Working out delivery rates can be one of the most difficult parts of setting up an online store or ordering system but it’s important.
Postage rates often play a key role in an online shopper’s buying decision, and charging too much for delivery can often see your customer go elsewhere.
There are a variety of ways you can calculate postage, however there may be some restrictions dependent on what type of online ordering you are setting up.
A shopping cart offers the most flexible methods for calculating postage. You can define multiple rates and multiple delivery providers. You can define rates by:
- flat rate per item
- flat rate per order
- rate based on weight of the products ordered (eg. $5.00 per kg)
- you can use a combination of different rates (eg. you could have a flat rate for items up to 10kg and then charge $3 per kg for each kg over 10kg.)
For each postage rate you can define it to a geographical region or weight range. Eg. you may want to offer a $6.95 flat rate shipping up to 3kg – so this option would only appear if the products the customer has ordered weighs less than 3kg.
Note: to base your shipping prices on weight you need to be able to enter the weight of each item in your store
Simpler cart options such as Paypal Cart, the shipping configuration is not as flexible.
Paypal only allows you to enter a flat rate per order, or you can enter the delivery charge as part of your product price which would allow you to have a flat rate charge per item.
Before deciding on your delivery rates you should:
- check to see what your competitors are charging and see if you can at least charge the same or preferably a cheaper price.
- see if you have any margin to include part of your delivery costs in your product price, this will obviously make your advertised delivery rates cheaper.
- check with your local post office, or use the Australia Post’s online postage calculator and accurately work out how much your products will cost to send in varying quantities.
- try courier companies, these may be cheaper in particular for heavier items
- allow for any gift wrapping or packaging in your calculations (for both price & weight)
