When you first dreamed about starting your business, you might have imagined growing your customer base until you were processing orders all day long. You enjoyed the thought of making your products and getting them out to the people who loved them, but then you were faced with the reality of shipping.
Businesses deal with shipping costs every day, but they’re not always easy to plan for. New businessowners easily find themselves with expensive charges they weren’t prepared for when it’s time to ship an order.
Read on to learn about understanding hidden shipping costs so you can prepare your business budget. Once you know what to look out for, paying for shipping will be a breeze.
1. Express Delivery Fees Skyrocket
A customer placed an order and wants your product on their doorstep as soon as possible. You want to give them express delivery options that work with their schedule, but are they suitable for your budget?
Express delivery estimates don’t have to follow the same pricing guidelines. Standard delivery may cost five dollars and get there in 14 days or less. The next step up, express delivery, could cost $12 and arrive in 10 days or less. It depends on who you ship with. Make sure you know the cost for each option before offering shipping methods to your customers.
2. Calculate Packaging Fees
Don’t forget that every order needs packaging supplies. You’ll need to pay for the boxes, tape and supplies like packing peanuts so your orders arrive safely. When a business is just starting, this may not cost much. Expect to pay much more when orders come in more frequently, especially if you aren’t able to order supplies in bulk.
3. Print Your Labels With Care
There’s also the fee for printing your shipping labels. Unless you invest in the right printer for your business, you should compare label printing costs to find the best option. Remember that you’ll need to drive and pick up the labels as well, which ends up costing you gas money if you don’t pay for delivery.
4. Know Your Landing Cost
Every business owner needs to learn about landed cost and what it entails. It’s the price you’ll pay to get your product from your supplier to the customer who ordered it, so it includes many features. There are freight and shipping costs, like packaging fees, as well as exchange rates, storage fees and even risk-related charges. What you pay depends on your supplier, insurance provider and other factors specific to your business.
5. Read Tax and Duty-Related Charges
As your business grows, you’ll need to think about tax and duty-related charges for new international customers. When you pay these charges, you pay upfront when you ship, so you should know what it will cost at the time of shipping. The different fees are listed separately on your receipt so you can use them to predict future charges on other orders.
Do Your Research
Shipping companies and suppliers aren’t in the business to surprise you. Research who you ship with and find out what they charge. You can also call them once you have a specific order in mind as well, so always remember to do your research and ask for help when you need it.