What's the cheapest way to ship a package?
The saying “there’s no such thing as a free lunch” is certainly true when it comes to eCommerce shipping. Consumers expect delivery of their orders to be fast and free, but merchants still have to pay for it somehow—often taking a hit to the bottom line in the process.
Trimming eCommerce logistics costs is one way to align shipping expectations with reality. And while you’ll need to take the time to do the research, the good news is that there are plenty of ways to ship a package cheaply. With patience, ingenuity, and a granular approach to matching the right services to the right shipments, you can eke out savings on shipping that make an impact, without alienating customers in the process.
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The shipping challenge: cost vs. speed
From your customer’s perspective, the faster an order can be delivered, the better. Research from Wix partner Shippo found that the preferred delivery speed for the majority of consumers (62%) is three days or less.
That’s a tight timeframe for most retailers, especially because consumers aren’t willing to pay a premium for it. When asked to name the three most important factors influencing online purchases, an equal percentage of consumers (42%) picked shipping speed and shipping cost, according to a survey from Santa Clara University’s Retail Management Institute. The study found that more than a quarter of consumers have abandoned an online shopping cart because the free shipping option wasn’t fast enough and the cost of expedited delivery was too high.
To satisfy these demands without destroying margins, you need a savvy pricing strategy, combined with shipping flexibility. Juggling multiple eCommerce fulfillment services adds complexity to your operation, but gives you more options for delivering packages cheaply.
Shipping speed options
Major and regional carriers have flexibility in mind like never before. After the supply chain challenges and seasonal spikes of recent years, carriers are working hard to optimize their services with artificial intelligence, new warehouses, and more. A range of eCommerce shipping options are now available for retailers of all sizes, with a focus on speed and efficiency. While comparisons aren’t exact from carrier to carrier, the major categories of shipping speed include:
Media mail (two to 10 days) - The U.S. Postal Service offers a special rate for shipping books, videos, and other materials that meet specific media criteria. While inexpensive, media mail tends to travel slowly via ground transport, and tracking service isn’t available.
Ground or standard shipping (two to eight days) - Multiple carriers offer an option for delivery via trucks and trains. While these surface methods are slower than air freight for long-haul delivery, their speed may be competitive at shorter distances. They’re also more cost-effective. Tracking is available for these shipments, though the delivery date may change depending on road conditions.
Expedited or priority shipping (two to three days) - Expedited services rely on a combination of air and ground transport to move goods faster than standard service. Services such as tracking and insurance are often included (at least up to a certain amount). Within this speed tier, the USPS, UPS, and FedEx all offer flat-rate options using standardized packaging; these options are worth exploring, as they make your costs predictable while providing relatively rapid delivery.
Next-day or overnight shipping (one day) - Under this option, orders that are placed before a certain cut-off time will arrive at their destination overnight via express air and ground transport. This tier of service is more costly than other carrier options, but it guarantees delivery by a certain time, plus offers up-to-the-minute tracking.
Same-day delivery (zero delay) - While same-day delivery was once the exclusive domain of urban restaurants and specialized courier services, it is now widely available by most major carriers. These carriers offer reliable but expensive options. Alternatively, you could partner with personal delivery services (such as Instacart and DoorDash) that may also offer same-day delivery but at a better rate.
Reading the fine print: other factors affecting shipping cost
While delivery speed is the top factor affecting cost and the one that matters most to your customers, there are additional considerations to take into account. Depending on your unique needs as a small business owner, you may need to forecast additional fees for these situations:
Large items - The definitions for “oversize” and “overweight” vary among the major carriers, but they’ll all assess hefty fees for exceeding their maximums. Research specialty carriers and consider freight shipping if you offer especially bulky or heavy products.
Signature requirements/restricted items - Major carriers will almost always require a signature for shipments of restricted products like medicines and alcohol. Expensive goods, such as jewelry or electronics, may also trigger a signature requirement. Even if the carriers don’t insist, if you sell costly items, you may opt to require a signature as a means of preventing package theft.
Perishable goods - If you’re selling items with ingredients that are subject to melting or spoilage—such as foodstuffs, flowers, or beauty products—you may need to pay extra for expedited or climate-controlled shipments to ensure orders arrive in good condition.
Overall volume - Shipping costs typically drop as volume grows, so be sure to compare rates as your needs change.
Seasonal demand - If your sales peak during periods of heavy demand for major carriers, expect to pay additional shipping fees. The fall announcement of year-end holiday surcharges has now become an annual ritual; in 2022, extra fees ran as high as $6.50 per package, according to Shippo, so the costs can add up.
The cheapest way to ship packages in the U.S.
While all three major carriers advertise “flat rate” services, USPS Priority Mail is the only one that offers a single price-per-package size nationwide for a single delivery option of between one and three days. It’s also less expensive than UPS Simple Rate and FedEx’s One Rate, which offer a matrix of delivery speed options. FedEx rates also vary according to region. Both FedEx and USPS require use of their free standardized packaging, while UPS customers use their own packaging, with shipment price tier assigned by volume.
