Small and medium-sized eCommerce businesses have a lower barrier to entry than ever due to free or cheap access to online and mobile commerce platforms. However, e-retailers such as Amazon still dominate the market share of online sales, making it hard for smaller companies to stand out. One of the areas where large companies have the advantage is shipping: 79.8% of shoppers say they use Amazon because of fast, free shipping, per a survey from early 2020. Amazon has pushed aggressively for free shipping, and other eCommerce companies need to match free or low-cost 2-day, next-day, or same-day shipping in order to compete. Learning how to provide fast and low-cost shipping is the key to increasing online sales.
Amazon’s Shipping Capabilities
Amazon set the bar for 2-day shipping with its Prime service. While Amazon sells both directly and through marketplace sellers, either can support 2-day shipping using Amazon’s logistics and their fulfillment centers spread out geographically and focused on major metropolitan areas. Even if free shipping is not covered by the cost of a Prime subscription, this can be offset by high volume of sales from Amazon and long-term customer loyalty.
Due to the high variety of carriers, regional capabilities, and different marketplace sellers on Amazon, not all items provide fast or free shipping. This means that for any given item there is still a chance to provide comparable or better shipping times and prices. Smaller eCommerce businesses shouldn’t give up hope of competing.
How Can Small Businesses Improve Their Shipping
There are several areas where smaller businesses can reduce costs and improve speed of shipping. These include:
- Improve fulfillment
The process of fulfilling orders once received can lead to delays in shipping. Fulfilling orders as quickly as possible places the responsibility of quick delivery in the hands of the carrier. For in-house fulfillment, get materials and shipping labels ready for immediate packing and delivering to the shipping carrier. Placing high-demand products in a fulfillment center can dramatically increase the speed of shipping, though you will need to pay warehousing costs. Companies that handle fulfillment have superior logistics and can pack and ship products at an extremely fast rate.
- Focus on a few doable shipping options
Offering many different shipping options may require engaging multiple carriers, stocking different materials, and more preparation needed. Reducing the number of express and standard delivery options improves your efficiency at fulfilling them.
- Look for discounts for bulk shipping
There are several ways that higher-volume shipping can lower costs. Delivering packages to the carrier in larger groups reduces the amount of shipping or labor used to send them. Getting prepaid shipping for high-demand packages can reduce the costs from shipping companies.
- Improved planning and training
Better training and organization can improve the speed of any task that you and your workforce need to complete for shipping. Create a detailed plan for fulfilling each different shipping option and organize when items need to be transferred to carriers in an orderly fashion. Have employees committed to completing orders in a timely and organized manner
Use Shipping to Build Loyal Customers
Your shipping doesn’t necessarily need to be better than Amazon in every way; as long as it’s competitive in speed, cost, and convenience. Many eCommerce stores offer free shipping as a tool to encourage loyal customers in special circumstances. 74% of retailers reported offering free shipping for purchases exceeding a minimum amount, 32% offer it on holidays, and 21% provide it for their best customers, according to Statista research. Deploying superior shipping options in the right circumstances can get customers to try your store and then keep coming back.
In addition to giving customers fast and free shipping, great customer service related to shipping can improve customer satisfaction. Providing tracking information quickly, being responsive to questions and concerns, addressing both positive and negative feedback, and offering a customer-friendly returns policy that doesn’t cost them extra will lead to more satisfied and loyal customers.
Shipping can be done cost-effectively, giving customers a strong motivation to choose to support a small or medium-sized business over a massive company like Amazon.