Carrier price changes along with different shipping options and shipping zones make shipping parcels more complex. The weight and size of your package greatly impacts the total shipping cost.

One of the most effective ways to target lower rates is to use alternative packing materials like poly mailers instead of cardboard boxes. Cardboard packaging is heavy, and using lightweight poly mailer bags to ship packages helps you cut down on package weight.

Similarly, cardboard box sizes are fixed, meaning its package dimensions decide the shipping costs even if there is empty space inside.

In contrast, poly mailer bags are compact, making them more cost-effective than cardboard boxes for shipping non-fragile items like sweaters and pillows. Another great way to lower shipping costs is to use packing supplies provided by your shipping carrier.

Major carriers like FedEx, USPS, and DHL offer discounted packing materials to small retail stores and eCommerce businesses. Experienced shippers know that buying packing materials like boxes, poly mailers, and dunnage in bulk achieves cost savings in the long run.

Each unit cost reduces for each parcel when you buy packaging in bulk quantity. When you self-fulfilling orders, you usually spend a lot of time receiving and processing orders. As a result, you have less clarity about the effects of shipment cost trends on your business.

A logistics intelligence tool gives you access to data analytics and automation tools that help you identify opportunities for cost savings. It lets you compare and analyze different shipment scenarios to understand true fulfillment costs. Outsourcing your order fulfillment to a 3PL, offering flat rate shipping, and investing in a logistics solution are just a few simple ways you can reduce shipping costs and better manage the impact of carrier rate changes on your business.

Sifted Logistics Intelligence offers tools for shippers to better optimize and understand their shipping costs and where they can be reduced. Ready to protect your business from shipping fee changes?

Get a demo with Sifted today! Categories: All. Tags: All. Decision Support See how supply chain adjustments pay off before you pay out.

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Apple Podcast. Google Podcast. by Sifted Team. Jun 17, View All Articles. Peak Season Shipping Checklist. Download Now. Consider outsourcing portions of order fulfillment to a 3PL. Weigh packages and reduce dimensions. Offer a flat rate shipping fee to all customers. Look into offers from platforms and marketplaces you sell on.

Choose the right packaging. Utilize a logistics intelligence tool. Optimize your shipping costs with Sifted Logistics Intelligence Outsourcing your order fulfillment to a 3PL, offering flat rate shipping, and investing in a logistics solution are just a few simple ways you can reduce shipping costs and better manage the impact of carrier rate changes on your business.

Topics: Shipping Costs , Shipping Data , Supply Chain Operations. Check out related resources at Sifted. Categories: All All Categories Articles Videos Breaking News Featured In the Press COVID Partners Guide. Parcel Carrier Comparison Guide. In the intricate landscape of parcel shipping today, shippers navigate a complex web of carriers, each with its Amazon took the supply chain world by storm in They announced Amazon Shipping, a FedEx and UPS competitor Over the last few years, soaring shipping costs, unpredictable rate hikes, and a challenging logistical landscape Kansas City, Mo — Sifted, a leader in Logistics Intelligence, has been recognized as a Top Tech Startup by Breaking News.

USPS Announces Tentative Rate Increases for The United States Postal Service has announced rate increases Experts Share Attention-Grabbing Items from GRIs Supply Chain Dive interviewed industry experts, including It will be if your customers receive their orders on time.

The major In true duopoly fashion, FedEx and UPS have announced the same FedEx Announces Deadlines for Holiday Shipments FedEx has published dates that domestic packages must be sent Are you an FBM fulfillment by merchant Amazon seller? Check out our Marketplace Intelligence solutions to protect your bottom line.

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If multiple packages go to the same destination, multiweight pricing can also help reduce shipping costs. This will allow you to incorporate numerous packages into one shipment, resulting in lower shipping costs than shipping each package individually.

UPS also offers a ground with freight pricing option to reduce the costs of multiple packages going to one location. FedEx and UPS offer discounts to specific customers, including small businesses, non-profits, and eBay sellers.

