Before your first order, you must decide how you want to send your products to customers and how much to charge them for shipping. You can combine several shipping strategies in your store in order to cover all of your products and delivery locations, and you may need to customize shipping options for certain products or services.
Calculating shipping costs
Different factors can affect the actual cost of sending your products to the buyer, such as:
Package weight and dimensions. Shipping carriers like USPS, FedEx, and UPS calculate shipping charges based on the actual weight of the package or its dimensional weight.
Shipping destination. Your shipping costs will be higher if you offer international shipping in your store.
Value of shipped products. If you sell high-value products, you may want to insure their shipment, which will increase shipping costs.
Delivery times. Some buyers prefer to pay for expedited shipping; this cost is based on where the buyer is located.
After you find a shipping service to use, calculate your shipping costs to choose a shipping strategy and decide what price to sell the products at. If your margin is high, you may want to absorb the costs of shipping domestic orders and offer free shipping to your local customers. To compensate for shipping expenses, you can slightly increase product prices in your online store.
Alternatively, you can charge your customers the exact amount that you pay for getting their order shipped. Use online calculators — such as UPS rates calculator, USPS rates calculator, FedEx rates calculator — to check how much shipping carriers charge to ship products of different weights and dimensions to different destinations from your location.
Choosing a shipping strategy
Once you’ve calculated the shipping costs for your product line, you will need to set it up and decide whether you, the buyer, or some combination will pay for the shipping expenses. You can add as many shipping methods as you need to cover all of your products and destination zones.
If you have an offline store, you can offer a local pickup to those customers who prefer to purchase online and then pick up orders themselves. It’s a good idea to offer a local pickup even if you do not have an offline store.
This is a common practice for schools whose coaches and staff will have products on campus. Choose local pickup and provide specific instructions regarding logistics (e.g., front office or email a specific person to arrange for you or your student to pick up the item).
You can offer a free pickup, charge a small fee (to compensate for delivering products from your warehouse to the pickup point), or give a discount to customers who have chosen pickup at checkout (such as a discount coupon with their order).
Statistically, shipping cost is one of the main reasons why shoppers abandon shopping carts. Consider offering free shipping whenever you can to increase conversion in your online store. To compensate for your shipping expenses, you can slightly increase your product prices.
You can also offer free shipping on orders over a certain subtotal amount to encourage customers to buy more. Or you can offer free shipping to certain customers by giving them a discount coupon code that they can redeem at checkout.
Exact shipping cost
If you use a popular service like USPS, Fedex, or UPS to ship your products, you can set up your store to receive automatic online shipping rates from carriers at checkout and charge your customers the exact rate that you are paying these carriers for each order.
If you are using the service of a carrier that is not integrated with Store for live rates, you can manually add this carrier’s shipping rates for various order weight ranges.
If you deliver products yourself or your products have a similar weight and size, you can offer flat-rate shipping for delivering your products to the customer’s location.
If you need a more complex shipping cost calculation than flat rates, consider using tiered rates based on order subtotals or different order weights. You can use flexible tiered rates to charge different shipping costs for different order subtotals to charge for shipping large products by freight, or to charge for any other shipping setup you may want to have in your store.
Offering specific payment methods depending on shipping choice
You can provide better customer experience by connecting specific payment methods with particular shipping options in your store. That way, your customers will see only the payment methods you choose for certain shipping/delivery.
To offer a payment method for certain shipping methods only:
Go to Payment.
Select the method you want to set up and click “Edit.”
Scroll down to “Payment method availability based on shipping choice” and click “Limit availability by shipping method.”
Click “Select Methods” and check boxes for all the shipping methods you want this payment to be available to. Then click Select.
Now your customers will only see this payment method if they choose the shipping methods you picked up for this payment option.
Optimizing shipping rates
You may need to cover extra expenses related to packing and shipping products to customers. You can charge your customers a small extra fee using one of these options:
Handling fee. This fee applies to all orders and is shown at checkout as a separate line. It is typically used to compensate for the time and cost it takes to package an order.
To cover the shipping expenses just for certain products (e.g., for fragile or large items in your product line), you can add a hidden fee as a fixed rate per item on top of your regular shipping costs.
Shipping markup. This hidden fee is added to the live rates returned by the carriers that you’ve enabled in your store.
If you are using real-time shipping rates from the integrated carriers, specify the right product weight and product dimensions so that accurate shipping rates are paid by your customers at checkout.
If you have negotiated shipping rates with a carrier and want to offer these discounted rates at checkout, add your own account information with this carrier in your store’s settings instead of using our default account.
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