E-Commerce Seller Financing • July 22, 2020
The cost of shipping can be a huge challenge in the world of e-commerce. Steep shipping fees are the fastest way to turn off potential customers and lose sales, even after items are in the basket. To maximize sales, you should consider occasionally offering free shipping. Here’s how you can go about taking this important step.
1. Evaluate Your Internal Expenses
Even though free shipping is bound to attract customers, you can’t offer it without determining how it might impact your bottom line. You must evaluate your internal costs. Know exactly how much you’re paying for shipping. You might want to look into other options for domestic and international shipping and see if there’s any way you can bring down the expense of e-commerce shipping.
You’ll also have to take your profit margins into account. It might be worth raising the price of your products slightly if it means you can offer free e-commerce shipping to customers.
2. Find the Free Shipping Strategy That’s Right for You
There are several different ways you can make shipping free for your customers. Offering free shipping on every order might sound nice, but it’s not practical for most businesses, especially when you’re still in the growth phase. These are a few of the most common ways to offer free shipping to your customers:
- Offer free shipping on a certain dollar amount—This is probably the most popular way to offer free shipping. Customers get free shipping once their cart totals a certain amount, such as $35 or more. Customers will be more likely to add an item to their shopping cart if it means their order will qualify for free shipping.
- Give new customers free shipping on their first order—This is a great way to make not only a sale, but a new customer and build brand loyalty early. All you have to do is create a coupon code for users who create new accounts.
- Ship orders for free for a limited time—Offering free shipping is equivalent to a sale in e-commerce. When people see you’re waiving shipping fees on all orders for a set time frame, they will be more likely to quickly make a purchase while the offer is still good.
- Create a membership program—A lot of e-commerce businesses are creating membership programs for loyal customers. For a monthly fee, members can get special offers like discounts, freebies, and, most importantly, free shipping! This is also a great way to have consistent revenue coming in month to month in the sometimes-unpredictable world of e-commerce.
3. Learn What Your Competition is Offering
It’s important to know what you’re up against in the shipping department. If you’re always making your customers pay full price for shipping, you’re probably going to lose sales to your competitors. Instead of letting that happen, we encourage you to find a shipping strategy that works to attract more customers.
Apply for a Business Loan the Easy Way
Offering your customers free shipping is one important decision you can make for the good of your business. Another important choice you may have to make is how to go about obtaining business financing. E-Commerce Seller Financing is the easiest way to raise capital for your business. We’re here to help you apply and get approved as quickly as possible!