How to decide which delivery option to use in your eCommerce store
Getting your eCommerce store courier delivery sorted out and costed
I recently had a quick chat with the courier company driver in my area and enquired as to how busy he was with regard to delivering eCommerce store related goods in my area (a small suburb of Fourways).
His answer was that he only delivers Superbalist and Takealot goods and does about 60 deliveries per day. Not bad for a very small area.
What does this mean for a budding eCommerce store entrepreneur?
Is the market ready to buy from smaller eCommerce stores and is the delivery infrastructure in place to ensure that the store owner can deliver to a shopper at a reasonable price and still make a profit?
The answer is yes, but before you start building your eCommerce store be sure to take a 14 day free trial with Shopify, they offer an ever-growing list of courier company plug-ins that integrate directly with your Shopify store.
Naturally, you should be aware that cheaper products are more difficult to deliver profitably and you should consider which costing model you will use.
The most common options are:
- Add your delivery fee at checkout based on the client’s location and order size
- Free delivery to certain central areas and paid to more outlying ones
- Free delivery when purchasing more than a minimum order amount
- Free delivery no matter area or size of order
A fair amount of consideration needs to be given to as to which of these will suit your business best.
Factors to consider are:
- The image you wish to project and will you, for instance, add free delivery as an attraction to shop with your store?
- Your returns policy, how does that affect your costings?
- Are you drop shipping, are the goods that you sell collected from your supplier and what structure do you have in place with them? Do you send them the order and they handle delivery or do you take care of the process?
- Does your site use a plug-in directly to your courier company, that facilitates ease of courier order or do you have to do it all manually, what is the cost of doing it manually?
- Where are your products kept, in your warehouse and the courier company collects daily at a cost and distributes from there, thus incurring a two-way cost?
- The cheaper and faster model may be to keep your stock at the courier companies warehouse and to let deliver from there on your instruction.
- You will also need to consider whether you will supply your products for international purchases and what your delivery costing model will be around this.
It is well worth talking to a few courier companies and comparing pricing and efficiency models.
In general, you will find the franchise driven courier companies to be cheaper than the corporate-based ones but the corporates ones may offer better eCommerce related services.
Remember, for your clients, the primary consideration after they have made the purchase is the speed and condition that their products arrive in, at their destination.
A recent survey of eCommerce website owners done by Insaka eCommerce, the top three courier companies chosen by the respondents were.
1. The Courier Guy (used by nearly 50% of respondents)
If you are looking for an all in one fulfilment service that you can outsource your inventory and warehousing to and that will take care of the deliveries too, then the following companies were rated best:
1. Parcelninja, their business model seems to be best suited for expanding eCommerce in South Africa.
2. Parcel IT
3. On The Dot
Be sure to ask about whether they offer automated plugins that work from within your store.
You can also try SkyNet, Aramex, SA Post Office / Speed Courier Services, Ram Couriers, Dawn Wing Couriers, Courier IT, The Courier Guy, DHL or UTi Sun Couriers (they also now have delivery boxes at Engen Petrol Stations).
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