Ana Shan, Author at Global Trade Magazine

The ecommerce sales are set to touch 6.5 billion USD in 2021. With the ever-expanding ecommerce industry, the shipping industry is also set for an explosion. Coupled with the changes brought about by technology and dynamic user preferences impacting the ecommerce shipping field, how do you prepare to excel, then? This article will work as a beginner’s guide to tell you all about ecommerce shipping. The world of shipping will no longer be a difficult mystery.

Shipping 101

Here is how you can map out your shipping plan to streamline and organize:

1. Shipping Strategy

Creating a shipping strategy is the first step. Here are the key points you need to consider:

Shipping rates: Will you charge flat shipping rates for all your orders or will they differ from destination to destination? A customer might abandon the cart if the shipping rate is too high, and you might incur a loss if it is too low. Decide on the shipping-rate policy first. You can also increase product prices slightly and offer free shipping.

Inventory/order management: Will you manually update every order and maintain the inventory or will you automate it? Automation is recommended as it minimises the errors.

Global or local? Will you ship across the globe? Or will you ship only in your country? This question is important to answer as it will determine how much you spend on shipping, the carrier you use, the time taken for delivery, etc.

Shipping methods: What mode will you ship through? Air, sea, or land? There might be higher risk and lower shipping cost when you choose sea over land and air, but shipping by air will afford you to deliver faster. Make a list of the pros and cons of all methods to decide.

Shipping insurance: Shipping carriers offer insurance, and this can give you a great deal of security. Get the coverage, especially if you have large volumes.

2. Shipping Costs

While calculating shipping costs, these are the four points you need to keep in mind:

Shipping carrier: Shipping carriers like FedX, Aramex, DHL, UPS are popular with ecommerce companies. But if you are only going to ship locally, ask for quotes from your local carriers, the rates might be much much cheaper. Use the shipping carrier’s calculator to compare.

Source and destination countries: The distance between the source and the destination and whether both the points are in the same country will play a huge role in determining the shipping costs.

Product dimensions and weight: It is advisable to measure all your products before you list them online – every shipping carrier charges depending upon the weight and dimensions of your package.

Margin-wise: Be margin wise. Are the shipping costs too heavy on the pocket? How much profit margin do you want to keep? Shipping is a major expense, and you should never ignore the small charges.

3. Packaging and labelling

You can either source the packaging from your shipping carrier, or use it as a way for branding. With increasing awareness, sustainable packaging is much in demand, but it is also expensive. You can also offer personalised packaging or special packaging for gift orders.

Another important part is the labelling. Each order must be labelled with the order number, the addresses among other details. Doing this incorrectly might result in a mix-up.

4. Invoicing

Many countries have laws that require multiple copies of invoices to be sent with the package. One for you, one for the customer, one for the shipping carrier, one for taxation purposes etc. Invoicing can be automated too. Just invest in good virtual infrastructure.

5. Communication and tracking

Once the order is shipped, most automation software solutions send an e-mail to the customer with the tracking link. This is a very important part of the shipping process. If the customer doesn’t receive communication from your end, it not only looks bad on your company but also might result in complaints.

6. Auditing Shipments

This is the part which most ecommerce companies fail to do. And even if they audit their shipments, they do it manually. Auditing your shipments allows you to claim for refunds from your shipping carrier. There might be duplicate or incorrect charges on your shipping invoice, or the carrier might have damaged or lost your package. You can get reimbursed for it and save on shipping costs.

7. Customs

If you are shipping globally, be well-aware of prohibited items that differ from country to country. Also, the documentation should be spick and span for the package to clear the customs zone. Know about the customs fees and don’t forget to add it to your ecommerce platform, so the customer is not kept in the dark. Most shipping carriers offer information about customs declaration on their websites.

Questions to Ask Yourself Before Making a Shipping Plan

-What is your shipping budget? Will you charge real-time carrier rates for all your orders?

-Will you offer next-day or same-day delivery?

-What packaging will you use?

-Where will you ship and where will you not?

-Will there be a minimum order cost for free shipping?

-How will you communicate regarding the orders with your customers?

-Will you opt for third-party logistics?

-Will you choose automation software solutions when it comes to shipping management?

Quick Tips

-Focus on creating a great customer experience when you package and ship the product.

-Premium packaging can encourage repeat customers.

-If your shipping strategy doesn’t work, always have plan B.

Know the rules and regulations of all the states and countries you are shipping to. Some products might be banned.

Remember to one order might have multiple shipments. That’s double-triple the work.

Outsourcing the logistics and the auditing might save a lot of work, and you can let the experts handle it for you.

There are multiple variables when it comes to ecommerce shipping. Understand, plan and then execute. While shipping might seem like a not-so-important aspect of your ecommerce business as sales, it is actually a driving factor – one that can help you achieve success.

