June 15th, 2023

How to Reduce Shipping Costs in E-Commerce

What strategies and measures can an e-commerce business implement to reduce shipping costs while still providing quality service? For e-commerce, reducing the cost of delivering sold products is of fundamental importance. The growth of online sales recorded worldwide in recent years has enabled online businesses to expand and strengthen their offerings, but at the same time, it has created the need for investments in adaptation...

What strategies and measures can an e-commerce business implement to reduce shipping costs while providing quality service?

For e-commerce, reducing the cost of delivering sold products is of fundamental importance.

The growth of online sales worldwide in recent years has enabled online businesses to expand and strengthen their offerings, but it has also created the need to invest in adapting logistics processes, such as warehousing and transportation, to respond promptly to the changing habits and needs of an increasingly segmented market. Shipping costs are among the factors that most impact the financial statements of companies selling online, with delivery often entrusted to external partners, courier services, and logistics experts whose key task is to ensure products arrive at their destination exactly as specified during the purchase phase.

This final stage of the process, when managed professionally, can contribute to the development of a profitable business while influencing the choices of online shoppers. According to data from the Baymard Institute, 45% of consumers who start an online purchase but do not complete it (a phenomenon known as “cart abandonment”) do so because they consider shipping costs too high, while 22% abandon their cart due to long delivery times.

Therefore, it becomes crucial for companies to optimize shipping costs by relying on external experts, while minimizing the impact of poor management on the end customer. Aligning logistics processes with consumer needs allows for fast delivery, reliable timelines, and personalized service. Let’s explore the strategies that online retailers can implement to achieve this.

75% of users who regularly use the internet have purchased products or services online in the past 12 months.Online shopping is currently growing at a rate of over 10% per year.

Strategies for Optimizing Shipping Costs

According to a study conducted by Eurostat, 75% of users who regularly use the internet purchased products or services online in the past 12 months, while the latest European e-commerce report indicates that online shopping in Europe is currently growing at a rate of over 10% per year. These are significant figures that, on one hand, highlight the potential of this ever-expanding sales system, but on the other, oblige entrepreneurs to make careful investments and meticulously plan every stage of the supply chain. For some companies, the costs of managing goods are high, and entering a market where competitors can offer exceptionally favorable shipping terms is far from easy. Several factors come into play, including the weight, size of the package, and type of packaging—let’s take a closer look.

Size and Weight. The base price is usually calculated based on volumetric weight, meaning the ratio between the actual weight and the dimensions of the package. This varies from courier to courier.

Destination. The destination of the package affects the price charged by the carrier. The calculation is based on the location of the recipient and the pick-up point. These areas, known as zones, are subject to different tariffs that can influence the final cost.

Type and Packaging of the Product. The value of the delivery contents also significantly impacts the final price. Shipping items like bottles of wine, artwork, or valuable products in general may require special packaging, insurance, or specific documentation, all of which increase the shipping cost.

So how can shipping costs be best optimized? The most cost-effective approach is to choose each time the service that best meets your needs according to the requirements of each customer. Here are some useful tips to reduce these costs and improve the efficiency and competitiveness of your business:

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Adjust Packaging Size to the Products. Improving the size-to-weight ratio based on the type of products sold is possible and offers multiple benefits. First, carefully analyze product characteristics and avoid overly large boxes and wraps, which would require adding internal packing material and increase weight. Corrugated cardboard boxes, slightly larger than the item being shipped, prevent damage to the contents and use only the necessary packaging: expanded polystyrene, air cushions, and bubble wrap are ideal solutions to avoid adding extra weight and achieve the most favorable courier rates. A practical solution for e-commerce could be outsourcing, relying on experts who can offer a wide range of services and tariffs tailored to your needs.

Choose the Carrier Based on the Destination. For e-commerce businesses selling domestically and internationally, it is crucial to carefully evaluate the route goods must take to reach their destination through multiple delivery services, whether international companies or local providers. In this context, it is important to consider using multiple courier companies that can offer competitive rates—companies with a broad international network of pick-up and delivery points that also provide additional benefits in terms of convenience and service personalization.

Automate Labeling and Tracking. Organizational management behind package shipments carries significant costs for online retailers. Qualified staff and proper training for organizing documents, printing and applying labels, and tracking shipments are key aspects of e-commerce. Additionally, using external companies that work with advanced technologies and tools can reduce shipping costs, minimize errors and issues, and ensure high-quality service.

Focus on Packaging. The choice and quality of packaging are directly linked to the type of goods being shipped. Fragile items, such as wine, must be carefully packed to prevent damage and ensure proper protection during transport. However, this requires highly skilled workers and high-quality materials. It is good practice to entrust this task to specialized companies that possess complete know-how for various types of products and packaging.

Mail Boxes Etc. is the ideal partner for reducing national and international shipping costs, offering a wide range of solutions that can enhance the consumer shopping experience. Choose MBE and take advantage of a unique and flexible service, with specially designed packaging selected based on the type of goods and tailored to the needs of your business and your customers.

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Mail Boxes Etc./MBE centers operate through independent franchisees under the MBE brand. Through its franchise network, Mail Boxes Etc. provides support services for businesses and individuals. Logistics and shipping services are MBE’s core offerings—facilitated through agreements MBE makes for the benefit of its franchisees with major domestic and international express couriers—along with other graphic and printing services, provided either directly or through agreements with large printing centers. Promotion of services to business and private customers is carried out as part of the business activities of each MBE franchise partner, both inside and outside MBE centers ("farming"). Each franchise partner is contractually obligated to perform such activities. Mail Boxes Etc. and MBE are registered trademarks used with permission from Fortidia – a registered trademark of MBE Worldwide S.p.A – (All rights reserved). Services offered by individual MBE centers may vary by location. The materials available on this website, the information contained herein, and any other relevant data may not be copied, distributed, modified, republished, reproduced, downloaded, or forwarded to third parties in any way without the express prior written consent of Sistema Italia 93 S.r.l. We accept no responsibility for unauthorized use of the materials, information, and/or data available on this website.


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