How small businesses can cut down on shipping costs

Despite the widespread disruption to global businesses, the pandemic has given rise to new opportunities in the e-commerce sphere. With more people staying at home out of necessity or safety, it’s no surprise that online shopping has boomed as businesses increasingly went digital. 

Let the numbers do the talking — according to Statista, the global value of e-commerce sales hit US$4.2 trillion in 2020, with revenues projected to reach US$5.4 trillion in 2022. In Hong Kong, as reported by the SCMP, e-commerce sales are expected to rise from US$22.9 billion in 2021 to US$29.4 billion in 2024. A growing number of small and medium enterprises (SMEs) in Hong Kong have embraced digitalisation and online retailing platforms, with more than half reporting an increase in online sales. 

As more retailers enter the playing field, the flourishing e-commerce industry is becoming more saturated than ever. Amidst a myriad of challenges, shipping costs remain one of the biggest expenses for SMEs. How can small businesses save money on shipping to raise profit margins and stay competitive? 

1. Opt for a trusted shipping partner

Choosing a reliable shipping partner can go a long way in reducing shipping costs for small businesses. Experienced logistics providers like DHL Express often have comprehensive yet flexible shipping solutions tailored to individual business needs. 

While it is generally easier to get discounted shipping rates with larger shipment volumes, small businesses can benefit by comparing prices from numerous e-commerce shipping providers. By using each carrier’s quote as a bargaining chip, you will have more leverage to negotiate for cheaper shipping rates. You can also consider sharing your sales projections with carriers to get the best shipping rates, especially if you are expecting higher sales due to seasonality or growth.

2. Get preferred shipping rates 

If you’ve settled on one particular shipping partner, you might be able to save money on frequent shipping. For instance, opening a DHL Express account can get you various benefits, including preferential rates on international shipping and billing options. 

3. Weigh packages and pack them appropriately

Optimal packaging is essential for small businesses to save money on shipping. If you are planning to print shipping labels by yourself, it’s best to invest in a postage scale. Larger and heavier packages lead to higher shipping charges. Hence, if you’re not paying for flat-rate shipping, knowing the accurate package weight can help to reduce shipping costs significantly. 

Another tactic to save on shipping is to reduce package dimensions by using boxes that fit the size of products as closely as possible. Doing so reduces the overall volumetric weight of your parcels, which lowers shipment costs. Consider packing small items into more compact boxes or lightweight poly mailers. Even if that means stocking up on a range of packaging materials, it can make a long-term difference in cutting business costs. 

An added benefit of proper packaging is the assurance that shipments will reach your customers safe and sound — saving you the potential expense of refunds and compensation for damaged goods. 

Not sure what is the best way to pack your products? Check out our shipping advice, with detailed guidance on choosing suitable materials, packing techniques, helpful packing guides and more. Sign up for a DHL Express account today to start shipping.