Guide to Holiday Shipping:
How to Manage the Busy Season for Your Store

The holiday season seems to start earlier each year. In fact, in 2022, it may come even sooner than you think.

In 2021, around 43% of shoppers started shopping before the end of October. That upcoming holiday season can mean big business for many companies. To be competitive and attract business, including repeat business and word-of-mouth business, you must manage your shipping strategies and methods well. Today's customers are used to placing orders and getting their items quickly. They want to feel as though they simply went to the store and picked up their items without actually having to do it. 

Managing shipping during a busy holiday season is critical for your business. Many key elements may go into managing shipping during this busy period, and properly navigating the process can improve customer satisfaction and encourage them to trust your brand.

Key Elements of Shipping to Consider During the Holiday Season

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There are many elements of shipping that you need to consider ahead of the holiday season. A careful examination of those critical elements can help set you up for tremendous success and ensure that you are ready to get items out to your customers during the holidays. Remember, satisfied customers, are more likely to come back to your business for their future shopping needs and recommend you to friends and family. Planning your shipping strategy can help immensely with customer satisfaction.

Cost

How much will the shipping cost your business this holiday season? You need to carefully consider the shipping cost, including what services you'll use for shipping and how those services compare to others available in your area. Furthermore, ensure you're prepared for increased shipping costs this year. Many businesses have found that increased shipping costs are cutting their profit margins and making it difficult to meet customer demands. 

Consider how you will handle the increased cost of shipping this year. Will you change your free shipping threshold? Build some of that cost into the cost of your items? Preparing ahead can help you make the most of this holiday season.

Timing

How long will your preferred shipping services take to get items to your customers? Take a look at shipping times based on where your customers often order from and what they are most likely to order. 

Customers often rely on fast delivery times, especially over the holidays. Increasingly, they expect to have their items delivered quickly, regardless of when they placed the order. Options like Amazon Prime have made customers more impatient than ever. By looking at your timing and the reliability of your preferred shipping services, you can often do a better job of delivering those items to your customers promptly—and managing customer expectations when there may be delays. 

Process

Carefully consider what the shipping process looks like for your business. What, exactly, does it take for you to get in those orders and get the items out the door? You may, for example, need to: 

  • Review and organize your orders 
  • Pick inventory
  • Get out packing supplies
  • Print packing slips
  • Pack the order and attach a shipping label

Getting your orders packaged and ready to go out the door can take considerable time. Delays in the packing process can, in many cases, make it more difficult for you to keep up with customer demand. Delays during the holiday season, when people often rush to get gifts in hand, can be highly frustrating for your customers and may prevent them from returning to your business in the future.

Best Practices for Holiday Shipping

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As the holiday season approaches, there are several essential best practices you may want to put into place to ensure that your customers can navigate their holiday shopping successfully. Your efforts can also make it easier to ensure that customers are ultimately happy with the service they get from your brand.

1. Ensure you have the products on hand well before the holiday season.

Long before the holiday shopping season kicks off, make sure you have the supplies you need on hand for your customers. That may mean that you need to:

  • Stock up on shipping supplies
  • Invest in labeling supplies
  • Make sure that you have the proper inventory on hand to meet customer demands

By making sure that you have the right supplies on hand from the beginning, you will find that your business is much better prepared to address the increase in orders that may come in during the holiday season. Furthermore, you won't have to worry about spending time hunting down your shipping supplies in the middle of a rush of orders when you already have them on hand.

2. Streamline your in-house practices as much as possible.

Take the time to carefully look at your shipping procedures and how they may impact you as holiday shopping heats up. What can you do to help streamline your shipping procedures and ensure that those processes go more quickly and smoothly? For example, you may want to:

  • Change the way you sort orders
  • Make sure you have enough order pickers and packers
  • Gather all shipping supplies together in one location

Consider testing some of your shipping practices now to get a better feel for how long it will take to get items out during the holiday season and what methods may help you get things out the door faster. Remember that your shipping practices and needs are unique to your business, so it's important to test changes ahead of time rather than trying to implement them during the busy holiday season when they could slow your business down.

