Management & Finance

Shipping Charges: Compromises Required

You would think online stores would have found it easier by now to calculate and charge accurate shipping fees, let alone set up uninterrupted checkout processes that flow smoothly. Yet I see more and more questions and requests for customizations and fixes than ever before.

What makes the calculation of accurate rates so complicated? And why do most online stores lose sales because of shipping costs, terms and practices?

In the world of business, we constantly demand (not merely request) more automation and power. Our computers become outdated more quickly than a loaf of bread goes stale. Today’s standard “dos” will be tomorrow’s “procedures we are inclined to rethink,” and like Veruca Salt (the infamous brat at Willy Wonka’s factory), we’ll never have enough. I see the same trends when it comes to outlining and implementing strategies for shipping. The fact is, most small businesses spend more time than they can afford looking for that elusive, completely-automated-yet-inexpensive solution.

It’s difficult for me to tell site owners they need to learn to compromise when it comes to shipping. After all, shipping costs and methods are an integral part of an online store. Without a big budget, however, too many things simply aren’t feasible. Unless you’ve got an enormous disposable budget to spend on the shipping mechanism of the cart, chances are you’ll never charge actual shipping costs — and not a penny more or less — 100 percent of the time.

I’ve yet to find a small-budget shopping cart that can support true dimensional weight packaging calculation based on the weight and dimensions of the actual boxes for every single product. I’d be willing to wager that even the big dogs make and lose money on various orders when it comes to shipping.

If you consistently find major discrepancies, though, chances are it’s your configuration. Many shopping carts offer ways to check package specs against shipping carriers’ gateways and return “accurate” rates — in actuality, estimates — based on the configuration of the plug-in. The majority of miscalculations are the result of improper product weight assignments, or other settings (like box sizes, service selections and carrier account restrictions).

When you test your shipping settings, make sure you compare apples to apples: you should make side-by-side selections for each option at the carrier’s web site, double-checking to confirm each one truly matches what you have configured for your online store.

Gateway servers, however, are not foolproof, and all of them go down from time to time. When this happens, an ideally-developed script will return a message to the customer, stating that shipping cannot be calculated at this time. Ordinarily, the customer is then allowed to place the order with an understanding that he/she will be contacted with the actual ship costs later.

While this imposes unwelcome interruptions on the merchant, you’re better off when you allow this to happen. If you configure the store to simply reject the order, you increase the possibility the customer will leave to shop elsewhere. By using a fallback method of post-order contact, you increase your chances to close sale without further incident.

I’ve heard the objections to allotting time for manual shipping calculation and real-life customer contacts. I’ve seen stores actually turn ordering off when a shipping gateway is down. There comes a time when you have to weigh the pros and the cons. If your order fulfillment process is completely automated — and manipulating orders manually just isn’t possible — then this makes sense. This also means you’ve already invested a great deal of money in the process and losing a few hours’ worth of sales won’t break the bank.

My bet is that’s not you.

My bet is that if you were certain you could make more money by simply taking a few minutes to solidify the shipping calculation and contact the customer, you’d take that step. Why? Because you don’t want to lose anyone to a competitor during that final stage of the checkout process.

Pamela Hazelton

Pamela Hazelton

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