How To Calculate Shipping Costs Instantly in 2022? 6 Top Factors Affecting the Calculation of Shipping Rates

The eCommerce shipping industry is constantly evolving and changing. As a result, the methods used to calculate shipping costs also change from time to time. It is crucial to be aware of the most recent changes and trends in the shipping industry to budget your shipping needs and calculate shipping/courier rates accordingly.

It’s no secret that the cost of shipping charges can be a significant factor in eCommerce sales. Nearly 60% of shoppers said they would abandon their cart if shipping charges were too high. With that in mind, it’s essential to make sure that you accurately calculate shipping costs to offer competitive rates and avoid losing potential customers.

Information Needed To Calculate Shipping Costs

Know Your Shipping Zones

One of the first things you need to do when it’s time to calculate shipping costs is to determine which shipping zones your products will fall into. Shipping charges are based on these zones and distance from your fulfillment location and also range from local to international.

Knowing which shipping zone your products fall into will help you calculate shipping rates. For example, local shipping is typically less expensive than international shipping.

Use Flat Rate Shipping

If you’re looking for a simple way to calculate shipping rates, consider flat-rate shipping. With this method, courier charges are incurred, regardless of the weight or size of the order.

Flat rate shipping can be a great option to keep your shipping charges simple and easy to understand for customers. Plus, it can help you save money on shipping if you have heavier or larger products.

You Can Also Read: Flat Rate Shipping vs Standard Shipping

Calculate Shipping Costs Based on Weight

Another option to calculate is to base them on the weight of the shipped products. This is a common method used by many eCommerce businesses.

While calculating shipping costs based on weight, you’ll need to determine the average weight of your orders and then find a shipping carrier that offers rates depending on the weight of the shipment. Once you have that information, you can start to calculate your shipping costs.

Make Use of Shipping Software

Shipping software can be a great way to calculate shipping costs. Shipping software typically includes features like real-time shipping/courier charges and shipping label creation.

Using shipping software to calculate shipping rates can help you save time and money on shipping. Plus, it can help you automate some of the more tedious aspects of calculating shipping charges.

Get Shipping Quotes from Multiple Carriers

When you calculate shipping costs, it’s essential to get quotes from multiple carriers. This will help you compare rates and find the best option for your business.

Getting shipping quotes from multiple carriers can be time-consuming, but it’s worth it to make sure you’re getting the best possible deal. You can use shipping software to get quotes from multiple carriers or contact each carrier directly.

Keep these tips in mind to while estimating shipping rates and you’ll be on your way to offering competitive rates that won’t break the bank.

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Factors to Keep in Mind Before Calculating Shipping Costs in 2022

Shipping prices may be tough to calculate since there are so many variables that influence the final cost. But, there are four key pieces of information that you’ll need every time. You should be able to receive an accurate price if you have this information. 

Here are the four factors that may impact your shipping rates every time:

Points of Origin and Destination for Shipping

The distance traveled by a package from its point of origin to its shipping destination is an important element in determining the cost. In general, the greater the price, the more away you are. Shipping zones are used by couriers to properly calculate the distance a cargo travels from its origin to its final destination. There are now eight shipping zones in the United States, divided by zip code.

Although it’s a basic concept, you must first decide the location you are shipping from and the destination to which goods will be delivered before you can begin calculating prices.

Gross Weight of the Package

The deadweight of a package refers to its weight. Put it on a scale and find out how much it weighs. The more expensive it is to send a package, the heavier it is. But there’s also dimensional weight to consider. This becomes more intricate and is determined by the dimensions of the box in which you are shipping the products.

Dimensions of the Package

The length, breadth, and height of the packaging used to ship the products are the dimensions. Because packages arrive in a variety of sizes, it’s critical for eCommerce retailers to understand how this affects the price. Particularly when couriers charge by dimensional (or volumetric) weight as well. In a nutshell, this is the amount of room a product takes up in the delivery truck.

To calculate the dimensional weight, couriers multiply the length, width, and height of your box, then divide the result by a cubic divisor of their choosing.

It’s a good idea to understand more about dimensional weight and how to save shipping expenses by optimizing your packaging. These modest measures will help you save money on shipping and receive a more accurate quotation for eCommerce businesses

Shipping Delivery Times

Delivery time refers to the time it takes for a product or cargo to arrive at its destination. Depending on the distance the cargo is travelling, this can range from overnight to over a month, & prices might vary accordingly.