Check if you are qualified for third-party discounts and take advantage of them to reduce your shipping costs. Check with trade associations or organizations for member discounts if your shipping volume is seasonal or low. Additionally, American Express offers promotions on FedEx shipping. International shippers can also use the FedEx Great Rates program to ship internationally.

Airplanes have a set amount of space to transport packages, and if an aircraft is not full, it is beneficial for the carrier to fill it up. So, FedEx will offer reduced rates on ready-to-go packages to maximize space on the already scheduled flight.

Regularly review and tweak your shipping preferences, such as address verification, delivery confirmation, and insurance. You can reduce FedEx and UPS shipping costs and save money by ensuring your settings are precise and appropriate for your shipping requirements. If your shipping software has address validation, use it.

Packages will arrive on time and reduce the amount of address correction fees on your invoices. UPS and FedEx offer a money-back guarantee on packages delivered late. If a package is delivered more than a minute after the guaranteed delivery, your company would be eligible for a refund for the shipping charges.

Unfortunately, this has temporarily changed after COVID. Currently, UPS guarantees on-time delivery for next-day air and international express packages. FedEx guarantees on-time delivery on all service levels for members of FedEx My Rewards.

Did you know: Refund Retriever specializes in finding late deliveries in your company's billing invoices. Evaluating the FedEx and UPS terms and conditions, pricing policies, and shipping guidelines will enable you to understand your shipments' costs fully.

It is a good idea to periodically review your shipping costs and explore different alternatives to find the most cost-effective shipping solution for your shipping needs.

If you need more help, reach out to Refund Retriever today! This post is accurate as of the date of publication. Some features and information may have changed due to product updates or Amazon policy changes.

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Prepay shipping to save money on shipping labels Factor in all fees Work with providers

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Reduced shipping fees - Use the “right” packaging Prepay shipping to save money on shipping labels Factor in all fees Work with providers

UPS Ground is faster than ever, and is their most competitive service for shippers looking to save money while getting their packages to customers quickly. Exclusive to Pirate Ship, simplify your business's international shipping with the cheapest international shipping rates available.

Increasing your international sales and make shipping easier. UPS Ground Saver is their most affordable service, ideal for non-urgent, low value shipments where getting the lowest shipping rates is the most important factor.

Priority Mail offers the best way to ship packages with USPS, with an ideal mix of fast speed and low cost. Learn about its 3 different rate structures—Weight-Based, Dimension-Based Cubic, and Flat Rate. If your package is around the size of a shoebox or smaller, it's perfect for this secret dimension-rated service that lets you ship up to 20 pounds for no additional cost.

Is your package too big to qualify for Cubic rates? But you can still get incredible shipping rates with weight-based Priority Mail just watch out for Dimensional Weight pricing if your box is large! Priority Mail Flat Rate Envelopes® and the Small Flat Rate Box® are incredible deals, but otherwise it's always cheaper to ditch the free packaging and use your own packaging instead of paying a premium.

For packages that need to arrive overnight, with options for faster Next Day Air Early or cheaper Next Day Air Saver® end-of-day delivery. If time is of the essence, 3 Day Select is a great service if you want to be sure your packages will get to your customers within three business days.

The most affordable UPS service for packages that need quick delivery within 2 days, with an option for morning delivery with 2nd Day Air AM. This is the fastest service USPS offers, but note that it's only overnight delivery in urban areas, with 2 day delivery to or from rural areas.

New in July , USPS has merged First Class Package and Parcel Select into the new Ground Advantage. This is the cheapest, slowest service USPS offers. Pirate Ship automatically rate shops between Weight-Based and Cubic rates for Ground Advantage, ensuring you'll always get the cheapest rate possible for your Ground shipments.

Dimension-based rating for the slowest service USPS offers for packages over 1 lb, with day delivery estimates. If you only ship educational materials like books, music, or films, and never include any other products or advertising, this is the cheapest way to ship.

