Average Shipping Costs

Average Shipping Costs

Average Shipping Costs

As e-commerce and online shopping is on the rise, consumers aim for shipping services that are fast and affordable. In fact, shipping cost is an important factor that customers look out for when getting a product. But how affordable can shipping fees get without affecting your business? This article will be explaining the factors that affect shipping costs, and how to get a scope on what your shipping fee should be.

Understanding shipping costs

Shipping costs deal with the cost of getting a product from the manufacturer or warehouse to the final destination of a consumer. Many things could contribute to this fee such as surcharges, fuel costs, and other transportation fees. Recently, there has been a rise in the shipping cost. This is a result of the growing use of online shopping. The pandemic has caused many people to resort to e-commerce and that has led to significant demand for shipping services.

Factors affecting shipping costs

Before fully understanding how to calculate shipping costs, it is important to know the factors that drive them. Here are some factors that affect shipping cost:

Weight of the package

An important factor in determining shipping cost is size. Packages that weigh above the norm are likely to attract surcharges. In the calculation for shipping costs, if the weight of the package is greater than the dimensional weight, then the package weight would be calculated instead. Different items fall into different categories in terms of weight. To be sure which yours fall under, ensure to consult your carrier.

Size and dimension

This takes into consideration the density of a package in relation to its original weight. It is a common factor used to determine shipping costs. Carriers often have to choose which weight to bill between dimensional weight and package weight. The one that has more weight is usually billed. So if the dimensional weight is greater than the actual package weight, it will be billed instead.

Shipping distance

The distance from the item’s point of location to the destination of the consumer matters a lot. Whether the item is being delivered locally or internationally plays a huge role in shipping costs. In essence, if an item is being shipped to a farther distance, the shipping cost will be higher. Whereas if it is shipped to a nearer distance, the shipping cost will be lower.

Value of the Shipped Item

If the item being shipped holds great value, you might want to have it insured. This is to protect your interests even if it gets destroyed, lost, or stolen. Although beneficial, insurance costs a lot and could take a good cut in shipping costs.

Taxes

The discourse of finance and business is really hard to engage in without including tax and levies. Shipping internationally may attract taxes that would have to be paid independently. So it is important to factor in taxes when dealing with international shipping.

How to calculate shipping costs

Major carriers like FedEx, and UPS use package dimensions to determine shipping costs. As explained earlier, carriers compare the weight of the original item to the dimensional weight. Whichever is greater is used to determine the shipping cost. Suppose the dimension weight is greater than the actual weight, it is calculated instead. To calculate the dimensional weight, the dimensions of the package are calculated which include; length, width, and height. This is then divided by a dimension divisor. This can be used to round up a good value.

You can calculate the percentage for shipping cost by dividing the cost of shipping by the cost of purchasing the item. You can also use software like ShipStation for shipping in exchange for a small amount of money.

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Overview of Average Shipping Costs

Average Shipping Costs Shopify is a software company that specialises in ecommerce software for small to enterprise level businesses.

Average Shipping Costs Shopify is listed as the best ecommerce software. Shopify was founded in 2006 in Ottawa, Canada and currently has over 6,124 employees registered on Linkedin.

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