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How to Cut Down on Shipping Costs: E-Commerce Shipping Solutions for SMEs

E-commerce · 3 Mins Read

How to Cut Down on Shipping Costs: E-Commerce Shipping Solutions for SMEs

The pandemic might have impacted many businesses across the world, but e-commerce continues its meteoric rise. Online retail sales jumped from 16% to 19% throughout 2020, bringing the global e-commerce sales figures to a whopping $26.7 trillion.

The number of small and medium enterprises (SMEs) in Singapore turning to online sales is growing. Now more than ever, platforms like Shopify and WooCommerce are leveraged to sell anything from clothes and jewellery to dog food.

While online retailing offers a myriad of opportunities, the cost of shipping remains one of the biggest expenses small businesses face. So, what are some ways SMEs and online businesses can cut down on shipping costs and boost profit margins?

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1. Choose a trusted shipping partner 

You don’t have to be an industry giant to get discounted shipping rates. While higher shipment volumes typically get discounts, even a small business can benefit by comparing prices for various e-commerce delivery solutions and negotiating lower rates. 

Make sure to request for a selection of quotes from numerous e-commerce shipping companies to compare prices. It is always best to research providers thoroughly so as to assess whether they offer the best value for your money. 

Use each carrier’s quote as a bargaining chip in negotiating for more favourable rates. Also, you can share your sales projections if you expect demand to increase in the coming months due to seasonality or growth. 

2. Consider using an integrated e-commerce platform 

Over 60% of Singapore’s online retailers are on the Shopify platform, with the rest using numerous other sites like WooCommerce. If you are running an online store using Shopify, you might just be able to access hassle-free international shipping and shipping discounts within the platform using the DHL Express Commerce integration directly. 

DHL partnered with Shopify to enable Singapore-based online retailers to easily ship their products worldwide through a simple, seamless plugin on their shipping app. By leveraging this function, you can access flexible express shipping services to 220 countries and territories at negotiated rates. With this partnership, DHL’s plugin will make it even easier and cost-effective for Singapore retailers to ship their products internationally. 

3. Include shipping costs upfront 

While still trying to stay competitive, offering free shipping might not be financially feasible. Stating the product’s shipping cost upfront will manage your customer’s expectations and ensure transparency in delivery charges. 

4. Pre-pay shipping costs

More often than not, pre-paying ahead of time can get you discounts on shipping costs. Even if it's a small percentage, it can lead to significant savings for small businesses in the long run. Simply purchase shipping labels upfront and use them on packages only when you’re ready to ship.

This tactic works best when you ship products consistently with the same weight and dimensions, or have this information before purchasing the labels. 

5. Package your products appropriately 

If you intend to purchase and print labels by yourself, invest in a postage scale to give you a better idea of the package weight, allowing you to get a more accurate cost. 

Most carriers charge based on either the volumetric (dimensional) weight or actual weight whichever is greater. So reducing any unnecessary volume of the package can help save on excessive shipping costs. Small items can be packaged in more compact boxes or lightweight poly mailers. If you don't have boxes or are unable to find suitable materials, fret not as DHL Express provides a range of external packaging supplies to meet your needs.    

Unsure what’s the best way to package your products? Check out our handy shipment packing guides for clothes, shoes, cosmetics, and fragile items ,to get started. or speak to our specialist today.

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