Your packages may be inspected to ensure compliance. The cheapest international service USPS offers for packages that weigh less than 4 pounds. This is the cheapest USPS service if your packages are over 4 pounds, or if you want them to arrive faster.

This is the fastest international USPS service on Pirate Ship, with 3 to 5 day delivery excluding customs. UPS Standard offers affordable rates for shipments going to Mexico and Canada that don't need the fastest delivery.

Ideal for non-urgent international shipments with day delivery, depending on the country. Cost-effective 1 day delivery to Canada, 2 day to Mexico, and 3 day delivery to major international cities.

If you do this and see that most of your orders are coming from across the country, you may want to consider using a fulfillment center that's closer to your customers to reduce the number of zones your product crosses and the amount you spend on shipping.

This is a good point to conclude with our lucky shipping tip A third-party logistics 3PL partner such as The Fulfillment Lab can also save you a bundle, offering low-cost shipping for small businesses!

When you work with us, we will ship your product from one of our locations that are closest to your customer to avoid excess zone charges and pass some of our negotiated carrier shipping discounts on to you.

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Print Postage at Home You may know that shipping labels can be printed at home, but did you know you can also print postage at home?

Use Third-Party Insurance One way UPS, FedEx, and other carriers make their money is by overcharging customers for insurance costs. Watch Your Dimensional Weight Applying dimensional weight to shipments is fairly new for carriers, and many small businesses don't know what it's all about.

Increase the Price of Your Product Are you offering free shipping and finding it to be too expensive? Consider a Multi-Carrier Strategy Often, busy shippers will simply choose a single carrier strategy and negotiate a reasonable rate.

More Negotiation Power. Without an exclusive carrier, business owners are more likely to keep up with the services and prices others offer. In addition, carriers may not offer existing customers their most competitive service options or rates, similar to cable companies.

The Right Service for the Right Job. S ome carriers are better than others for different types of shipments. international, oversized shipments, etc. Risk Mitigation. In a multi-carrier scenario, when service goes bad with one carrier, you can switch to another. Providing customers with accurate tracking information enhances their experience and reduces customer inquiries.

Resort to carrier-provided tracking systems or third-party solutions. Consider an outdoor equipment retailer; by integrating real-time tracking on their website, customers can monitor the progress of their camping gear delivery, reducing uncertainty and improving satisfaction.

Efficient return management helps to reduce shipping costs and enhances customer satisfaction for return orders. Offer clear return policies and provide prepaid return labels for customers. Imagine a clothing retailer implementing a hassle-free return process.

By providing customers with a prepaid return label and detailed instructions, they not only reduce the return shipping cost but also make the return experience convenient for shoppers.

Regularly auditing your shipping invoices is one of the best ways to reduce shipping costs due to billing errors. Shipping invoices can sometimes contain errors or discrepancies that result in overpayment.

Regular audits help in identifying such errors and rectifying them promptly. A real-life example is an online gourmet food store. By routinely reviewing their shipping invoices, they discovered a billing error that had been consistently charging them extra for certain shipments, leading to substantial cost savings after correction.

By focusing on these efficiency enhancement methods, you can not only reduce shipping costs but also create a smoother, more transparent shipping experience for your customers. Having well-defined shipping policies and terms can not only save money but also enhance customer satisfaction.

Clear shipping terms and policies communicate expectations to customers and reduce bitter surprises that may lead to an increased average shipping cost. Consider offering a range of shipping options such as standard, expedited, and overnight. An example is an online electronics retailer that offers customers the choice between standard shipping with an affordable shipping fee or faster-expedited shipping with expensive pricing.

By providing options, customers can align their preferences with their budget and urgency. Additionally, communicate any restrictions or fees associated with certain shipping zones. For instance, a seller of delicate glassware may have specific shipping policies for international orders to ensure safe delivery, which could include additional handling fees.