It will cost substantially more to get a parcel sent overnight than if you go for a typical 3-7 days delivery period. Before you settle on a shipping cost estimate, you’ll need to determine how quickly you want your products delivered.

Value of Products 

If you’re delivering high-value items, you should consider having your shipments insured. Senders who have their packages lost, stolen, or damaged in transit can get reimbursed with shipping insurance. This service, while handy, can dramatically increase your delivery costs.

Top 6 Factors Influencing Your Shipping Costs

Because of the many extra taxes dependent on the destination country, the size and weight of the shipment, and the duration of delivery, international shipping can get complicated.

It’s critical to do thorough research and properly calculate shipping costs so that your consumers aren’t surprised by exorbitant charges, which is one of the leading causes of shopping cart abandonment in eCommerce.

Insurance for Shipments

If you’re shipping costly items, consider obtaining shipping insurance to safeguard against items being lost, stolen, or damaged during transit. The majority of shipments arrive safely, but mistakes can happen, and if you’re delivering high-value items, replacing inventory will cut into your earnings, so it’s important to be insured.

Couriers normally charge a little fee for this service – around 3% of the reported value of your package on average. Another option is to get shipping insurance from a third-party provider, which is usually less expensive. Through the Insurance Settings section of their dashboard, Easyship users can quickly add insurance to their shipments.

Cost of Fuel

When fuel prices, particularly diesel, are greater in a certain location owing to taxes, market pressures, or other geographical variables, shipping charges rise. When fuel prices fall, shipping costs should fall as well. Carriers may raise their charges to protect themselves from abrupt fuel price spikes if fuel costs are variable at the time you’re shipping.

Keep in mind that shipping across states is typically more expensive owing to gasoline prices. Fuel prices in each state vary widely depending on local and state taxes. The cost of fuel in your location may differ from the cost of fuel in the shipment area. Fuel surcharge calculators are used by some truckers to estimate these fees, which are usually added to shipping rates.

Minimum Costs for Carriers

Minimum tariffs apply to all carriers. Regardless of how tiny your package is, if it falls below that level, you will be charged the minimum. Before hiring a shipper or looking into alternative shipping options like FedEx and UPS, you should make sure you have a package that is larger than the bare requirement.

Extra Charges

If your package necessitates lift gates, inside delivery, residential delivery, or other access difficulties for drivers, factor them into your freight shipping prices. Dock-to-dock transportation is a specialty of commercial shipping. If you deviate from that, you will be charged for the inconvenience. Accessorial fees might range from delivery to a strip mall to appointments scheduled in advance. Make sure you’re aware of all of the alternatives ahead of time and that you consider them in the price of each task.

Related Article: Ways to reduce transportation costs

Charges for Handling Dangerous Goods

Due to the contents of the package, packing, weight, and dimensions, you may be charged extra costs.

Chemicals, needles, weapons, and, most significantly, lithium-ion batteries for eCommerce businesses are examples of risky goods that a courier feels are dangerous to handle. The International Air Transport Association (IATA) defines dangerous products worldwide, therefore that’s the best place to look for an official list.

If the parcel exceeds the standard dimension or weight, is constructed of a substance such as wood or metal, or is cylindrical, an extra cost may be charged. It’s a good idea to double-check these costs before buying any boxes or containers.

Taxes and Duties

Before your cargo is delivered to another nation, you or the recipient of your product may be requested to pay extra customs and taxes. Duties and taxes may be charged depending on what you’re shipping and how much it costs. These can be complicated and differ from nation to country. You should be aware of two sorts of responsibilities since they are frequently the source of hidden expenses.

  • DDU Shipments (Delivery Duty Unpaid): The recipient is responsible for paying the duty in order for the package to be released from customs. If the recipient refuses to pay the taxes or refuses to accept the delivery, you, as the sender, are still accountable. This is why, as a trader, it’s ideal to keep your overseas shipping charges as transparent as possible. It helps you save money.
  • DDP Shipments (Delivery Duty Paid): The sender is responsible for paying the levy, however, the computation is more complicated. When the shipment reaches the destination country, couriers will charge a “DDP handling fee” for paying the taxes and customs on your behalf. The proportion of taxes and tariffs is used to compute a “disbursement charge.” Yes, it’s complicated, but at the very least, you’ll know that the box won’t be returned because the receiver doesn’t pay or declines it.
  • When the cargo reaches the target country, the couriers will charge you an extra cost for paying the Taxes & Duties on your behalf. Aside from the predetermined DDP handling charge for managing certain taxes and levies, one can expect a disbursement fee.
  • Under-declaring items on a commercial invoice might result in extra charges and lengthy delivery delays. If the customs clearing agency feels the claimed value is less than the market value, a fresh invoice is frequently requested, which might result in additional costs. There may be additional warehousing fees for keeping the product if it is not received within the desired time range. In addition, if you under-declare the contents of the box, the courier may charge you. As a result, this is an area where you must exercise extreme caution and pay close attention to the smallest of details.