For larger items, heed weight and size restrictions that can limit your service options. For example, USPS doesn’t offer flat-rate boxes above 1,000 cubic inches in volume; additionally, USPS shipments of any type can’t exceed 70 pounds. UPS and FedEx have weight limits of 50 pounds for their flat-rate services, and the maximum volume tops out at 1,738 cubic inches for UPS and 2,200 cubic inches for FedEx. For large and heavy items that don’t qualify for flat-rate service, carriers assign costs based on dimensions and weight. In the U.S., the USPS can accommodate items of up to 70 pounds measuring up to 130 inches in combined length and girth. UPS and FedEx have a maximum weight of 150 pounds and a combined length and girth of 165 inches for domestic packages.
Small package - U.S. delivery
Winner: USPS Priority Flat Rate, up to $10.20, one-to-three-day delivery vs. FedEx One Rate, $12.40-$16.95, three-day delivery; UPS Simple Rate, $17.80, three-day delivery
For purposes of this comparison, a “small” package is one that can be shipped in a flat or padded envelope, poly mailer, or small box (100 cubic inches or less). Single books or apparel items, jewelry, and small electronics are likely to fit in this category.
Medium package - U.S. delivery
Winners: FedEx One Rate for <150 miles, $16.95, three-day delivery; USPS Priority Flat Rate for 151+ miles, $17.10, one-to-three-day delivery vs. UPS Simple Rate, $29.75, 3-day delivery
For purposes of this comparison, a “medium” package is a box with a volume of between 250 and 650 cubic inches. Shoes, multiple apparel items, and small home goods are likely to fit in this category.
Large package - U.S. delivery
Winners: FedEx One Rate for up to 600 miles, $39.10-$44.20, three-day delivery; UPS Simple Rate for 601+ miles, $51.35, three-day delivery vs. USPS Priority Mail, $89.35, one-to-three-day delivery
For purposes of this comparison, a “large” package is a box with a volume of between 1,500 and 2,200 cubic inches. Small appliances, home decor items, sports equipment, and multiple pairs of shoes are likely to fit in this category.
The cheapest way to ship packages internationally
If you ship internationally, the challenge grows steeper to find the most economical service. Not only do the size and weight of the package factor into pricing, but so does the destination country. DHL, which offers U.S. domestic service for businesses only to high-volume enterprise companies, is another option to consider for global shipments in addition to the “big three.”
As examples, consider these two comparisons both shipping a 16”x11”x3” package with a weight of five pounds.
California, USA to Ontario, Canada
Winner: UPS Standard, $34.74, seven days vs. FedEx International Ground, $35.17, seven days; USPS Priority Mail Express International, $78.50, five-to-seven days (no slower option listed); DHL, $126.74, five days (no slower option listed)
California, USA to Dublin, Ireland
Winner: USPS Priority Mail Express International, $92.45, five-to-seven days vs. DHL, $194.39, two days (no slower option listed); FedEx International Economy, $244.03, seven days; UPS Worldwide Expedited, $304.23, seven days
Tips for trimming package shipping costs
Even with a variety of potential sources to choose from for shipping services, the immediate future looks expensive for eCommerce package delivery. Trucking labor shortages, cargo delays, and fuel surcharges are all contributing to pricing pressure, making it harder than ever to solve the challenge of how to offer free shipping while remaining profitable.
To uncover more alternatives, think outside the box. Reach out to other partners and industry groups for guidance, and examine every aspect of your eCommerce warehousing and fulfillment operation for potential processes to streamline. Among the possibilities:
Think outside the (“big three”) box - Regional and specialty carriers might be viable options depending on your needs. As an added bonus, having multiple ways to route packages can be helpful during peak seasons. Major carriers have been known to cap the number of shipments they’ll accept during these busy seasons in an attempt to protect on-time delivery performance.
Check for discounts through partners - Reputable vendors and marketing partners may have more clout to negotiate favorable rates with carriers than you could achieve on your own. If you use a third-party logistics (3PL) provider or other fulfillment solution, those companies are obvious places to start – but marketplace providers that offer shipping support may be a resource as well. For example, Wix partner ShipStation offers savings of up to 84% on carrier fees to merchants selling through its platform.
Optimize eCommerce product packaging - Keep an eye out for new containers or packing materials that could reduce the weight or dimensions of your shipments. In addition, review best practices with staff to ensure that items are being packaged economically and with adequate protection to prevent damage or breakage.
Make the most of your stores - Your brick-and-mortar locations are powerful tools for lowering the costs of speedy delivery and optimizing your inventory management. Not only do they offer a place for shoppers to pick up items within hours of purchasing online, but they can also double-up as fulfillment centers. In other words, you could use store inventory to fulfill orders for home delivery and take advantage of cheaper shipping charges for local trips. You could even partner with delivery services such as Instacart and DoorDash to get items quickly to customers, or deploy your own staff on delivery runs.
Be slow and collected - Entice customers to wait until all the items they purchased are ready to ship together, or to opt for “no-rush shipping.” These “green” options offer two main benefits: fewer and slower shipments are less expensive, and they also reduce carbon emissions from vehicle miles traveled. Giving carriers more time gives them leeway to manage truck space better, eliminating waste. Pass on the savings to help nudge customers to do the right thing.
Research your way to cheap shipping
When sky-high customer expectations for free and fast eCommerce delivery meet the reality of rising shipping costs and complex logistics, your profit margin could be at risk. But by researching your options in depth and adopting a diversified, flexible approach, you can locate opportunities to save at every service level, without compromising the customer experience.
Allison is the editor-in-chief at Wix, with several years of experience reporting on eCommerce news, strategies, and founder stories.