3. Know your shipping deadlines and post them well in advance.

What is the latest your customers can order from you and get items in time for the holidays? Many businesses post an ongoing countdown that lets customers know how long they have to make those last-minute purchases and still get their items in time. Post your shipping deadlines for your customers well ahead of time. The longer it takes for you to get things out the door, the longer it will ultimately take customers to get their items.

Make sure you allow for delays in the shipping and packing processes when setting deadlines. Set deadlines that you know you can meet for your customers. While you may not be able to make shipping services move faster, you can give a fair estimate of how long it will realistically take customers to get their items.

4. Determine what shipping rates you will offer to your customers.

Take a careful look at what shipping will cost your business and consider how you want to manage your shipping costs this holiday season. Keep in mind the possibility of further economic disruptions and how they may impact your budget so that you can set shipping costs that reflect your needs.

Do you want to offer free shipping?

Shipping costs can cause as much as 28% of cart abandonment rates. Customers are often prepared to make a purchase, but when they realize what the final price will look like, including how much it will cost to manage to ship, they may choose not to make that purchase after all. Free shipping can help avoid that problem.

However, if you offer free shipping to your customers, you must carefully consider what it will cost your business. In some cases, you may find that offering free shipping costs more than you can afford, based on your profits from smaller products. You may need to increase the cost of your items to help cover the cost of shipping or offer free shipping only when customers reach a set purchase threshold.

Does flat rate shipping work best for your needs?

Flat rate shipping can make it much easier for customers to determine up front exactly what it will cost them to purchase your business. Flat rate shipping also includes the shipping cost as part of the customer's purchase, though customers who place large orders may end up with higher shipping costs than they pay for. Set your flat rate shipping at a reasonable rate reflecting your expenses. 

Do you want to charge customers based on the actual cost of shipping?

Get a clear idea of what it will cost to ship items out to your customers, and ensure you include it as part of your shipping costs. Lay those costs out clearly, so customers know what to expect when they're ready to make their purchases. 

However, if you choose to charge for shipping, ensure your rates are transparent and clearly laid out for your customers from the beginning, so they know what to expect from you.

5. Give customers clear insights into your shipping options.

Make sure customers know how you typically ship items. You may want to offer them several options to make it easier for them to choose the shipping provider that best fits their needs. Do you use UPS? FedEx? USPS? Make sure customers know what to expect before they get to checkout. Where possible, provide customers with choices to select the one that works best for their needs.

6. Don't forget about returns.

As you move into the holiday shopping season, consider your return policies and what they may mean for your business. Remember that in many cases, you will be out of the shipping cost when you accept returns. Ensure your return policy lays out who is responsible for return shipping and what platform you want to use for returns. You may also want to consider whether you will refund the shipping cost if it is separate from the item itself. As many as 34% of Americans may return gifts they received over the holidays. Make sure your business is prepared for the potential ramifications of those returns. 

7. Make sure your inventory is balanced so that you have something to ship!

In these uncertain times, particularly with the many supply chain issues, it's vital to ensure that you have the proper inventory on hand. You don't want customers to arrive at your website only to find countless out-of-stock notifications and delays! Balance your inventory early in the season. Make sure you know what items you're most likely to need. Predict demand based on historical data and current trends. Then, ensure you order ahead for any products you can keep in stock.

Keep in mind, however, that you do not want to overbuy, which could leave you with overstock that you will later have to sell off at a steep discount or potentially at a loss. Carefully consider what inventory you need to have on hand to meet the season's demands.

Are You Prepared for the Holiday Shopping Season?

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As the holiday shopping season arrives, your company could see a distinct increase in business. However, you have to be prepared for those increases. Not only does that mean having the proper inventory on hand, but it may also mean making sure that you have vital shipping supplies and other critical items. If you're struggling to prepare for the holiday shopping season, OnRamp Funds can help. Contact us to learn how we can help you manage your small business cash flow this holiday season.

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