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How to cope with skyrocketing shipping cost

With the final Black Friday stocking period, sea freight prices are still soaring. Today, sea freight prices have exceeded US$30, up more than 50% compared to US$20 before the outbreak, and there is still no stopping the trend, making stocking up even a “luxury” for small and medium-sized sellers.

So, what can sellers do to help themselves in the face of persistent shipping cost spikes on the eve of peak season?

Methods to cope with shipping cost spikes

I. A variety of shipping methods to work together to avoid stock-outs where possible

Many sellers’ first reaction to the spike in shipping costs is to wait and see, and with today’s rising sales and shipping delays, the wait-and-see attitude is likely to lead to out-of-stock items. According to big data, nearly 10 million items are currently out of stock on Amazon. Out-of-stocks are costly for sellers: not only are they vulnerable to followers taking over prime shopping carts, but prolonged out-of-stocks can also lead to a drop in shop rankings, especially during Black Friday and other promotional periods when sales and reviews are multiplying.

As a result, sellers need to avoid long-term stock-outs where possible. Considering the disadvantages of the current sea freight-only model, sellers can give due consideration to other shipping methods. For more profitable items, sellers can consider airfreight to ship some items while watching the sea shipping price, prioritizing to ensure they retain their prime shopping cart and ranking.

II. Optimising packaging solutions to save shipping costs

It is well known that shipping costs are primarily based on weight and size, and the heavier and larger the package, the higher the shipping costs to be paid. For sellers, the size and weight of the item itself are fixed and difficult to change, but the packaging solution is something that can be optimized.

There are three suggestions on how to optimize packaging.  

1. Carefully measure the size of the product. Many online shoppers do not know much about the size and weight of their products, and if they are not clear about the size of their products, then the probability of over-packaging will be great. Therefore, each seller needs to carefully measure the size and weight of their products, which is a prerequisite for optimizing their packaging solutions.

2. Set aside enough packing boxes. If there are not enough boxes of the right size, sellers will often use larger boxes with more padding to replace them. Many uncertainties exist, and there is no guarantee that the production and supply of packages will not be delayed, so it is recommended that sellers prepare enough boxes in advance to avoid problems.

3. Avoid odd-shaped packaging methods. Oddly shaped packaging tends to take up more container stacking space and is therefore charged more. Therefore, it is best for sellers to choose the correct cubic packaging box for the size of the product. Packaging optimization solutions are relatively simple, but they need to be elaborate enough to be worthwhile for sellers to do a careful optimization now that shipping costs are at an all-time high.

III. Commodity price increases: small price hikes, side by side

Raising prices is the most straightforward solution in response to rising costs, but when you raise prices, your competitor doesn’t necessarily rise. It is important to understand that although many sellers are already facing out-of-stock situations, the inventory figures of many top sellers have not changed much compared to last year. Even if many sellers are already out of stock, the existing stock of these top sellers is sufficient to support them. With the prices of the top sellers remaining stable, it is clear that it is not a wise move for small and medium-sized sellers to increase their prices rashly.

But then again, small and medium-sized sellers also want to survive. The cost of profits continues to be compressed under the premise that it is really difficult to survive without price increases. Therefore, on balance, it is recommended a slight price increase while looking at the rise. If sales fall quickly after the price increase, then adjust back to the original price. If the response is stable, then you can consider continuing to increase slightly.

Best Shipping Solutions from eComhub.net

Last, eComhub can always provide the best shipping solutions to minimize your shipping costs and ensure fast shipping.

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