In the e-commerce world, there are a lot of important questions to ask as you’re setting up your business: How much should I charge for my products? What is the best way to market my business? How can I connect with potential customers?
Once you’ve answered those questions, there remains one more vital question: How will I ship products?
Fortunately, we’ve got you covered in this guide that will teach you everything you need to know about ecommerce shipping solutions.
By the end of this post, you’ll know how to choose a shipping method for your company.
Choosing a Shipping Carrier
Your first step is figuring out which carrier you should use to take your products from where they are to your customers.
There are three shipping carriers that most businesses prefer:
- The United States Postal Service (USPS)
- United Parcel Service (UPS)
- FedEx (originally Federal Express)
How you choose which of these will work best for you will depend on a few factors. Next, we’ll go over the three factors to consider when looking at these carriers.
Availability
Each carrier will have different availabilities depending on how much you’re shipping and where you’re shipping to. For example, shipping to Army Post Office addresses can only be handled by the USPS.
For the most part, if you’re sending an individual package, you can use any of these three carriers. However, if you’re planning on selling products wholesale and shipping large quantities that require pallets, you’ll likely need to use a freight company instead.
Reliability
Because all of these carriers have been around for so long, they have earned their place as a reliable package delivery company. So, when it comes to reliability, all three are essentially equal.
Cost Effectiveness
You want to make sure that you’re choosing a shipping method that’s cost effective for both you and the customer. There are a few questions to ask that will help you determine which is best.
- How far will the package be traveling?
- How much does the package weigh?
- What are the dimensions of the package?
- How quickly does the package need to arrive?
If you have a variety of products for sale, you may find that different methods work best for each product. For example, USPS ships primarily by weight, so a large but lightweight package would be more cost effective through them than another company.
Order Fulfillment Options
The other half of the ecommerce shipping question is who is handling the shipping. This is known as order fulfillment. There are three options: in-house, outsourcing, and dropshipping.
Keep reading to find out more about each of these order fulfillment methods.
In-House Order Fulfillment
This method is most commonly used in small and mid-sized companies who don’t ship enough for outsourcing to be cost effective for them. It involves the company itself being responsible for packaging and shipping out products.
Another reason companies may do in-house order fulfillment is if they create customized products. In this case, it makes more sense for them to create then ship out the product themselves.
Large companies that do their own in-house order fulfillment typically have consistent orders. This allows them to know how much they’re going to spend on shipping every month which offsets the fixed costs that come with in-house order fulfillment.
Outsourcing Order Fulfillment
Companies of all sizes can save money and improve customer experiences by outsourcing their order fulfillment to a third-party shipping company.
With this type of order fulfillment, your products are stored and shipped by another company. This prevents the need for warehouse space and allows orders to be processed quickly.
Another advantage of this method is that it’s scalable. As your company grows, you can easily add to the amount of warehouse space you’re using with the shipping fulfillment company. This is far easier than needing to search for a larger warehouse to buy or rent.
You can also scale down if you have seasonal items, so there’s no need to pay for warehouse space you’re only going to use a few months of the year.
Keep in mind that outsourcing is different from dropshipping, which we’ll discuss next. You can learn more now about the differences between these two order fulfillment methods.
Dropshipping Order Fulfillment
The third and final order fulfillment option is dropshipping. This is when your products are shipped directly from your suppliers to your customers.
Dropshipping eliminates the need for a warehouse and allows you to only sell products that have been ordered, but can be more expensive to have products made on-demand.
Another drawback to dropshipping is that it can take longer since often, products are created after the order is placed. This may make it impossible to offer faster shipping options to your customers.
Even so, this is a popular option and is used by companies of all sizes.
Which Method to Ship Products is Best?
As you can imagine, there’s no one shipping method that’s the best for every company and every product. Fortunately, with so many options, it’s easy to find one that meets your specific company needs.
Here are some questions to help you figure out which method will be best for your company:
- How many products will you be shipping at once?
- How many packages are going out every day?
- What equipment and supplies will be needed for in-house shipping?
- What is the average weight of each shipment?
- How valuable are the products? Is order confirmation needed?
- How much can you expect the customer to pay for shipping and handling?
Once you have a better idea of what your shipping needs are and will be, you can determine which shipping carrier and method will help your company reach its full potential.
Remember that you can always change things later if you find that what you’re doing isn’t working for you. So, don’t be afraid to try out a few methods before you find one that clicks.
More Business Articles
Now you’ve learned everything about ecommerce methods to ship products. You’ve also been given the questions needed to determine which is best for you.
If you want more business articles, be sure to check out the business section of our blog. There, you can find tons of information, tips, and tricks to help you grow your business.