Importance of Calculating/ Estimating Shipping Costs Accurately

There are a lot of businesses out there that don’t take the time to calculate shipping costs accurately. This can lead to many problems down the road, including lost customers and increased expenses. Here are just a few reasons why it’s important to make sure you calculate your shipping costs accurately:

You Could Lose Money on Each Shipment

If you’re not careful, you could easily lose money on each shipment you send out. You could either be charging your customers too much for shipping or not enough. In both cases, you’re leaving money on the table that could be used to improve your business in other ways.

Your Customers Could Get Frustrated

If your customers are constantly overcharged with shipping prices, they could get frustrated. This could lead to them taking their business elsewhere, which is the last thing you would want. Make sure you’re fair with your shipping charges, so your customers will stick around.

You Could Run Into Cash Flow Problems

If you’re not charging enough for shipping, it could eventually lead to cash flow problems. You’ll be spending more money on shipping than bringing in money from customer orders. Make sure you calculate shipping costs accurately so you don’t run into any financial difficulties down the road.

It Could Affect Your Bottom Line

Your shipping charges will have a direct impact on your bottom line. If you’re not careful, you could spend more money on shipping than you’re making in profits. Make sure you’re doing everything you can to keep your shipping charges under control, so your business can be successful.

It Could Hurt Your Reputation

If customers consistently have problems with your shipping charges, it could hurt your reputation. Hence, it’s important to make sure you calculate shipping costs accurately. By providing fair and reasonable shipping charges, you’ll be able to keep your customers happy and maintain a good reputation for your business.

As you can see, there are many reasons why it’s essential to estimate courier charges. If you’re not careful, it could lead to many problems for your business. Make sure you take the time to calculate shipping costs to avoid these potential problems.

How Do Major Shipping US Courier Models Calculate Shipping Costs Instantly?

The three big shipping services have their own cost calculators.

Many of the above elements are taken into account by each delivery provider in order to provide varied shipping price models and shipment methods.

Here are the price models and calculators for three of the most popular shipping companies in the United States: USPS, FedEx, and UPS.

United States Postal Service- Shipping Prices and Calculator 

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The United States Postal Service is frequently the cheapest of the three carriers, particularly for ground shipment. USPS already delivers to your end client every day because they operate local routes every day and don’t have to go out of their way to do so.

USPS consolidated its two business pricing models (commercial plus and commercial base) into one commercial pricing model in January 2019. Shipping reductions of up to 15% off retail shipping and fees are available with commercial pricing. You must apply for this price model through the United States Postal Service.

Check out USPS’s mailing and shipping pricing to figure out how much shipping will cost you.

How to efficiently utilize the USPS Shipping calculator:

  • To use the USPS Shipping calculator, go to the USPS Postage Price Calculator website. You may use this website to estimate shipping costs for both domestic and international shipments. If your company mails are pre-sorted, you can use the USPS Business Price Calculator to calculate your shipping rates.
  • Fill up the details with the specifics of your letter or parcel. Choose your letter or package’s destination from the drop-down menu, then input ZIP codes, the sending date, and the contents of your package.
  • Choose a shipping type. After you’ve input your shipment’s data, you’ll need to determine how you want to get it to its final destination. You can use the USPS Shipping Calculator to select a Flat Rate or a shape, such as a postcard, letter, big envelope, package, or large package. When you select a flat rate option, such as Priority Mail Medium Flat Rate Box, you’ll see the estimated arrival date as well as retail and online postage charges. You’ll be prompted to input the weight of your letter if you pick a form resembling a letter. Select the shape that most closely resembles your letter by pressing “Continue.” Following that, you’ll be provided the estimated delivery date as well as the retail and wholesale prices.
  • Examine your shipping choices. You’ll see the cost details for your chosen shipment type at this moment. By clicking “Display All Alternatives” at the top of the page, you may compare pricing for various shipping options.
  • Additional Services, you may add extra services here, such as a Certificate of Mailing, Insurance, Registered Mail, and so on.
  • To see your outcome, click “Continue.” See how much it would cost to mail your letter or item to its final destination.
  • Pay for your shipment’s shipping and postage. Go to the USPS website. To pay for shipping and print the appropriate stamps, go to the Click-n-Ship page. You’ll need to utilize an online postage provider like Stamps.com to print postage for First-Class Package Service, Media Mail, Parcel Select Ground, and Letters. 

