http://images.internetretailer.com/IR/IRCE-2011_E-Commerce-Tech-Theater-Details.html#agilone?cid=IRT
Check out the last video from UPS for Shipping Information.
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For Online Retailers looking to outsource order fulfillment.
Sunday, August 28, 2011
Wednesday, June 22, 2011
Strategies for Online Retailers to Deal with Free Shipping
There are a number of good strategies to deal with the free shipping war going on right now in the online retail space. The bad news is there is no FedEx "Free" option that companies like Amazon know about, while you are stuck shipping FedEx Ground. The key is to manage your shipping costs while also packaging those costs in the right way to your customers so they can see the holistic value of your products and not make purchasing decisions based on just on the perception that the shipping is free.
- Free Shipping for a minimum purchase or on certain products: A key to being able to offer low cost or free shipping is to have enough margin built into your product to cover those costs. Knowing your margins and shipping costs can help you develop the right model to know the points in which your margins can support covering shipping costs.
- Flat Rate Shipping Options: For many online retailers, the shipping costs for their customer orders will be very different order to order. This is the result of weight, size, and destination being different depending on the product mix. With some analysis from your order fulfillment operation you can determine your average shipping costs and charge based on the average. Displaying shipping costs earlier in the check out process reduces cart abandonment and a flat rate shipping cost can make this easier.
- Shipping Clubs and Optional Upgrades: Many online retailers offer a service that for a one time fee you can receive free or upgraded service - see Amazon Prime or Shoprunner. Or consider on top of a flat rate price, the option to upgrade from Ground to Second Day Air for a small up charge.
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Twitter: @kennethkowal
- Free Shipping for a minimum purchase or on certain products: A key to being able to offer low cost or free shipping is to have enough margin built into your product to cover those costs. Knowing your margins and shipping costs can help you develop the right model to know the points in which your margins can support covering shipping costs.
- Flat Rate Shipping Options: For many online retailers, the shipping costs for their customer orders will be very different order to order. This is the result of weight, size, and destination being different depending on the product mix. With some analysis from your order fulfillment operation you can determine your average shipping costs and charge based on the average. Displaying shipping costs earlier in the check out process reduces cart abandonment and a flat rate shipping cost can make this easier.
- Shipping Clubs and Optional Upgrades: Many online retailers offer a service that for a one time fee you can receive free or upgraded service - see Amazon Prime or Shoprunner. Or consider on top of a flat rate price, the option to upgrade from Ground to Second Day Air for a small up charge.
______________________________
Twitter: @kennethkowal
Wednesday, May 25, 2011
Good Articles on Returns at an Order Fulfillment Warehouse
http://www.practicalecommerce.com/articles/2793-Using-the-Return-Policy-to-Convert-Shoppers-into-Customers
Also, here is a link to another post that talks about how a 3rd party order fulfillment operation handles returns.
http://fillship.com/blog/2011/05/17/how-are-returns-handled-at-an-order-fulfillment-warehouse/
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What to talk about order fulfillment for your company? Click Here!
Also, here is a link to another post that talks about how a 3rd party order fulfillment operation handles returns.
http://fillship.com/blog/2011/05/17/how-are-returns-handled-at-an-order-fulfillment-warehouse/
_______________________________
What to talk about order fulfillment for your company? Click Here!
Saturday, May 21, 2011
Friday, May 20, 2011
How Do Online Retailers Offer "Free Shipping?"
A question we get a lot from clients is "How can so many online retailers offer free shipping?", which is then followed up with "What can we do to compete with free shipping offers?"
There are a couple of reasons online retailers are able to offer free or cheap shipping, unfortunately the reality is that there are no free shipping service options with Fed Ex or UPS or the Post Office or anyone else. So whether you are a large shipper, ecommerce startup, or growing online retailer there is no such thing as free shipping.
What large companies do get, that startups and small companies typically do not, are substantial discounts on small package company's published rates. In addition, if a company is shipping a very large amount of the same size packages there is often the chance to get preferential rates in those circumstances.
Clearly if you are a startup or small online retailer you are at a significant disadvantage because you are without the leverage to negotiate better rates with FedEx or UPS. But in the end, just like your business, the big online retailers are covering the cost of shipping with the margins in their products.
What to do about it as a startup or small online retailer? Obviously it is paramount to figure out ways to minimize shipping expenses because these are costs that are not going away no matter how big you get.
