Did you know that nearly 50% of small businesses struggle with shipping costs? If you’re running a small business, every penny counts—especially when it comes to shipping.
Whether you’re sending products across Canada or worldwide, finding ways to save time and reduce costs can make a big difference to your bottom line. Fast, reliable, and cost-effective shipping is more than just a logistical requirement; it’s an opportunity to improve customer satisfaction and build loyalty.
In this guide, we’ll share the best small business shipping tips that will help you navigate the complexities of shipping, optimize your processes, and boost your profitability. Ready to take control of your shipping costs?
Let’s dive in!
Know the Shipping Needs of Small Businesses
Small businesses in Canada often face unique shipping challenges due to the country’s large size and varying shipping costs across provinces and regions. Some of these challenges include:
- Limited resources: Many small businesses don’t have access to bulk shipping discounts or dedicated logistics teams.
- Rural and remote shipping: Shipping to less accessible areas, such as the North, can be more expensive and slower.
- Customer expectations: Canadians expect fast, affordable, and reliable shipping options.
Understanding your specific shipping needs is the first step toward improving your shipping process. It’s essential to analyze your shipping patterns, customer preferences, and geographic locations to find solutions that suit your business.
Key Shipping Terms Every Small Business Should Know
Understanding key shipping terms is essential for small businesses to optimize their logistics and reduce costs. Familiarity with these terms helps streamline processes, avoid confusion, and improve customer satisfaction. Here are the most important terms every small business owner should be aware of.
The Shipper
The shipper is the individual or business sending the product. If you’re a small business owner, this role typically falls on you. Your responsibilities as the shipper include:
- Packaging products securely.
- Preparing necessary paperwork.
- Ensuring your shipment is ready for pickup or delivery.
The Consignee
The consignee is the recipient of the shipment. Often, this is your customer. For smooth transactions, double-check the shipping and billing addresses, especially for e-commerce orders.
The Carrier
The carrier is responsible for transporting goods from the shipper to the consignee. Major carriers like Canada Post, Purolator, DHL, and others offer various services depending on delivery speed and distance.
Understanding their rates, terms, and policies is key for accurate cost estimates and ensuring timely deliveries. This knowledge helps businesses choose the best carrier, avoid unexpected costs, and improve customer satisfaction.
Third-Party Logistics Providers (3PL)
Small businesses often rely on third-party logistics providers and brokers like GLS, DHL, and Canada Post to save money and streamline the shipping process when delivering products to customers.
Partnering with these services is a smart choice if you don’t have in-house systems for order fulfillment. They can provide assurance that packages will arrive on time, while also handling the complexity of shipments.
Larger businesses may opt for in-house logistics, but this can sometimes be more costly. Third-party platforms have access to exclusive, pre-negotiated rates, which are often unavailable to the public. They may also offer flat-rate shipping or specialized solutions for international deliveries.
Simplify your shipping, save time and money, and eliminate stress—click here to set up your free courier shipping account today.
Understanding Shipping Costs
Shipping costs can vary based on several factors, including weight, size, and delivery speed. Understanding how carriers calculate these costs—such as actual vs. dimensional weight and additional fees like peak surcharges—helps you make informed decisions about packaging and shipping methods.
By planning ahead and optimizing your shipments, you can keep costs under control.
Actual Weight vs. Dimensional and How It Affects Your Billables
When shipping products, small businesses need to undersatand Actual Weight and Dimensional Weight because they both affect how much you pay.
Actual Weight:
This is the physical weight of your product and packaging, measured on a scale. For example, if your item and box weigh 6 lbs, the actual weight is 6 lbs.
Dimensional Weight:
This is based on the size of the package. Even if an item is light, it can take up a lot of space, and carriers may charge for that. The formula is:
Dimensional Weight=Length×Width×HeightDimensional Factor
For example, a box measuring 12″ x 12″ x 12″ might have a dimensional weight of 12.4 lbs, even if the actual item is only 5 lbs.
Billable Weight:
Carriers charge based on whichever weight is higher: the Actual Weight or the Dimensional Weight.
