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The Shipwire Blog/Creating Value with Ecommerce Shipping: Part 1

Creating Value with Ecommerce Shipping: Part 1

You’ve heard the old adage before: You have to spend money to make money.

While some dispute it, in the world of ecommerce shipping, it’s a hard point to contest. Unless all of your customers are local, you have to pay to get their orders to them. So the issue isn’t really eliminating the cost of shipping; instead, the challenge is in optimizing the value of ecommerce shipping.

In other words, since you have to pay for shipping in some way, shape, or form, you should aim to maximize what you get out of it.

In this five-part series, we’ll explore a number of ways you can create value for your business as you ship. We’ve also combined the entire series into a handy guide, which you can download for free.
 
Gaining customers through strategic ecommerce shipping
To gain a significant number of new customers in one move, one tactic is to move – literally.

This sounds more daunting than it actually is. You see, not everything needs to move, and in fact, you can stay right where you are. It’s just your products that need to move.

Why? Because when your products are closer to your customers, shipping is faster and less expensive.

Faster shipping from more locations at a lower cost? That sounds like a recipe for gaining new customers.

By strategically placing your products in many locations, you may also benefit from a competitive advantage. Many companies assume they simply can’t reach far-flung buyers in a cost-effective manner, a mentality that causes them to cap their customer bases below what is truly possible. Setting yourself apart from others by offering service levels that they can’t achieve allows you to capture their would-be customers.

Now that we’ve outlined how staging products in new, high-volume markets enables customer growth, let’s talk about tactics for getting products to these locations.

There are a couple of different approaches to consider. One is to leverage a network of global warehouses from which you can store and ship products.

While you could theoretically contract individual warehouses in each of your desired locations, it’s significantly easier to use a network that’s connected so all warehouses operate in a similar fashion. The goal, after all, is to streamline your processes and make them more efficient – not to introduce headaches that come from navigating a web of warehouse processes. Look for a provider that boasts both scale and quality- control processes so that your goods will be stored safely and shipped securely. The best providers should be able to supply you with powerful analytics systems that give you insight into inventory management and can adapt as your business grows.

Once you select your warehouse provider, another key is to bulk-ship products to the overseas facilities so that you only pay customs fees once. Bulk shipping also allows you to send goods cheaply across the longest distance, thereby freeing up capital for the most expensive part of the shipping process: the parcel delivery service to the customer. From there, you can have pallets broken down and individual products can ship without international fees attached.

Additionally, your provider should be able to pinpoint the best and most cost-effective carrier, supply a variety of service levels, and offer packaging – all at the click of a button. By taking this approach, you can trim expenses and minimize the time you spend fulfilling packages and ensuring their arrival on your customers’ doorsteps.

In the next part of the series, we’ll talk about ways to earn more money from customers and how this is related to shipping.

Comments

  • Ava Cristi 11/27/14
    Shipping is definitely a challenging aspect to any e-commerce business. Every business will have their own unique challenges they will need to work through and overcome to develop the best and most efficient shipping strategy. Like many aspect of building your new business though, it will take time and tweaking to determine what works best.

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