Consider alternatives to FedEx or UPS by looking at the options offered by the USPS. Many companies find that Flat Rate Priority Mail boxes are a good way to reduce costs. FedEx and UPS charge hefty residential, extended delivery area and fuel surcharges that hurt the economics of shipping Business to Consumer (B2C) with them.
More distance equals more cost so your shipping location is directly correlated to your shipping costs. Most of the people in the US are located in the mid-atlantic and northeast part of the country. If you are shipping from San Francisco to customers in New York, the cost could be double or more than the cost to ship to New York from a location in Pennsylvania. Another advantage the big guys have is the ability (as in volume) to ship from multiple points within the US. They can service most of the country with cheaper ZONE 2 or 3 shipments, as opposed to expensive ZONE 8 shipments going coast to coast by having multiple warehouse locations to ship from. Similar story, but it does take volume to make it worthwhile to set up multiple shipping points around the country.
Many 3rd party order fulfillment warehouses will pass on their volume discounts with FedEx and UPS, so look into a partnership to outsource your product shipping. Your operation will potentially benefit from the collective volume of all the customers shipping from that fulfillment center.
_____________
Freight Services for Online Retailers
Order Fulfillment for Ecommerce Etail
Logistics Software for Online Retail
There are a couple of reasons online retailers are able to offer free or cheap shipping, unfortunately the reality is that there are no free shipping service options with Fed Ex or UPS or the Post Office or anyone else. So whether you are a large shipper, ecommerce startup, or growing online retailer there is no such thing as free shipping.
What large companies do get, that startups and small companies typically do not, are substantial discounts on small package company's published rates. In addition, if a company is shipping a very large amount of the same size packages there is often the chance to get preferential rates in those circumstances.
Clearly if you are a startup or small online retailer you are at a significant disadvantage because you are without the leverage to negotiate better rates with FedEx or UPS. But in the end, just like your business, the big online retailers are covering the cost of shipping with the margins in their products.
What to do about it as a startup or small online retailer? Obviously it is paramount to figure out ways to minimize shipping expenses because these are costs that are not going away no matter how big you get.
Consider alternatives to FedEx or UPS by looking at the options offered by the USPS. Many companies find that Flat Rate Priority Mail boxes are a good way to reduce costs. FedEx and UPS charge hefty residential, extended delivery area and fuel surcharges that hurt the economics of shipping Business to Consumer (B2C) with them.
More distance equals more cost so your shipping location is directly correlated to your shipping costs. Most of the people in the US are located in the mid-atlantic and northeast part of the country. If you are shipping from San Francisco to customers in New York, the cost could be double or more than the cost to ship to New York from a location in Pennsylvania. Another advantage the big guys have is the ability (as in volume) to ship from multiple points within the US. They can service most of the country with cheaper ZONE 2 or 3 shipments, as opposed to expensive ZONE 8 shipments going coast to coast by having multiple warehouse locations to ship from. Similar story, but it does take volume to make it worthwhile to set up multiple shipping points around the country.
Many 3rd party order fulfillment warehouses will pass on their volume discounts with FedEx and UPS, so look into a partnership to outsource your product shipping. Your operation will potentially benefit from the collective volume of all the customers shipping from that fulfillment center.
_____________
Freight Services for Online Retailers
Order Fulfillment for Ecommerce Etail
Logistics Software for Online Retail
Friday, May 13, 2011
Want free industry advice from "experts" on shipping and fulfillment?
Two websites you may want to check out if you have questions on shipping and fulfillment are Quora and Focus. Both give you the chance to post questions and get answers from industry "experts" that will hopefully be helpful. Here is a link to an example of a question from Quora.
http://www.quora.com/Whats-the-cheapest-shipping-method-for-businesses-shipping-high-volumes-of-small-boxes-within-the-U-S-where-the-box-weighs-more-than-13-ounces?__snids__=18166978#ans388442
Or, feel free to contact me at kenneth.kowal@yahoo.com to talk about order fulfillment and logistics. Visit kennethkowal.com.
http://www.quora.com/Whats-the-cheapest-shipping-method-for-businesses-shipping-high-volumes-of-small-boxes-within-the-U-S-where-the-box-weighs-more-than-13-ounces?__snids__=18166978#ans388442
Or, feel free to contact me at kenneth.kowal@yahoo.com to talk about order fulfillment and logistics. Visit kennethkowal.com.
Wednesday, May 11, 2011
New Resource to Help Online Retailers with Order Fulfillment and Shipping Questions
Have, or looking to start, an online retail store? Check out www.shipstarter.com - they will offer some free advice to help you navigate the complicated process of getting your customer orders packed and shipped.
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