By transparently detailing your shipping terms and policies, you can reduce international shipping costs, manage customer expectations, prevent misunderstandings, and avoid unnecessary costs that might arise from rushed deliveries or unexpected fees.

Sourcing shipping materials efficiently can help you lower shipping costs. Purchase packaging materials in bulk to take advantage of shipping discounts. You can also Invest in a postage scale to measure the weights of the shipping packages for accuracy.

Consider eco-friendly and lightweight packing material. Sourcing biodegradable packaging materials not only helps in reducing shipping weight but also can save on shipping costs and build a positive brand image. Furthermore, you can partner with packaging suppliers to negotiate better rates.

Some suppliers offer customizable packaging solutions that optimize size and durability, which can help you reduce shipping costs due to reduced packaging costs.

By carefully sourcing shipping materials and being transparent about your policies, you demonstrate professionalism and commitment to customer satisfaction. In turn, it can result in packaging costs and improved customer loyalty. Shipping costs can be influenced by numerous factors like increased customer demand, shipping distance from origin, weight of package, delivery speed, fuel surcharges, and carrier shortage.

The cheapest shipping method for small businesses is using standard ground shipping from large carriers like USPS First Class Mail. For small packages, flat-rate shipping boxes offered by USPS can be the best choice.

These boxes allow you to ship items at a fixed rate, regardless of weight, as long as they fit within the designated box size. Shipping large packages can often be more affordable through USPS Priority Mail freight services, which handle heavier and bulkier items.

Freight shipping providers offer competitive rates for larger shipments by utilizing different pricing models than traditional small package carriers. Offering free packaging and shipping has become common nowadays.

To counter this, you can offer free shipping for threshold orders or incorporate the shipping cost into product prices. The ideal shipping method depends on your specific business needs, product types, delivery timeframes, and budget.

Standard ground shipping is a common choice for balancing cost and speed, while expedited services suit time-sensitive deliveries.

Assessing your requirements will help you determine the best fit. To factor in shipping costs, consider variables such as package weight, dimensions, delivery speed, shipping destination, consumer demand, seasonality, and carrier rates.

Use shipping calculators, tools, or software provided by major carriers to estimate costs accurately. With e-commerce giants like Amazon setting the benchmark for rapid and free shipping, smaller businesses find themselves in fierce competition. To lower shipping costs, a calculated approach is required that combines technology, data analysis, and creative solutions.

With these methods under your hood, your business charts its course toward streamlined shipping operations, competitive resilience, and profitable growth. Rakesh Patel, author of two defining books on reverse geotagging, is a trusted authority in routing and logistics.

His innovative solutions at Upper Route Planner have simplified logistics for businesses across the board. A thought leader in the field, Rakesh's insights are shaping the future of modern-day logistics, making him your go-to expert for all things route optimization.

Read more. Sign Up with Upper Route Planner and automate your daily business process route planning, scheduling, and optimizing!

Reduced shipping fees - Use the “right” packaging Prepay shipping to save money on shipping labels Factor in all fees Work with providers

Work with your fulfillment warehouse to find better ways to package your products to avoid DIM weight charges. If you can consolidate your orders into fewer boxes, you can save a lot on shipping.

Each kit weighs 10 pounds. The kits are securely packaged and can be shipped without an overbox. When people order multiple kits, you ship them individually in their boxes.

Consolidating your orders into fewer boxes is one of the best ways to reduce shipping costs. This may also make it easier to offer discounts on volume sales.

Expedited shipping charges can slaughter your bottom line. In general, ground shipping will be more expensive than air shipping , and you will trade time for money. The best way to avoid expedited shipping charges is to process your orders quickly. Instead, handing it off to the carrier sooner gives you a better chance to meet delivery expectations.

If a customer has paid for expedited shipping and the order leaves the warehouse late, you could lose money. You might need to use a faster delivery service and pay the difference. Note that in and , this may not be as big of an issue as in the past.

