Almost every small business has inventory. And, unless you use a drop shipping company, you probably do that shipping yourself, for a fee. Shipping and handling fees are so ubiquitous now that most people don’t even think about it before agreeing to them. There are, however, benefits to not charging your customers a shipping or handling charge. Here are a few of them.
1. Customer Incentive
How many times have you wanted to buy something but then stopped yourself because that thing was heavy and you knew the shipping fees would wind up being expensive? What if you didn’t have to pay the shipping costs? Wouldn’t you be that much more likely to buy the product? Of course you would! Getting free shipping is often the perfect way to nudge a customer from the “hesitant” column over to the “happy buyer” column. And, because you’ll be selling more products, you’ll make up for the costs involved in sending it out.
2. Fewer Mistakes
Having to keep track of shipping and handling costs and income is time consuming. Offering it for free chops what you have to keep track of in half. Without as many details to keep track of you reduce the likelihood of there being errors in your tracking and in your reporting. It also eliminates the chances of you accidentally overcharging someone for shipping or handling (which happens more often than you probably want to believe it does).
3. Standard Charges
Many businesses believe that it will be difficult to put together a budget that will cover the cost of shipping products to buyers, especially if they offer products that are a variety of sizes and weights. The truth is, though, with some basic inventory control, planning is possible. Having standard sized shipping containers and boxes and knowing what your sales rates are from month to month can help you plan for the money to be set aside to keep everything covered.
4. Better Reviews and Rankings
People are more likely to rate you well when you offer free shipping. This is particularly true if you run your business through a site like eBay or Amazon where buyers are asked by the parent company to rate sellers. Even if your business is completely independent of those portals, your customers will be rating you on sites like Google, Yelp, etc. You can be sure that they are going to mention the lack of shipping cost in the review which will improve your reputation in the eyes of the people who are trying to figure out whether they want to buy from you or one of your competitors.
Even if you aren’t sold on offering free shipping across the board, you don’t have to rule it out completely. For instance, you can offer free shipping to people who pay for monthly or annual memberships with your company. You can raise your prices by a percentage point or two to help cover costs that way (don’t raise them the actual cost of shipping, people will see through that). You can offer free return shipping and discounts on receive shipping. There are lots of ways to test the waters of this particular pool.