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Ana Shan is a product evangelist at AuditShipment.com, an AI-driven audit service that automatically captures more than 20 carrier errors and helps businesses save up to
16% of their shipping costs.

This year, the ecommerce shipping industry is adapting automation and other efficiency-boosting tech tools for a 360-degree transformation. The shift in trends that began in 2019 is only going to pick up pace this year, with two of the most important trends of automation and scaling globally gaining impetus.

In 2019, 79% of US ecommerce shoppers said that free shipping would make it more likely for them to buy things online. 53% of users abandon the cart because of hidden costs like shipping, tax, etc. That’s how important shipping is for ecommerce sales.

So what changes should you be prepared for in 2020 when it comes to shipping?

What do you need to know about ecommerce shipping?

These are some of the questions we aim to answer through this guide.

A Step-Wise Peek Into the Ecommerce Shipping Process

Step 1 – Understanding a shipment

The most basic thing you need to understand is what constitutes a shipment. A shipment can be one thing or multiple things, created as a result of an order placed by a customer through online channels. One order might have multiple shipments too.

Step 2 – Using a shipping management software

Managing an inventory, especially when you are listing your products or services on multiple platforms, is a must. Using shipping management software keeps you organized. It also helps you check the status of every order in real-time.

Step 3 – Choosing your shipping carrier

There are a host of shipping carriers that are preferred by ecommerce companies like UPS and FedEx, among others. Therefore, compare the costs, the insurance, the delivery times, and the network of a shipping carrier before choosing one.

Step 4 – How to ship?

What is the most effective shipping method for you? By air, sea, or road? Ascertain this.

Step 5 – Determining whether to ship globally or locally

Will you be taking orders from international customers, or will you be shipping only in your city, state, or country? Answering this question will help you streamline the process.

Step 6 – Tracking & communication

Your work only begins once you have shipped an order; it does not end there. Customers prefer to have constant communication about their orders through tracking. Until the product is delivered, your job is not done.

Step 7 – Packaging and labeling

Incorrect labeling or inefficient packaging can cause damage or loss. Also, a badly packaged product negatively affects brand reputation.

Step 8 – Calculating costs

Shipping costs are one of the most important heads in your company’s balance sheet. Consider the factors like shipping methods, package dimensions, third-party-logistics, etc. while calculating the costs.

Step 9 – Knowing the regulations

You have to check the rules and regulations for all the countries or states you are shipping to. Some products cannot be shipped, while some need to have accompanying documentation, especially when you are shipping globally as they pass through customs. Know this beforehand.

Step 10 – Auditing & refunds

One of the most important steps is auditing your shipments. Shipping carriers might often overcharge you or levy incorrect fees and charges on your shipments. Automated or manual auditing allows you to claim refunds, making a slight addition to your capital.

Shipping Trends to Watch Out For in 2020

1. Going global

The whole world is a market. ecommerce companies are scaling internationally to boost growth. The demand for non-local products (that gain an ‘imported‘ or ‘exotic‘ tag) is only increasing. About 2.2 billion users are expected to shop online globally by 2021 – that’s your market if you go global.

2. Technology

The use of technology has increased efficiency, revenue, minimized errors and facilitated a better organizational structure. You can use shipping automation software solutions or something as simple as chatbots for your customers to track or know more about their orders.

3. Multi-channel presence

Just using one ecommerce platform like eBay or Amazon is not something online sellers prefer anymore. The new trend is to have a presence on multiple channels to maximize the chances of getting sales.

4. Faster delivery

Shorter wait times and same-day delivery options are what are in demand this year. Instant logistics is a major trend. A survey revealed that 88% of online shoppers are willing to pay for same-day delivery.

5. Personalized and premium packaging

Most ecommerce companies are spending a lot of money on designing the packaging. It works great for branding and says a lot about the company. Offering the users an option to personalize packaging is fast becoming a trend. 52% of customers are willing to make repeat purchases if the online merchant offers premium packaging, while 62% were more likely to purchase from a brand that used sustainable packaging.

The Past and the Present

The evolution of shipping and logistics in e-commerce has been phenomenal, especially in the last five years. The shipping modes, costs, size of warehouses, delivery times, packaging materials are only some of the things that have undergone a change. Internet of Things (IoT), machine learning (ML), automation, real-time tracking, Artificial Intelligence (AI), etc. have brought about this evolution. And this year, the ecommerce shipping industry is set to revolutionize with about 25% of the world shopping online. Are you ready?

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Ana Shan is a product evangelist at AuditShipment.com, an AI-driven audit service that automatically captures more than 20 carrier errors and helps businesses save up to 16% of their shipping costs.

Shipping 101 For Ecommerce Platforms