Nowadays, people think of Amazon as the poster boy of online shopping. The Bank of America concluded that in 2019 alone, it accounted for 44% of all e-commerce sales in the US. This number is expected to skyrocket to 50% by 2020, which only means one thing: Amazon e-commerce will continue to boom as an industry and will be a significant driver to advance modern globalization.
For sellers, the growth of the Amazon brand created an outlier that inevitably affected the businesses they operate on the Marketplace: the perpetual rise in Amazon shipping costs. It has been such a money-maker for Amazon that it racked up $37.9 million on shipping costs alone— imagine the amount of money people spend on shipping every day and the number of products that move from point A to B!
We know it is essential for Amazon businesses to learn how to strategize and calculate their shipping costs ahead of time, but despite this fact, most entrepreneurs still make crucial mistakes at the start. This article talks about three critical factors I wish I had known about the platform’s shipping costs, so you don’t make the same mistakes.
Setting strategic shipping goals are essential.
The first lesson you need to learn as a seller is always to define a clear set of goals ahead of time. Shipping costs are no exception. If you don’t take Amazon shipping into account when you plan to venture into e-commerce, it will most likely drive your profits down.
Shipping goals may vary from seller to seller, but these are the most common factors that people list down when you first start their business:
- Seeing an increase in sales;
- Maximizing conversions;
- Establishing and growing a customer base;
- Limiting long-term costs and
- Improving overall business performance.
Make sure to have these objectives in mind, so you and your future team have a general direction to follow.
Proper packaging is essential.
Proper packaging is vital to ensure your products don’t get damaged in transit. But did you know that it also affects how much your shipping costs will be?
The Amazon shipping process lets sellers choose between its standard box sizes. Failure to select an appropriate package can heighten the risk of product damage, leading to shipping more than one of the same product. Similarly, the wrong product packaging can cause you to choose a larger shipment box and lead to additional Amazon shipping costs.
Ensure that your product packaging is firm enough to hold your goods, but not too tight that protective covers like bubble/mesh wraps won’t fit in.
Registering your business to Amazon’s FBA Program can be beneficial.
Amazon FBA is a unique program introduced on the Amazon Marketplace to help businesses streamline their fulfillment process. The fundamental idea of FBA is that Amazon will store, deliver, and monitor all shipments for goods that you successfully sell.
Amazon FBA shipping charges will cost you money at the start, but its long-term advantages will undoubtedly benefit your business. After all, you can liberate yourself from the headache of shipping and allow Amazon to handle everything. It has warehouse storage, transportation, and monitoring capabilities that focus on other parts of the business. In the process, you are also able to ride the coattails of Amazon’s stellar reputation!
Amazon FBA shipping rates vary for every product that you sell. If you’re interested in registering for the program, Amazon Seller Central is the place for you to start.
The Amazon platform can indeed be a place where any aspiring entrepreneur can make a decent profit, but not everyone can maximize its potential. The right entrepreneurial mindset and a systematic approach are needed when managing Amazon shipping costs. If you want to prevent losing more than just money, these lessons will surely help you get on the right track.
If you’re interested in hiring a team of shipping professionals to provide top-quality assistance, we at Stallion Express can help you with your Amazon shipments. Book an appointment today!