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E-Commerce Tutorial            Lesson 3              Page 3                by Kevin Hakman

  — Shaping Up and Shipping Out — 


    One of the most important things to remember about shipping is that the cost of sending your product isn't necessarily the amount you'll want to charge your customer. Your actual costs may be more related to delivering convenient customer service.

    For example, Webvan offers free shipping on orders above a certain dollar amount as a tactic to increase the average size of orders.

    Many online merchants have adopted the best practices of the direct-mail catalog industry by charging fixed amounts for shipping and handling based upon the dollar size of the order and limiting customers' speed-of-delivery options to regular, faster, and fastest.

    Which tactic should you use? Again, you'll have to research the approach that will work best with your customers. There are several packages and services you can review to help you decide.

  • Tandata offers shipping calculations based upon the shipping tables updated by major parcel services. And its Progistics Merchant product can be used with a variety of e-commerce systems (covered in Lesson 4).
  • UPS and FedEx have opened up their interfaces to developers via the Internet, and off-the-shelf storefront packages are available as ready-made plug-ins to these services. (Check out each service's website to learn more.) This means you can get real-time pricing as well as shipment tracking numbers for each order.

    Another important thing to remember is that shipping costs vary by weight. If you're selling more than one product, you must find a way to provide weight information about each product for whatever shipping solution the customers choose. So be sure your product database has a place to store a weight value.

    You'll also need to provide the addresses the parcel is shipped from and shipped to. Make sure you let your customers know when P.O. boxes are going to be an issue, and don't forget to ask for their desired speed of the delivery. Your customers will appreciate that!

    Before you start shipping those goods, though, you need to collect payment.

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