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What Things to Consider on Calculating Shipping Cost?

What Things to Consider on Calculating Shipping Cost?

With an ever-growing trend of E-commerce, shipping products has become one of the most popular activities. Platforms like shows that it is now a norm with a number of shipping companies operating in the market.

Nevertheless, there are some concerns prevalent in this area. One of them is the charge for shipping with your online store. Shipping rates are widely in question these days. Online sellers often ask the question that how they should calculate the shipping costs. Since it can play a major role in online sales, it is essential to answer this question.

It totally depends on variety of factors. Here are the most common shipping solutions:

  • Do not charge at all. Keep it free.
  • Flat shipping rate is a single rate for all the orders.
  • The shipping price may be based on total price of items are being bought.
  • The shipping price may vary according to weight of the products.
  • The shipping rate is calculated in real time with specific shipping carriers.

However, there here are some factors you may consider to calculate shipping costs and ensure you don’t lose money and at the same time offer better services to your customers.


The first thing is your line of products. Whether you sell cheap, expensive, heavy or lightweight items will determine the value of shipping cost. Answer to such questions will enable you to calculate the shipping cost more effectively. If your average margin order is low then free shipping would not be a recommendable option. So it totally depends on the nature of product you are selling.


It also depends on the location of your customers. Are they situated locally or internationally? Ask yourself relevant questions. Their buying habits must also be taken into account. It will help you determine the shipping price.


You have to consider the ongoing competition as well. If you are in a hyper-competitive industry then you have to make sure the shipping charges are nominal or you provide free shipping since customers head towards such options. If you are selling items that virtually have no competition then you can impose charges accordingly. The competition of your niche is a vital factor.

Here were three important factors that would determine your shipping charges. It is very important to keep in mind that shipping charges can be instrumental to business’ success. This is why e-retailers have placed immense emphasis on this aspect.

You can manipulate your strategies according to the flow of business. Some businesses offer free shipping for their best and frequent customers. Some may offer free shipping on certain items. Some may calculate according to the nature and price of order. Everything boils down to making profits. Have a long-term approach and calculate shipping charges according to your business objectives. You need to have a business mindset in this area.

Now you know the importance of shipping charges and what factors you must take into account to calculate them. Given its significance, do not overlook this aspect.


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