10 Ways to Reduce Shipping Costs for Your Business

As your business grows, so do your shipping costs, often to the point where they become an enormous expense that threatens to drain your profits. Luckily, there are plenty of ways to keep your shipping costs under control and even reduce them over time. Follow these tips from BizFilings’ experts on how to save money on shipping costs by cutting out waste and better utilizing the resources you already have in place.

1) Understand how shipping costs are calculated

Before you can determine how you’ll save on shipping costs, it’s important to understand how these costs are calculated. The biggest factors that impact your shipping costs are size and weight; additional factors like fuel prices, packaging, and service type can also play a role. To really get a handle on these costs, consider using an online freight calculator or third-party software that can help simplify shipping calculations.

2) Verify all shipping information

Accurate shipping information is essential, whether you’re shipping one package or 100. If a customer doesn’t have access to their delivery address, they might not be able to get their purchase—putting your business at risk. Confirm all delivery addresses so that your packages reach their destination safely and in a timely manner.

3) Use an appropriate carrier based on the items being shipped

If you’re shipping sensitive items, use a carrier with a good reputation for package tracking and insurance coverage, such as FedEx. This is important if something is damaged or lost. If you’re shipping high-value items, choose only carriers that provide proof of insurance coverage. This will ensure that your business is protected in case of damage or loss.

4) Find alternatives when you need something fast

Small business owners may take more chances than large corporations when it comes to shipping. Some companies may want a product right away and are willing to pay more for speedy delivery. If you’re not in a rush, shop around and check out how much other companies charge to ship an item at different speeds. You might be able to find a cheaper option or two from which you can save money on shipping costs if needed.

5) Save money on shipping labels with free apps

Print labels directly from your computer and a smartphone app. Amazon has free apps for both iOS and Android that allow you to print shipping labels directly from your smartphone, saving you money on printer ink. You can even access shipping rates from services like UPS, FedEx, and USPS before you print your label. In addition, most of these apps offer tracking capability so that you can keep tabs on shipments as they travel from origin to destination.

6) Ship multiple orders together to save

When you’re shipping out multiple orders from one address, request a bulk shipping discount. You can also request a specific carrier (like FedEx over UPS) or delivery time frame (like second-day delivery instead of next-day). If you ship frequently with that carrier, ask if they can give you a volume discount.

7) Factor in travel time when calculating costs

One of the most overlooked expenses when determining a final price tag is shipping time. The faster you can get your product from Point A to Point B, the more customers will likely value it. If you’re selling something with a long shelf life, it might be worth spending extra on expedited shipping options—or even drop-shipping options that allow your customer service team to directly handle fulfillment requests.

8) Analyze rates from the perspective of the shipping company

Don’t assume you’re getting charged a fair rate. Find out what your shipping provider is paying, what expenses they have, and where else you can ship to or from that might cost less. They’ll need a few weeks of data on your current rates before they can begin providing new options, but if you can find savings in other ways first, it will put pressure on them to give you a better deal.

9) Use a heavy box, but be careful what you put inside it.

Using a heavy box doesn’t make your shipping cost much more than using a lighter one—but do make sure that you’re actually putting something heavy in there, like books or supplies. Boxes stuffed with air can be just as expensive as regular boxes, so don’t make your costs more than they need to be by going overboard with packing materials.

10) Print your own labels when possible

If you’re shipping items that have little or no packaging (think pens and pencils, books, and such), it might be cost-effective to print your own shipping labels. These are perfect candidates for DIY shipping labels because they have minimal weight and minimal labor costs associated with them. The cost of a label printer is low enough that even if you use it only twice a year, you’ll still come out ahead.

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