Why It Matters:
- Packaging: Use appropriately sized boxes to avoid paying for extra space.
- Shipping Costs: Compare both actual and dimensional weight before choosing a carrier to find the best rate.
- Savings: Efficient packaging can reduce unnecessary costs.
By understanding these two types of weight, you can better manage your shipping expenses and make smarter packaging choices to save money.
Packaging Tips for Small Businesses
Packaging plays a vital role in shipping success. Proper packaging not only protects your products but also enhances the customer experience. Here are some tips for packaging your products:
- Durability: Use sturdy boxes or padded envelopes that can withstand the rigors of transit, particularly if shipping fragile items. Consider using recycled packaging materials to reduce costs and environmental impact.
- Size: Use the right-sized packaging to avoid excess weight. Overpacking can lead to higher shipping costs, while underpacking can result in damages.
- Branding: Customized packaging can help elevate your brand image and create a memorable unboxing experience. Use branded tape, stickers, or boxes to promote your business.
- Safety: For fragile items, ensure adequate padding (bubble wrap, packing peanuts) to avoid damage during transport.
Packaging doesn’t have to be expensive; however, the right choice can reduce damages and improve customer satisfaction.
How to Calculate The Right Shipping Fees
Calculating the right shipping fees involves considering several factors to ensure accurate pricing and cost efficiency. Here’s a simplified breakdown:
- Package Dimensions and Weight: Shipping costs are typically based on the weight and size of your package. Larger and heavier items generally cost more to ship. Use a scale and measuring tape to get precise measurements.
- Destination: The farther the package has to travel, the higher the shipping cost. International shipments often incur additional fees due to customs and international handling.
- Shipping Method: Choose from options like ground, express, or overnight shipping, each with different costs. Faster shipping typically comes at a premium.
- Insurance: If you need to insure the shipment for loss or damage, this will add to the cost. Review carrier policies to determine whether it’s necessary for your items.
- Additional Services: Some carriers offer add-ons like signature confirmation, tracking, or special handling, which can increase the total cost.
- Carrier Rates: Different carriers (e.g., USPS, UPS, FedEx) have varying rates, even for the same type of shipment. Compare their pricing and services to find the best deal.
By carefully factoring in these elements, you can determine the right shipping fees that balance cost and service quality for your business and customers.
What Is Peak Surcharge?
A Peak Surcharge is an extra fee added by shipping carriers during busy times, like the holiday season, when shipping volumes are high. It helps carriers manage the increased demand and extra costs. This fee is typically added to regular shipping charges and can significantly raise costs for small businesses during peak periods.
Types of Shipping Services Available in Canada
Canada offers a variety of shipping services to suit different needs, from affordable options for non-urgent shipments to expedited services for faster delivery.
Choosing the right service depends on factors like delivery speed, package size, and destination. Whether shipping locally or internationally, businesses can find a solution that balances cost and delivery time.
Courier Services vs. Postal Services
- Courier Services: Faster and more reliable, ideal for urgent deliveries. Examples include Canada Post, UPS, and local courier companies. These services are often more expensive but provide tracking and quick delivery options.
- Postal Services: Affordable for non-urgent shipments. Canada Post offers options like expedited parcel services, which balance cost and delivery speed.
Types of Courier Services
Now that we’ve discussed who is sending the package and common delivery questions, let’s focus on how quickly you can get your product to your customer.
Express Shipping
Express delivery is one of the fastest and most reliable options. For an additional fee, customers can have their shipments delivered within 24-72 hours, significantly faster than regular shipping. Express services are often considered the quickest way to ensure timely delivery. However, they tend to be more expensive, so balancing speed with cost is important.
Same-Day Service
Same-day shipping is straightforward and the fastest option available. Customers can request that their parcel be shipped the same day, with delivery usually occurring by the end of that day, depending on the distance from the shipper’s location.
Overnight Service
Overnight delivery is ideal for those who need their package delivered the very next day. While this service can be costly, it guarantees a fast delivery—typically within one or two days after shipment.