However, you can get your orders out faster. Work with a fulfillment center that offers same-day order processing. You want them to discuss order processing and not necessarily same-day shipping or same-day delivery. Those other terms can confuse customers and set expectations of immediate delivery, which is generally not feasible — or necessary — for nearly all eCommerce businesses.

This distinction protects your business. That same-day guarantee ensures that orders are never sitting and waiting on processing, which can cause delays and mean things still take weeks even using expedited shipping. We call that our order-processing guarantee to help everyone understand the speed discussed.

You can make this even better by integrating directly with your eCommerce platform to give customers the most accurate estimates for fulfillment speeds. Moving your products closer to your customers saves on eCommerce shipping costs and delivery time.

Shipping zones determine shipping costs. The zones correspond roughly to the distance between the point of origin and the destination of the package. A package shipped to Zone 2 will cost less than one shipped to Zone 8.

You can reduce your shipping zones by working with an eCommerce fulfillment company that has multiple warehouses. The closer a warehouse is to the customer, the more you can reduce your shipping costs.

There are some logistics involved in distributing your products among multiple warehouses. The number of warehouses that make sense for you depends on your business size and order volume. Amazon has hundreds of warehouses across the country to deliver a high volume of orders quickly.

Speaking of your packing materials, this is another area where you can cut down on costs. By identifying the smallest reasonable packaging filler you need, you can save money on the cost of those materials and the cost for the shipping itself.

In fact, air pillows add almost no weight to freight shipments. It might require a bit of digging, but there are volume discounts and special packages out there that combine hybrid services from multiple partners carriers, warehouses, etc.

This way, you can save money while also streamlining your fulfillment services and shipping workflows. Alternatively, your company can also search for discounted shipping supplies.

Large shipping carriers, like UPS and FedEx, will often provide discounted or free packaging materials to small business owners. Unfortunately, too many retailers stick with the first shipping carrier they come across.

You can do this rate shopping with all major carriers for all service levels and special service requests—like Saturday Delivery and Hold at Location, for example. You can either visit their local offices and speak with them in-person, or call them up to talk through your total costs.

Last, but not least, working with a third-party logistics 3PL company can reduce your shipping costs in a big way. For many reasons, teaming up with a 3PL is the best way to achieve cost savings while also preserving your shipping speed. And because 3PLs ship from multiple warehouses and fulfillment centers, you can reduce the distance orders are traveling and shrink costs as a result.

Partnering with a 3PL saves you on shipping insurance. The insurance with a 3PL is much cheaper than buying your own—and in some cases, it even cuts the price in half , and will help you to avoid insurtech regulatory issues. The primary benefits of working with a 3PL are:. All in all, 3PLs help with everything from order fulfillment and logistics to quality control services.

Due to their wide-ranging skill set, 3PLs do a ton of work on your behalf so you can focus more on growing your business—like expanding your sales channels or developing new products. Optimizing packaging is crucial to reduce shipping expenses. Start by using appropriately sized packaging to avoid dimensional weight charges, opting for lightweight materials to minimize overall weight without compromising protection.

Utilize flat-rate options when applicable and fill empty spaces in packages to prevent excess dimensions. Customized packaging tailored to your product's size, considering reusable or eco-friendly materials, can significantly cut costs.

Consolidating shipments, comparing packaging material prices, negotiating with suppliers for optimized packaging, and staying updated on carrier policies are additional strategies to find the cheapest way to manage shipments.

Effectively managing returns to decrease shipping expenditures involves implementing clear return policies and providing prepaid labels selectively, consolidating returns where possible, and establishing processes like RMAs to control and streamline returns. Optimize return packaging, analyze return patterns to address recurring issues, and consider local partnerships or centers to consolidate returns geographically.

Continuous assessment of product quality and prompt handling of returns are vital to reducing unnecessary return shipments and associated shipping expenses.

To save on international shipping costs, optimize packaging, consolidate shipments, and consider setting up distribution centers closer to international markets. Negotiate rates with carriers, compare shipping methods based on speed and cost, and leverage free trade zones or agreements.

