This article provides considerations and best practices for shipping products sold through ecommerce.
Last Published: 5/22/2017

Once customers or businesses have used your website to purchase a product, you must determine the best way to get the product to them. Many small and new businesses choose the “do it yourself” (DIY) method when it comes to shipping and fulfillment. DIY tends to be more work, but it can save a business on costs and may make sense for those online sellers that have lower product inventory and shipment volumes. Myriad things must be considered when you have reached this step in the ecommerce process.

Here are some of the key components outlined:

  • Pricing. Not surprisingly, the more your site users are charged for shipping, the less likely they are to want to purchase your product. Online “shopping cart abandonment” is often caused by unexpectedly high shipping prices. In a study done by United Parcel Service (UPS,) 55 percent of shoppers abandoned their shopping carts before purchasing because shipping and handling costs were too high.

  • Warehousing. You also need to consider where you will store your product. If you currently have a warehouse or storage facility you use for brick-and-mortar sales, then the same facility may work. However, keep in mind that B2B transactions often involve bulk quantities, so once you are involved in B2B ecommerce, you may need to expand your space or look for other options.

  • Packaging. Another way to minimize shipping costs is to use the correct packaging. In general, smaller and lighter packaging is better, because shipments are most often paid for by size or weight. 

  • Tracking and Insuring. Major carriers include shipment tracking with their services. If you are shipping expensive items, bulk items, or items that can be easily damaged, you may want to offer shipping insurance as an option for the customer to purchase. Insurance is often offered by a third party, so make sure to do your research on the insurer and to inform the customer about the insurer. Major carriers also include some form of shipping insurance with their service as a guarantee.

  • Selecting a Carrier. You will also need to determine which carrier to use to ship your products. The major carriers used for ecommerce tend to be FedEx, UPS, and USPS.  Along with selecting a suitable carrier, you should be sure to include on your checkout page what carrier you are using and when the customer or business can expect the package.

  • Shipping Internationally. Tariffs, taxes, or duties may need to be paid for items to enter or leave a country. A good website to find accurate estimates on international duties and taxes is http://www.export.customsinfo.com, or simply contact your nearest U.S. Commercial Service office or U.S. Export Assistance Center to receive personal assistance from an international trade specialist. The customer or business that purchases the product will be responsible for paying those fees upon delivery, and it is a good idea to give customers notice of the fees, and include the proper forms and documents with the shipment to ensure that shipment will clear customs in the destination country. 

  •  Integrating Software. Services such as ShipStation, Ordoro, and ShipEasy are able to seamlessly integrate into your ecommerce platform and can provide you a one-stop shop for all of your shipping needs. They will track, invoice, label, document, integrate with multiple carriers for postage printing, and even generate data reports on shipments for your business. Those services usually charge a flat monthly rate (usually $25–$300 depending on the number of shipments your business makes) and can be accessed from your ecommerce platform’s list of plugins and extensions. Be sure to shop around the various services offered through your ecommerce platform because many have special features, pros, and cons.

     

Prepared by the International Trade Administration. With its network of 108 offices across the United States and in more than 75 countries, the International Trade Administration of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



eCommerce Industry Cost and Pricing eCommerce Supply Chain Supply Management Freight Forwarding Landed Costs Shipping Insurance Distribution