Next-Day Delivery
Next-day delivery generally refers to the next business day, not necessarily within 24 hours. This option ensures that goods are delivered the day after they’re picked up by the courier.
International Shipping
When shipping internationally, it’s important to consider customs and duty taxes. Customs is the agency that collects tariffs on imported goods, while duty is a tax charged based on the value of your shipment upon entry into the destination country (for example, the U.S. charges an import tariff).
Some carriers offer international shipping, but not all provide comprehensive solutions. Be sure to check for any applicable taxes or fees before shipping across borders.
Leveraging Technology for Streamlined Shipping
Small businesses can greatly benefit from using shipping platforms like ShipSimple, which streamline and enhance the entire shipping process. These platforms provide several key features that help reduce complexity and save both time and money, including:
Comparing Carrier Rates
ShipSimple allows you to easily compare shipping rates from different carriers, such as Canada Post, UPS, Purolator, and others. By having access to multiple shipping options, you can select the most cost-effective carrier based on factors like delivery speed, destination, and package size, ensuring that you get the best value for your shipments.
Printing Shipping Labels
With ShipSimple, printing shipping labels becomes effortless. The platform integrates directly with your eCommerce store, automatically generating and printing the correct shipping labels for each order. This eliminates the need for manual entry, reduces errors, and speeds up your fulfillment process, making it easier to get orders out the door quickly.
Tracking Shipments
ShipSimple provides real-time tracking for all shipments, so you can monitor the status of packages as they move through the delivery process. Not only does this keep you informed about any delays or issues, but it also enables you to proactively update your customers with tracking information, improving the overall customer experience and reducing the number of inquiries you receive about order status.
Access to Bulk Discounts
One of the significant advantages of using a platform like ShipSimple is access to bulk shipping discounts. By consolidating your shipments and shipping frequently through the platform, you can unlock discounted rates that are typically reserved for larger businesses or those with high shipping volumes. This can help you save a significant amount on shipping costs, particularly as your business grows and you ship more frequently.
By using shipping platforms like ShipSimple, small businesses can manage their shipping process more efficiently, reduce costs, and focus on growing their business.
International Shipping Considerations
If you’re expanding your business internationally, it’s essential to understand the complexities of international shipping:
- Customs and duties: Ensure you know the customs regulations and taxes for the countries you’re shipping to. These can affect delivery times and costs.
- Shipping partners: Use reliable shipping carriers, like Canada Post, UPS, or DHL, to ensure smooth international deliveries.
- Documentation: International shipments require accurate documentation, such as invoices and customs declarations. Always double-check to avoid delays.
International shipping can be costly, but with the right strategies, it can open up new revenue streams for your business.
Common Shipping Mistakes to Avoid
To ensure smooth shipping, here are some common mistakes small businesses should avoid:
- Incorrect packaging: Using the wrong packaging can lead to damaged goods and higher costs.
- Miscalculating shipping costs: Failing to accurately calculate shipping costs can result in unexpected fees and profit loss.
- Delayed shipping: Late shipments can lead to customer frustration. Always stick to your promised delivery times.
- Poor tracking information: Failing to provide accurate tracking details can lead to customer confusion and dissatisfaction.
By avoiding these mistakes, you can improve your shipping process and enhance your business’s reputation.
Closing Lines
Small business shipping doesn’t have to be overwhelming or costly. By understanding the basics, leveraging cost-saving tools, and strategically planning your shipping, you can save money and enhance your customer’s experience.
Ready to take your shipping game to the next level? Start optimizing your process today and watch your business thrive!
FAQs on Small Business Shipping
What Is the Cheapest Shipping Option for Canadian Small Businesses?
Using an online shipping platform with pre-negotiated rates, like ShipSimple, is often the most cost-effective option.
How Can I Ship Internationally Without Breaking the Bank?
Opt for bulk shipping discounts, use ePacket for lightweight parcels, and ensure your customs documentation is accurate to avoid delays.
Why Is Shipping So Expensive?
Shipping costs depend on package weight, dimensions, and delivery speed. Consolidating shipments and using third-party platforms can help lower costs.