Ensure accurate customs documentation, manage duties and taxes efficiently, track costs for analysis, and offer customers multiple shipping options.

These strategies collectively help lower shipping rates while maintaining efficient global delivery services. Matthew Rickerby is the Director of Digital Marketing at Extensiv, the leading solution for multichannel, multi-warehouse D2C brands. Cash flow is the lifeblood of any business, and third-party logistics 3PL companies are no exception.

Effective cash flow management is essential for the success of a 3PL business—in both the short [ With consumers returning [ Home Blog From Expense to Efficiency: How to Reduce Shipping Costs Effectively.

Third-party logistics providers can help businesses save money on shipping costs by leveraging their existing relationships with carriers. These providers can often negotiate better rates and handle logistics and transportation for businesses.

Regularly evaluating shipping costs can help businesses identify areas for improvement and make adjustments as necessary to reduce costs. This can involve analyzing shipping data, comparing rates across carriers, and making changes to packaging and shipping methods.

When selling online, determining accurate shipping costs is essential to ensure that customers are charged the correct amount and that the seller is not losing money on shipping. Here are some steps to determine shipping costs when selling online:.

Determine the weight and dimensions of the product: The weight and dimensions of the product are key factors in determining shipping costs. You can use a digital scale to measure the weight of the product, and a tape measure to determine its length, width, and height.

Choose a shipping carrier: There are several shipping carriers to choose from, including USPS, UPS, FedEx, and DHL. Due to variations in rates and shipping options among different carriers, it is essential to conduct thorough research and compare the costs and services provided by each carrier.

Calculate shipping costs: Once you have determined the weight and dimensions of the product and selected a shipping carrier, you can use the carrier's shipping rate calculator to determine the cost of shipping. Most carriers provide online calculators that allow you to enter the origin and destination zip codes, package dimensions and weight, and shipping service to calculate the cost of shipping.

Consider shipping materials: The cost of shipping materials, such as boxes, envelopes, and packing materials, should also be factored into the shipping cost. Some carriers offer free shipping supplies, while others charge for them.

Offer shipping options: Depending on the product and customer's needs, offering different shipping options can be beneficial. For example, offering expedited shipping for an additional cost can be appealing to customers who need their product quickly.

Update your online store: Once you have determined the shipping costs, make sure to update your online store to accurately reflect the shipping options and costs available to customers.

Engaging in such research and comparisons will effectively prevent any potential confusion or disputes with customers regarding shipping costs.

FarEye is a comprehensive delivery management platform that empowers businesses to optimize their delivery process, enhance efficiency, and ultimately achieve reduced shipping costs. With features such as route optimization, real-time visibility, data analytics, automation, and delivery experience, FarEye offers a comprehensive solution to reducing shipping costs.

Route optimization is a key feature of FarEye, which uses AI and machine learning algorithms to find the most efficient route for delivery.

Implementing such measures can effectively decrease fuel expenses, enhance delivery times, and ultimately result in reduced shipping costs. Real-time visibility is another feature that enables businesses to identify inefficiencies in the delivery process and take timely interventions to avoid delays, further reducing shipping costs.

Additionally, FarEye's data analytics capabilities provide valuable insights into delivery performance, which can help optimize the delivery process and reduce shipping costs over time.

In summary, FarEye provides a diverse range of features that enable businesses to minimize their shipping costs and enhance their delivery process. Komal Puri is a seasoned professional in the logistics and supply chain industry. As the Senior Director of Marketing and a subject matter expert at FarEye, she has been instrumental in shaping the industry narrative for the past decade.

Her expertise and insights have earned her numerous awards and recognition. Negotiate with carriers:. Use a shipping platform:.

Optimize packaging:. Offer free shipping on orders over a certain amount:. Use real-time carrier rates:. Use flat-rate shipping boxes:. Take advantage of USPS Priority Mail:. Use hybrid services:. Use third-party logistics providers:.