What are shipping and handling? We've all seen that little line item on our orders at some point, but what is it exactly? And, more importantly, why do we have to pay for it? In this post, we'll break down what shipping and handling are, why they cost money, and how you can keep those costs as low as possible. Ready to learn more? Let's get started!
Picking, packaging, and delivering purchased commodities to the final client are all part of shipping and handling. It's also the expense for the labor, storage, and shipping charges associated with completing client orders.
While many individuals consider shipping and handling similar, others may be unsure what the handling aspect entails.
The expense of transporting ordered things to clients is referred to as shipping. The costs and surcharges for carrying the packages, such as mail, fuel, mode of delivery, and delivery timetable, are included in these prices.
On the other side, handling costs include:
- Receiving purchased items.
- Putting them in shipping containers.
- Appropriately labeling them.
- Placing them into a delivery vehicle.
In simple words, this refers to the many interactions that the ordered products have while still in the warehouse. The order fulfillment procedure would not be complete without handling. Personalization, kitting, and gift wrapping are examples of value-added services included in handling fees.
Let's look at a few of the variables to consider while estimating shipping expenses and how they affect your entire order fulfillment strategy.
The distance from the transportation zone
Customers who live close to your warehouses will pay lesser delivery prices than those that live further away. Cutoff times, transportation costs, and conversions will all be affected by the modes of delivery you provide clients. Some customers will require speedier delivery of a few items than others.
Still, it's worth experimenting with your options – from essential ground services to two days delivery to express shipping, you could be surprised about what connects with your client base. Of course, as the number of zones or distances between them grows, quicker delivery options become more costly. Only purchases mailed to nearby locations can be sent in two days if you deliver from one place. Goods shipping to remote areas will need to be shipped by air to ensure 2-day delivery.
Learn more: USPS Shipping Cost
Smaller businesses may find shipping to be too expensive
You may compare freight prices from multiple carriers to locate one that matches your needs and save money on shipment. Depending on how far the item is transported, shipping firms charge different delivery charges. As a result, shipping prices for two products dispatched from separate warehouses to the exact location will almost certainly differ. The rationale for this is simple: the closest shipping zone to the storehouse will have cheaper shipping costs.
The pricing of your goods
This is another issue that will affect your delivery expenses. High-end, pricey products generate more money, allowing you to enjoy free delivery alternatives that incorporate the cost of transportation in the product cost.
When you obtain a fulfillment estimate, the transportation company's assets for handling charges cover the functions within a fulfillment center. In addition to basic labor expenses, indirect expenditures include shelving units, parcel racks, trolleys, conveyors, inventory control systems, fees, utilities, office equipment, bonuses, workers' compensation, insurance, permits, and packaging materials, labels, scanners, and more.
As your company expands, so will your shipping and handling operation. As a result, the work and expenses involved with your shipping and handling charge strategy, in the beginning, will be considerably different than how it is controlled when your eCommerce business processes more shipping items regularly. That's why most eCommerce companies use the help of a 3rd party to manage the details of your specific shipping choices.
1. You have fallen behind on client orders.
2. You have reached the limit of storage capacity.
3. Managing orders during high seasons is challenging for you.
4. Instead of executing corporate operations, your management team spends most of its time dealing with inventory difficulties.
5. You'd want to provide your consumers with more economical or faster delivery options, but you do not have the way to do so.
6. You wish to move to a new area or target a different market.
Shipping and handling can be a tricky thing. There are so many factors that go into it, like the weight of your package or how far you're shipping internationally. That's why we created our Simpl eCommerce Logistics service to help take some of the stress out of figuring out all these logistics on your own! Our team works with companies across industries to make sure they have an optimized fulfillment solution for their online orders. Contact us today if you want more information about this comprehensive solution for simplifying your order fulfillment.
Recommended: What's the Difference Between Warehousing and Storage
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