Federal Express- Shipping Prices and Calculator

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If you want to ship some items by Federal Express but don’t want to be surprised by the price, use the FedEx rate tool to eliminate the guessing. You can go over the many price alternatives at your leisure to discover which one best suits your delivery schedule.

  • On their website, go to the Federal Express Rate Tools page. In the dropdown menu available in the Shipping box on the left-hand side of the web page, select one of the services offered for the destination you want to ship the package (the United States or International). If your shipping item is freight rather than a package, an option freight, is also available.
  • By clicking on the relevant option, you may select the FedEx service speed you want to employ for this package (same day, overnight, 2nd day, ground). These options may be seen right next to the shipping destination selection.
  • Choose between the standard rate type (where the item is delivered to your house or office) and the retail pricing type (where the box is picked up by you or your designee at a FedEx outlet in your region).
  • Calculate your shipping prices by selecting the proper file type (pdf or excel) for your computer, then get your rates on the web page.
  • Weigh your box to get an estimate of how much it will cost to send your item depending on your previous destination and service delivery time schedule choices.

UPS – Shipping Prices and Calculator

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If you are thinking of sending your package through UPS then follow these simple steps to send your package through UPS:

You must know the following two things before mailing any shipment:

When do you expect your shipment to arrive?

How much will your shipping cost?

These are the two most crucial things to understand before beginning the shipping procedure. UPS has a calculator that may be used to estimate shipping costs and timeframes for various places around the world where UPS services are available.

Follow the steps below to calculate your shipping cost for UPS carriers-

  • Get straight to the UPS Calculator for getting freight and package rates. This webpage will assist you in locating arrival dates and shipping rates for all UPS shipments and freight services in over 150 countries. It also assists in locating UPS shipping charges for various countries where UPS services are available, allowing you to determine your precise range.
  • Put the mouse cursor on the shipping tab from the site UPS official site ups.com.
  • Select the Calculate Time and Cost from the drop-down menu.
  • Fill in all of the needed shipping information in the form, such as the destination, shipment date, origin, city, and country.
  • It will display the result for the information entered on the right side of the page.
  • There are some extra fields on the right side as well. Fill in these data accurately and click the update button to get the shipping cost.
  • You will now get the cost of the shipment based on the information you have provided.

The following are some of the benefits of utilizing this UPS shipping calculator:

  • You will be given a UPS shipping estimate in the currency of your country.
  • You will also receive shipping information for several items.
  • This webpage may also be used to determine the additional cost that must be applied to the shipment.
  • Get a summary of the review rate in the form of a graph.
  • You may sort your results by cost and time.

You will also receive information about the delivery date, time, and cost of international shipping.

Conclusion: How Can Businesses Reduce Shipping Costs With WareIQ?

As a business, it is crucial to be aware of different ways to reduce shipping charges when you have to calculate shipping costs to stay competitive and keep prices low for your customers. One way to do this is by using WareIQ.

WareIQ offers businesses discounted rates on shipping, distributed inventory, and 2-day shipping. This means that you can save money on your shipping charges while still offering your customers the convenience of fast shipping. Additionally, WareIQ offers free shipping on orders beyond a certain order volume, which can further help to reduce your overall shipping costs. WareIQ also offers a choice of more than 20 of the best shipping services in the country so you will always be assigned the fastest option, at the best price.

calculate shipping costs_WareIQ services

By using WareIQ, you can take advantage of significant savings on your shipping charges, which will also be felt by your customers. This can help to improve your bottom line and keep your prices competitive. In addition, the convenience of 2-day shipping can help to increase customer satisfaction. If you are looking for ways to reduce your shipping costs, WareIQ is a great option.

Calculate Shipping Costs FAQs