The exponential growth of online shopping in the last decade has transformed the retail landscape forever. As eCommerce continues to thrive, market-leading eCommerce shipping platform SmartFreight has urged retailers to invest heavily in this crucial part of the eCommerce experience. A recent Hotjar report found that extra costs like shipping and international import taxes lead 48% of shoppers to abandon their cart, while As many as 22% of users abandon carts because delivery takes too long
As more consumers rely on digital channels to buy products and services, online retailers need to tackle complex shipping challenges to thrive.
“Having a carrier management platform that integrates with carriers globally can reduce the percentage of cart abandonments by giving the customer more delivery options,” says Gavin Warwick, European Partnership Manager of SmartFreight, a platform that unites multiple carriers and allows users to leverage their own freight rates.
Here Matrix and Gavin share some insights and solutions that businesses face in the ever-changing landscape of eCommerce shipping.
If your delivery partner can only process a specific number of orders per minute, this limitation can directly impact your business efficiency. The partner will only pick up and process as many packages as their system allows within that time frame, potentially causing delays and bottlenecks in your order fulfilment process.
To ensure seamless operations, collaborate with a delivery partner whose processing capabilities align with your order volume. They should also have scalability to support your eCommerce growth, so you can avoid delays and maintain customer satisfaction.
Gavin adds: “We all know when the peaks occur, so carriers and shippers have a good idea of what is happening and when with the carriers resourcing accordingly. Big shippers may have a lot of leverage, but carriers plan for their volumes and do want a mix of clients in different sectors at various volume ranges to ensure they build resilience into their own businesses.
As shippers there is choice in the market, both in terms of capability and price point, so it is important and possible to find carrier partners that are suitable to your business and the type of goods being shipped. Further, shippers will often build redundancy into their operation by having a primary and secondary carrier for their needs across various services to ensure they have redundancy.”
Shipping costs are a significant expense for eCommerce businesses, especially if you’re offering free or subsidised shipping, so balancing cost-effectiveness with customer expectations can be challenging.
Companies can reduce this impact through optimisation strategies like bulk label printing, negotiating favourable shipping rates with carriers and implementing a clear shipping cost strategy. Consider dynamic pricing based on factors like order value or shipping destination.
Gavin’s advice: “It’s critical to have a shipping strategy that’s relevant to your customers and appropriate to what you ship. Common errors such as providing free shipping for a low value item by air, or shipping non-urgent goods via a premium carrier can be managed out via appropriate systems. For companies that ship sufficient volume to justify a number of carriers providing a comparable service, such systems will often facilitate least cost routing. This will ensure you will always ship with the carrier offering the lowest rate from the carriers that you are happy to utilise, ensuring you don’t overspend.”
Sometimes it’s difficult to compete with huge multinationals like Amazon, who offer next-day or even same-day delivery — especially if you’re a small business.
Invest in local and regional fulfilment centres to reduce transit times. Implement order management systems that optimise order routing. You could also consider partnerships with local courier services for last-mile delivery.
Remember that clarity and consistency is key — offer a range of shipping options with clear delivery timeframes, and stick to these time frames.
It’s complex trying to maintain accurate inventory levels while seamlessly fulfilling orders. If you don’t get this right it can lead to issues like overselling or delayed shipments, leading to a breakdown in customer trust.
To address these challenges, implement robust inventory management practices. This can include real-time inventory visibility and forecasting algorithms to anticipate stock needs accurately.
Third-party fulfilment services can streamline order processing and reduce operational overhead, so you can improve order accuracy and timeliness without having to worry about software complexities.
SmartFreight expert Gavin adds: “Regardless of whether a shipper is a retailer, eCommerce player, manufacturer, distributor or 3PL, the challenges they face grow and change with scale and complexity. However, almost without exception your shipping platform needs to have delivery partners that cover local and regional needs as well as access to international shipping. Whatever you chose to manage your inventory and fulfilment, this must be integrated to your shipping platform. Nobody wants to waste time transcribing details from one system to another, let alone worry about the increased error rate as a consequence.”
It’s a challenge to balance customer satisfaction with profitability. Businesses must manage returns effectively to build trust with customers while avoiding excessive costs associated with high return rates.
Achieve this balance through transparent return policies with well-documented processes that minimise frustration. Partnering with local locations for return drop-offs is more convenient for customers, reduces shipping costs, and boosts traffic for partners.
Automated returns management software can improve efficiency through data insights — identify the root causes of returns.
On the subject of returns, Gavin says: “Just like a shipping strategy, a returns strategy is a must. Further, visibility of your returns policy for your customers is a prerequisite to avoiding significant cart abandonment. Customers want to know how you facilitate returns and will more often than not take this into consideration when making purchases.
Processing returns is costly, so investing in preventing returns as far as possible will pay dividends in the longer term. Consider and review your online content for product descriptions, technical specifications, colour, sizing etc so your customers are buying with as much empowerment and knowledge as possible.
For the customer, the returns experience is a very different one to the original delivery. Since the customer already has the goods, it’s important to make returns convenient. As a result, your return logistics options will likely differ from your initial delivery methods. Consider drop-off solutions rather than collection, which will be less of an inconvenience to the customer.
Expanding into international markets introduces complexities like customs regulations, duties, taxes, and delivery to remote locations. Counter these challenges by partnering with global shipping carriers experienced in international logistics. Additionally, consider international shipping integrations that automate customs documentation and provide real-time duty and tax calculations.
Inefficient packaging can lead to higher shipping costs and potential damage to products. Customers are also increasingly concerned about the environmental impact of packaging.
Implement optimisation tools that determine the right-sized box or materials for each order. Become more sustainable by exploring sustainable packaging options to reduce environmental impact.
Customers expect real-time tracking and communication as soon as they’ve clicked to buy. Inaccurate or delayed information can lead to frustration and a breakdown of trust.
Integrate a robust tracking and communication system that gives customers real-time updates via email or SMS. And don’t just wait till they contact you — be proactive with updates on branded tracking notifications, to boost the customer experience and reduce support enquiries.
Gavin adds: “You’ll need to provide end customers with access to frequently updated tracking information, this cuts down on contact to your customer service team, but enhances your brand, as it appears that you sit across the shipping journey, rather than off loading this to a delivery partner.”
ECommerce shipping is a complex puzzle, but it can be solved through a blend of intuitive business strategies and modern software solutions. SmartFreight’s Gavin says that it’s all about crafting a strategy that seamlessly integrates the efficiency of software solutions with the human touch and wisdom of traditional methods.
By finding the right balance between cutting-edge tools and well-honed practices, e-commerce businesses can overcome shipping challenges and also enhance the overall customer experience. In this dynamic landscape, adaptability will foster sustained growth and lasting customer satisfaction.
Signing off with some crucial advice, Gavin says: “With many moving parts and variables to consider, choosing the correct partner relevant to your business is critical in building the appropriate infrastructure to enable your business to flourish as the digital world continues to mature. Choosing a partner with relevant industry insights and experience will allow you to be guided through the online journey and avoid the most common pitfalls.”
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