguarding their own financial interests.
Protecting data privacy in shipping and notifications is crucial to maintaining customer trust and complying with legal regulations (like the GDPR in Europe, for example). By implementing secure systems to handle sensitive information, such as addresses and payment details, businesses can ensure that customer data is protected from breaches or misuse, fostering confidence and loyalty.
Consumer protection regulations are designed to safeguard buyers from unfair practices and ensure transparency in transactions. For businesses, this means adhering to standards that protect customer rights, such as clear refund policies, accurate product descriptions, and fair pricing practices. Compliance not only fosters trust but also helps avoid legal penalties.
Building a well-oiled eCommerce shipping strategy and ensuring the right tools, tactics, and security measures are in place can all make or break your business.
As such, it is crucial to understand the key components involved in eCommerce shipping and implement best practices and compliance measures, so you can create a hassle-free online shopping experience for customers while also safeguarding your business from potential risks.
Remember, establishing a successful eCommerce shipping strategy takes time and effort, but the payoff is worth it in terms of customer satisfaction, trust, and long-term growth potential.
eCommerce shipping involves the process of delivering products purchased online to customers. This includes order processing, packaging, and transporting items via shipping carriers.
The cost of eCommerce delivery depends on factors like package size, weight, shipping distance, delivery speed, and the carrier used. Costs can range from a few dollars for local shipments to higher amounts for expedited or international delivery.
The cheapest shipping company for eCommerce depends on your location and shipping needs. USPS, UPS, and FedEx are common in the U.S., with USPS often being the most cost-effective for small, lightweight packages. Globally, services like DHL or local carriers may offer competitive rates.
