Consolidated Shipping can really be a saver for some merchants especially if they can`t geographically locate inventory globally.
I really agree with you that the time is ending when shipping costs are just passed on to the customer without consideration. Buyers are factoring in shipping costs in their buying decisions and merchants must look at the entire item + purchase (+ International Tax + customs when international) when looking at whether there products are competitively priced.
Just yesterday I price shopped an item online and chose to buy from a merchant with a little higher item price because that merchant had more reasonable shipping and handling prices.
Today merchants are struggling to find ways to bundle shipping in with purchases ("Free Shipping"). Its often easier for merchants with larger ticket items to move the cost of shipping into the product. However, for international shipments, I think (my own opinion) they really need inventory in country to cost effectively offer Free Shipping.
Thanks for the conversation Bert!
Good idea basinet.
We expanded on it at shipwire.com
We put warehouses all over. LA, Chicago, Reno, Vancouver, Toronto, and the a new warehouse in the UK that breaks open Europe.
Our ecommerce fulfillment pricing is online (B2C). B2B wholesale and retail compliance is slightly different.
Business pay on a usage base and we did a free trial
We also plug into most ecommerce software.
w/ ShipwireShipwire7/24/2008 6:50 PM
Couple things.Discounts typically don`t apply to surcharges like residential delivery and fuel.Many carriers move the price increases into the surchargesThe rates are going up and they typically don`t go down. Every year the main carriers jack up the rates and increase the surcharges.Wouldn`t hold out hope of them coming back down. Once they get used to the revenue its hard to give up.
The way fortune 500 companies deal with this is they locate inventory closer to their end buyers. They use multiple warehouses to store inventory and ship from. Example, if you have 70% orders in the US, 10% in Canada and 20% in UK...that is how you should split your inventory. Move some to Canada and the UK.
Because moving inventory in bulk is more efficient. Freight is cheaper than parcel. You cross borders in one shipment rather than individual. That means you clear customs once, your VAT/GST tax base is adjusted and your inventory is now "local" in other countries. Also, once your inventory is spread out your delivery times to buyers will be cut.
We have a calculator that shows how this works in the US and Canada that I can`t paste in here. We don`t have our UK European warehouse added to it yet, but you`ll get the picture.
I wrote a long blog article on the difference between a discount and cutting your shipping costs by acting like a fortune 500 company. It is too long to paste in here. I`ll warn you it is slanted to talk about Shipwire; but, the examples hopefully make sense.
Janie, I`m not sure if this helps you with your product as I`m not sure how "storable" it is; but, it is one way to reduce shipping costs.
We help merchants grow into Canada and Europe.
I put together a page on importing into the UK and how do deal with an outsourced warehouse there (rather than buying, leasing a space and hiring employees).
Lots of import tips, tricks, etc. We have other guides for Canada, VAT, GST, and foreign merchants coming into the US
http://www.shipwire.com for order fulfillment, inventory and growing your business in the U.S., Canada and Europe.
OK enough about us.
There are many shopping carts, order and inventory solutions. you need to decide on whether you want simple (paypal cart), hosted, open source or software you install on a server. Or if you want an all in one solution something like NetSuite (can be expensive). We`ve got a list we work with; but, it can serve as a nice list of places to start. http://www.shipwire.com/help/c/how-it-works/carts/
calendars and such - google aps for your domain is nice
Salesforce.com has lots of modules if your willing to pay a bit - help tix, etc.
Many forum software products are free and you can use them for support case tracking too. phpbb is one option. I`ve seen others.
My recommendation is look at a company that you like to buy from and see how they handle some of these processes.