Expedited Shipping 101: Why offer expedited shipping and how to do it without killing your margins

Reem ElS aadi
Reem El Saadi Nov 22, 2021 • 6 min read
Next day delivery services

It’s no secret that the pandemic has accelerated online shopping trends, drawing more and more consumers away from brick and mortar stores and dramatically shifting buyer behaviour. But one advantage many shoppers have had to trade off was going home with their purchase in hand. Luckily for consumers, businesses are starting to pay attention to what they want— and that is for online orders to be shipped and delivered to their door as soon as possible.

This has quickly evolved from a want to an expectation. With over 200 million members, Amazon Prime has redefined the online shopping experience, leading consumers to seek out 2-day or next-day delivery wherever they shop. With expedited shipping becoming the norm, instant gratification is becoming an expectation, but it’s still largely unmet. That’s why more eCommerce brands are looking to offer faster delivery speeds like next-day delivery to meet customer demand and stand out. And you should too.

What is expedited shipping?

Simply put, expedited shipping is a shipping service that promises faster shipping than standard delivery speeds. Depending on the carrier, this option can have different names, such as “priority mail,” “express shipping,” or “next-day delivery.” Whatever you call it, domestic expedited shipping generally takes between 1-3 days. Logistically, this is made possible because trucks that carry expedited shipments travel straight from order pick-up to delivery without stops in between. The actual time it takes for a package to arrive varies by carrier, origin, and destination, sometimes depending on the shipping zones an expedited package needs to cross to reach the point of delivery.

Because carriers have to take extra measures to speed up the delivery process and meet customers’ demands, expedited shipping costs are almost always higher than those of standard shipping services. And while not all customers are willing to pay more for faster delivery, many are willing to pay the premium if they don’t want to wait for their shipments to arrive.

Why offer expedited shipping

Overnight Shipping

Even if shoppers end up opting for standard delivery, they greatly appreciate having multiple shipping options when choosing an online store or purchasing a product. Here are a few reasons why you should offer expedited shipping options on your eCommerce store.

1. Reduce cart abandonment 

There are multiple reasons why shoppers might abandon their carts, and you shouldn’t let unsatisfactory delivery options be one of them. While the majority cite high costs as the primary reason they leave a website without completing a purchase, some customers simply need their items to be delivered within a timeframe not available to them on your online store. That’s why you should make sure there are a variety of shipping options available at checkout, including affordable expedited delivery. Doing so can reduce shopping cart abandonment and increase conversions for your web store.

2. Meet customer expectations around transit times

Considering that customers sometimes base purchasing decisions on convenience of delivery options, and knowing that they expect fast, affordable shipping wherever they shop, it’s important to offer an expedited shipping option that they can count on. This lets you stand out and allows you to compete with big-box retail and eCommerce giants like Amazon. Missing this opportunity puts your conversion rates at risk, so if you’re hesitant, ask yourself if it’s really worth it to ignore this growing demand.

3. Build customer loyalty

Did you know that 48% of all eCommerce transactions are from repeat customers? It makes sense that when customers are satisfied with their online shopping experience and receive their purchase quickly, they’re more likely to return to your store. On the other hand, 50% of loyal customers switch to a competitor who is able to better satisfy their needs— and that includes delivery expectations. You already understand the importance of offering great products and customer service; make your delivery options equally attractive by including expedited shipping and you’re more likely to win loyal customers who will not only make more future purchases but also recommend your business to others.

How to affordably offer expedited shipping

Expedited Shipping Services

Expedited shipping can eat into your margins, but it doesn’t have to. Here are some ways to keep it affordable.

1. Charge the customer

The simplest solution is to pass the bill on to your customers. By making expedited shipping optional, you let your customers decide if it’s worth it to pay the premium and pass on the carrier charges at checkout. If you’re sending heavy packages, this may be the best option, especially if they’ll be travelling a considerable distance.

2. Require a minimum spend threshold

The appeal of free shipping is undeniable, and this is even more true of free expedited shipping. For many consumers, free shipping is the deciding factor when making an online purchase. In fact, 86% of shoppers abandon their shopping cart due to shipping costs, and 93% claim that free shipping incentivizes them to add items to their carts. If you intend to offer free expedited delivery, covering the costs can have a huge pay-off for your eCommerce business. 

But you need to be strategic about your free shipping play. One way is to require a minimum spend threshold so that the amount of money a customer spends to qualify for free expedited shipping works out to be greater than the average order value.

Set minimum order value thresholds for customers to qualify so you can recover shipping costs and increase profits within the same purchase. To facilitate this, consider bundling some products to help customers meet the minimum cart value they need to qualify for free expedited shipping. A survey by HubSpot revealed that 24% of online shoppers would spend more money in order to qualify for free shipping, so why not aid them with a bundle? This strategy not only simplifies their purchase decision-making, but also gets more of your stock moving while increasing overall sales.

3. Limit the expedited delivery range

Another way to minimize your costs is to limit your offering to customers in nearby shipping zones. By making free expedited delivery only available to customers within specific geographical areas, you limit the cost of expediting a package.

4. Limit expedited shipping to lightweight packages

Rather than focusing on geographical zones, you can limit free expedited shipping to your most lightweight products. Doing so controls carrier surcharges and keeps your costs from getting too high. If you choose to go down this route, create a list of products that your customer can order together and have them shipped for free.

