How Much Should You Charge Your Customers For Shipping?

Shipping is a necessary component of doing business. Unfortunately, for businesses, shipping can be a heavy cost that eats away at their profits. While many companies choose to handle this expense by having their customers pay for it, this isn’t the best solution as many will ditch their order if the shipping cost is too high. 

To successfully handle shipping, it’s important to know how to charge customers. For a small business, free shipping can bring in sales. However, if not done currently, it can end up losing the business money. 

That’s when working with a logistics management company can be of tremendous benefit. The right shipping company can save you time, money, and major headaches. 

If you’re wondering how to charge customers for shipping, then the following are the most common methods for shipping on time and under budget.


Free Shipping

Free shipping is the Holy Grail for customers. Because it can get to be a heavy cost if you aren’t careful, small businesses need to know how to properly implement it, including: 

  • Offer free shipping over a certain order amount. Pick a price point for your products that is around 15% higher than your average cart and you’ll see increased sales!
  • Work closely with a shipping agency to find the most cost-effective options available to you. If you tend to ship lighter packages, you should be able to find an option that won’t eat at your profits.
  • Raise your prices to cover the additional cost. Just be careful not to price yourself so high that your customers pick a competitor!
  • Work with a logistics management company that can handle the hassle for you. They can help find a way to make free shipping feasible for your small business.

Flat Rate Shipping

If your packages all tend to be the same size and weight, you may be able to attract more customers with flat rate shipping. Letting them know the cost upfront can help ensure you complete a sale. Don’t forget that you can also offer expedited shipping for customers who are willing to pay to receive their shipments faster.

You can also use a flat rate service, such as those offered by USPS.

If you’re worried about factors like distance charges, you should consider a shipping company that can handle pricing it out for you.

Real-Time Shipping Prices

If you ship large, heavy, or oddly shaped packages, it can be a challenge to price shipping upfront. Offering a real-time shipping calculator can help to show customers exactly what they’ll be paying in total. 

Knowing both times and prices for your shipping can also help reduce your supply chain lead time. After all, a sudden jump in price caused by shipping costs will likely result in your customer taking their business elsewhere. 

A logistics management company can make this option a breeze!

Let Lean Cargo Transportation Take Care of Your Shipping

You don’t need to let the management of shipping take you away from running the rest of your business. Trust the experts at Lean Cargo Transportation, LLC. We can handle all of your shipping needs while bringing down your costs to help you improve your profits. Whether you need to get the best materials to your location or want to ship out products, we’re here to help you save big. Don’t wait, let our shipping company help your business grow.