Secrets to Cheaper Subscription Box Shipping

Virginia Miller

July 21, 2024

In this article

Shipping is the physical transport of goods from one point to another and is one of the most critical procedures of any subscription business. After all, shipping is part of the fulfillment process — the process that gets your goods into your customers’ hands. Without proper shipping procedures or good shipment facilities, your subscription box company (and everything else eCommerce!) would be null and void.

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Considering how vital this aspect of fulfillment truly is, it’s important not to skimp on it. At the same time, however, fast, reliable shipping can be expensive. How are you supposed to reduce the price while still giving customers a great experience? Well, we’ve got a few tricks of the trade to share.

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Ways to Reduce Subscription Box Shipping Costs

Use Cubic Weight Shipping

Cubic weight shipping, also known as dimensional weight, is an effective way to reduce costs for subscription box shipments. With this method, both the size and weight of the package are used to calculate shipping rates. This benefits smaller, heavier packages that would be more expensive to ship based on weight alone. To qualify, most shipments need to weigh under 20 pounds and take up less than .5 cubic feet of space.

The cubic weight is calculated using this formula: Length x Width x Height / 1728 = Cubic Feet. Fulfillment centers can negotiate discounted cubic rates with major carriers, passing the savings along to their customers. This can help reduce overall shipping expenses for subscription box companies.

Use UPS SurePost or FedEx SmartPost

UPS SurePost and FedEx SmartPost leverage both UPS/FedEx and the USPS to provide economical shipping. Packages are picked up by UPS/FedEx and taken to a destination post office for last-mile delivery by a mail carrier. This helps reduce costs compared to having UPS/FedEx handle the entire shipment.

Because the USPS handles part of the delivery, these services can save on expenses related to distance traveled. They also avoid residential surcharges levied by UPS/FedEx. Overall, SmartPost and SurePost offer reliable, cost-effective shipping for subscription box businesses.

Work With a Fulfillment Center for Discounts

Partnering with a fulfillment center is another way subscription box companies can reduce shipping expenses. Fulfillment centers buy packaging materials, labels, and other supplies at wholesale costs and pass those savings to their clients. They also negotiate discounted shipping rates with major carriers based on high volumes.

Additionally, fulfillment centers handle all aspects of order processing and shipping. This saves subscription box businesses money on labor, materials, and overhead. It also provides access to expertise and best practices gained from shipping large volumes of packages.

Evaluate Carrier Reliability

When selecting a shipping carrier, reliability is just as important as cost. Key factors to evaluate include:

Cost: What are the rates for typical subscription box packages?
Reliability: What are the on-time delivery rates? How safely are packages handled?
Deliverability: Does the carrier offer wide coverage without major address restrictions?
Transparency: Is tracking information clear? Can customers easily monitor shipments?

Finding a carrier that balances affordable pricing with consistent, transparent service enables subscription businesses to meet customer expectations and support growth.

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Next article: How to Ship Subscription Boxes Cheaper

FAQs

What is dimensional weight shipping?

Dimensional weight shipping, also known as cubic weight, calculates rates based on both package size and weight. This saves money on small, heavy subscription box shipments.

How does SmartPost shipping work?

FedEx SmartPost and UPS SurePost hand off packages to the USPS for final delivery. This avoids residential surcharges and reduces costs related to distance traveled.

Why use a fulfillment center?

Fulfillment centers provide wholesale rates on shipping supplies and discounted shipping prices through volume discounts. They also handle processing and shipping to reduce labor and materials costs.

What should you look for in a carrier?

When picking a shipping carrier, evaluate their reliability, coverage area, tracking transparency, and costs for typical subscription box packages.

Can dimensional weighting save me money?

Yes, cubic weight shipping bases rates on package size as well as weight, which can provide major savings on small, heavy packages common with subscriptions.

Is SmartPost slower than regular UPS/FedEx shipping?

SmartPost and SurePost may be 1-2 days slower than normal UPS/FedEx since final delivery is handled by the postal service. However, most packages still arrive within 4-6 business days.

What are the downsides to fulfillment centers?

The main downside is potentially higher monthly costs at lower shipment volumes. However, rates drop as order volumes increase, making fulfillment centers cost-effective for most established subscription companies.

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