E-commerce Bootcamp | Deliver Tips
You can either make money on shipping or you can lose a lot of money on shipping, it comes down to margins at the end of the day, how much you're actually making on your product. Because if you have very low margins, then you want to try and select the most competitive shipping company out there.
You shouldn’t necessarily use only one courier company. The reason for that would be that certain couriers specialise in certain rates and you can benefit from shipping certain parcels with one courier over another. I think returns is a very commonly used word in e-commerce and when it comes to the cost of shipping, you need to consider if your type of product will have a lot of returns. Clothing has a high number of returns while cosmetics will have a lower number of returns. You need to consider if you're going to offer free returns or not. If you are going to offer free returns you need to make sure you've already included that cost in the shipping cost when you charge them initially, or, you've included in the markup of your product.
People seldom think about what happens when something goes wrong. Some stores or some merchants choose to offer free returns but for you as a seller, you need to decide whether that's practical. For example, you've sent the wrong product by accident and these things happen. Make it right with your customers, take the product back, cover the shipping. Everyone loves free shipping, be very well aware that this absolutely eats away at your margins because there is no such thing as free shipping, either the customer is paying for it or you need to cover it. So maybe one strategy would be to offer free shipping over a certain threshold. So you say orders over 500 rand because we know that that's going to give you enough margin to cover the cost of shipping and even some return.
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