Shipping

Australia has many parcel delivery services, including the national postal service, Australia Post.

To choose the right delivery service for you and your customers, consider:

• how easy it is to get a quote from them
• their shipping times
• if they offer express delivery for urgent orders
• whether they can handle your range of parcel sizes and weights
• if they will pick up from your business premises
• their terms and conditions, including if they compensate you for lost or damaged packages
• extra insurance options
• other services they offer, like reporting, logistics management or integration with your ecommerce platform
• whether they can ship overseas (if you are planning to export products).

Treat choosing a delivery provider like any other business supplier – research the options carefully to find the right one for your business.

Decide how you’re going to charge customers for shipping. The most common options are:

• free shipping
• flat rates
• tiered rates
• exact cost.

Free shipping

Offering free shipping on all your products is a simple method that is very attractive to customers.

Free shipping can be a good option if your products are small and all about the same size. That’s because you can accurately predict the cost of shipping.

Free shipping may not work well if your products are larger, heavier and more costly to ship.

Make sure your pricing strategy for a product considers how much it costs you to ship that product. You might need to either:

• include shipping costs in your product prices
• accept less profit per item sold.

Flat-rate shipping

Flat-rate shipping is another simple pricing option. Customers pay a fixed shipping charge per order, no matter what they buy or how much they spend.

This makes it easy for customers to calculate the final cost. It can also be attractive to customers planning a large order because the shipping fee applies to their whole order, not each item.

The flat rate method works well if your products are similar in size and weight. If they're not, you might end up undercharging for shipping on some orders.

Tiered rates

Tiered shipping is a mix of free and flat rate shipping. You charge a flat rate for cheaper orders but offer free shipping for orders over a certain amount.

For example, you charge $10 for shipping on orders of $99 or less. But if a customer spends over $99, their order ships free.

Customers contribute to the delivery costs for smaller orders, but you can promote free delivery on larger, more profitable orders. This may tempt some customers into buying more to reach the free shipping threshold.

You can also offer different shipping rates for different customer needs. For example, a more expensive express option if they need the order quickly.

Exact cost of shipping

Many ecommerce platforms and shipping companies can give you an instant shipping quote based on the size and weight of an order.

That means you can charge customers the exact cost of delivery. They don't pay more than they need to and you won't lose any profits. The downside is that customers usually can’t see the total shipping cost until they check out.

Packaging

Packaging helps keep your customers' orders safe during shipping.

Delivery companies calculate shipping costs based on size and weight, so it’s a good idea to keep your packaging as small and light as possible. But choose quality boxes and packing materials to stop items getting damaged during shipping.

Custom-branded packaging can also be part of marketing your business.

Parcel tracking

Make sure your customers receive a tracking number so they know where their order is and when they should expect it.

Parcel tracking also helps you resolve disputes with your customer or delivery company if a parcel gets delayed or lost.

Shipping insurance

Shipping or delivery insurance covers you if a package gets lost or damaged during delivery.

Before you purchase extra insurance, review your delivery company’s terms and conditions. Check if the company will compensate you for loss or damage, as well as the maximum they’ll pay. Consider taking out extra shipping insurance when you ship items above this limit.

Like any insurance, you should research your options and make sure you know what is and isn’t covered.

Your online store should tell customers what to expect. Make sure your delivery information is easy to find and includes details like:

• shipping costs
• expected delivery times
• how customers can contact you if there’s a problem with their order
• when you’ll refund or replace a customer order (these rules need to align with Australian Consumer Law).

There might be times when you know deliveries will be delayed. For example, during busy online shopping periods. Be upfront about timeframes so customers can decide when to order from you.

If you can’t supply a product the customer has paid for in a reasonable time, you must provide a solution. This may include a refund or replacement.