5. Shop around

As with any shipping service, it’s important to compare rates from different carriers. It’s easy to do this when you sign up with a 3PL. Shipping companies like eShipper can negotiate costs with multiple carriers thanks to the volume discounts available to them, passing these savings to you. The eShipper platform lets you compare and choose from competitive rates across all tier 1 carriers, allowing you to ship domestically or internationally at the fairest available market rates while leveraging a menu of innovative shipping services and solutions. 

But you should compare more than just rates. When choosing your expedited shipping service, you should explore the different options available to you from different carriers. You’ll find that some services are similar in terms of speed, cost, and package dimension restrictions, but there might still be some differences in package tracking, insurance coverage, and additional options that can enhance your customer’s delivery experience

6. Consider using a flat rate box

If this option is available, a flat rate box can save you some money on an expedited package. This option is offered by some carriers, and it makes managing costs simpler and easier. The only catch is that the products you ship need to fit in these boxes. 

One way to take advantage of this option is to create a special bundle consisting of products you can fit neatly in a flat rate box. It’s one way to give your customers a good deal while generating sales for your business, so you can maximize your profits and make the most out of what you’ve spent on expedited shipping.

7. Partner with a 3PL

Whatever your product category, and no matter what eCommerce platform you use, you can benefit from outsourcing fulfillment to a shipping company. A third-party logistics (3PL) partner can support your business by allowing you to outsource warehousing, inventory management, packaging, picking and packing, eCommerce fulfillment, and shipping, while also providing essential logistics services such as transportation and freight forwarding. 

Partnering with a reputable and experienced fulfillment centre can make a real difference to your shipping speed and shipping costs. Not only will you be working with fulfillment experts, but you’ll also have access to competitive expedited shipping rates that only 3PLs can negotiate with carriers. You will then be able to pass these savings to your customers or add them to your profits.

8. Ship from multiple fulfillment centres

Rather than work exclusively out of a single distribution centre, distribute your inventory to ship from multiple fulfillment centres. This is an important consideration due to how shipping zones work; if your fulfillment centre isn’t close to your customers, delivery will take longer and will be more expensive. 

But when you work with multiple fulfillment centres, you can ship your products from the location nearest to your customers, reducing the distance a package has to travel and making shipping faster and less expensive.

Remember that the more people you offer expedited shipping to, the more you can reduce instances of cart abandonment.

Next-day delivery: eShipper x FleetOptics

Next Day Delivery Services

If you’re considering overnight shipping in Canada, a great option is FleetOptics. eShipper has partnered with FleetOptics to offer Canadian businesses the opportunity to stand out from the competition with fast, reliable next-day delivery, supported by advanced GPS tracking technology and a focused end-user experience. 

It has become very clear that delivery standards are rapidly changing, and businesses are aware that next-day delivery is increasingly becoming an expectation among consumers. FleetOptics’ overnight shipping, which is available within predefined coverage areas in the GTA, Vancouver, Montreal, Calgary, and Edmonton, ensures that you can meet this demand at an affordable price.

Here are a few features and benefits of this next-day delivery service:

1. Full visibility

eShipper x FleetOptics next-day delivery provides end customers with full visibility of their package’s journey, with detailed tracking and real-time updates for a seamless delivery experience.

2. Reliability and security

Expedited Shipping

Drivers have the ability to contact customers for delivery instructions, ensuring unparalleled reliability and a next-day delivery success rate over 99%. If customers are not available to receive their package in person, there’s a Safe Drop option where a GPS-tagged photo is made available as proof of delivery. This takes the liability off your business if a package goes missing after being delivered.

3. Timely next-day delivery

With an expansive fleet and dedicated drivers, this service operates outside of the regular, congested carrier networks, which mitigates the chance your package will get stuck at major carrier hubs. This can only mean one thing: a delightfully surprised customer, happy to receive their delivery the very next day.

4. Affordability

eShipper x FleetOptics next-day delivery is cost-effective, with flat rate shipping up to 10 lbs per package and a low incremental rate after 10 lbs. That’s a great value courier option— just make sure your package doesn’t exceed 50lbs as heavier packages are not eligible for the service.

Here’s how it works:

Packages are picked up by eShipper or dropped off at the eShipper warehouse by 5PM. eShipper then drops off packages at the FleetOptics facility on the same day, where they’re sorted overnight, and next-day delivery is scheduled along electronically designed routes. For the final mile, FleetOptics drivers deliver packages on the next day, typically by 5 PM, or 9 PM at the latest.

The bottom line

Ultimately, customers want the products they order online to reach them quickly and without breaking the bank. This is the new normal, and sellers need to meet these expectations if they want to survive long term. While next-day delivery can be expensive, there are cost-effective options, and offering them to your customers can have tangible benefits for your business. The reality is that it’s easy to lose customers if you don’t stay relevant, and giving an expedited delivery option— especially overnight shipping— at checkout helps you exceed customers’ expectations and gain their loyalty in the long run. It also helps convert more last-minute shoppers and prevents abandoned shopping carts. 

Contact us to learn how we can help you give your customer a great next-day delivery experience that will keep them coming back for more, at a price that you and they can afford.

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