How Does the Shipping on an Online Marketplace Work?

When I first thought about selling products online, I didn’t know how the shipping was calculated, and how it was sent. So, I did some research into how it all works, and put together this helpful article to explain it.

So, how does the shipping on an online marketplace work? There are two options for shipping. You can have the online marketplace ship it on your behalf, or, you can send it directly from your home or office. Either option is recommended depending on your individual needs.

There are advantages to having the marketplace ship it on your behalf, it is called dropshipping. So, below I will discuss when you should use drop shipping or send them yourself, as well as, some helpful tips on shipping from an e-commerce store.

How do you ship online orders?

There are two major ways to ship online orders, traditional shipping and dropshipping.  Dropshipping is where the product is shipped by other people not yourself. Other people package it up, add a label, and send it. 

Why would anyone not dropship? Good question, the answer is that if people don’t know about it they won’t do it. 

Anyone who has heard of dropshipping knows it is the best option if you are in the e-commerce business. Because you don’t have to handle any of the packaging work yourself. You can just focus on your online store and driving sales.

Traditional shipping is where you keep all the stock at your house, office, or warehouse. You can have a small operation or have forkhoists, and a huge warehouse. 

When an order comes in you package the items individually. Then you send them off to the customer. This is labor intensive and expensive to set up. You need to write or print the label, add packaging materials, move it for collection, deliver it to the mail center. All together it becomes very time consuming.

Any manner of packaging should be used for online orders. Typically you should wrap it in one layer of bubble wrap, and tape it together. More fragile items need more. There are also different materials.

How does dropshipping work?

Dropshipping is where you have an agreement with a drop shipping supplier that will send any items you sell, according to Wikipedia. There is some upfront work that gets done so that it runs smoothly. They use an online ordering application to place and track orders.

You would create an e-commerce store after doing some research. Then when orders come in, you place the same order with the dropshipping company you are partnered with.

They then send the product with your label on it to the customer. 

How does traditional shipping on an online marketplace work?

The traditional way of shipping is keeping the products in your house, office, or warehouse. This means that you are 100% responsible for getting your products to your customer. Ways that you can do shipping are:

• Free in-store pickup. When people can visit you on location. People will have a physical store and an online store. So, when customers buy from your online store. 

The item is sent from where it is being stored to your physical store. Then, customers come to your store and pick it up. 

It also saves the customer money if they live close. Courier fees a minimum of $5, so if you’re working in the city, or nearby you can go by and pick it.

• Same-day delivery. This is where the item will be delivered on the same day. This is a service which was made famous by Amazon. It is exceptionally fast delivery. The normal time for delivery of an international item is 2 to 3 days. 

Therefore, same day delivery is only available domestically in the country you are in. This requires technology expertise. 

Both on the website side, and on the logistics side. Most people offer 1 to 7 days shipping. If your delivery times are much longer, then customers will shop elsewhere.

• Free shipping. Many stores offer free shipping on orders over a certain total. For example, you will see many e-commerce fashion stores advertising free shipping on orders over $100. You should test different price points and see what works best for your target market.

What courier service do e-commerce stores use?

The courier service is unique to the country and city in which you live. With an online marketplace you should go to the local post shop and see what packaging options they have available. An excellent article was written by Easyship.com that explains the best shipping and mailing services in the US. You should check it out if you are interested in US based courier companies. Also, many of them also do international shipping.

You should also look on the postal service websites and see what options there are. Once an online store has chosen the courier service that provides the best service they then begin using them.

Once they become successful e-commerce stores upgrade to get bulk discounts. This way they can make for profit on each unit they sell.

What packaging materials are used for online orders?

There are seven main products used in packaging items to be sent from an e-commerce store. These are:

1. Courier bags
2. Corrugated boxes
3. Bubble wrap
4. Adhesive tape
5. Wrapping films
6. Fillers

1. Courier bags

Courier bags are made of waterproof plastic. These are strong and resistant to stretching, but are easy to puncture. They come in many sizes, and some have bubble wrap glue to the inside. They also have an adhesive flap like an envelope.

Don’t stick it wrong or you will have to throw the bag away or add extra tape on top.

2. Corrugated boxes

Corrugated boxes come in many sizes. The bottom and tops are taped closed. If you have items that are too heavy in a cardboard box the bottom can fall out. If you are sending heavy items sometimes you need a pallet crate, or wooden bottomed box. Corrugated boxes are the most commonly used for most ecommerce stores.

3. Bubble wrap

This is the plastic film that has built in bubbles. It protects items when they are dropped. It is like falling into a medicine ball versus falling onto the ground. You bounce and it doesn’t hurt.

4. Adhesive tape

This is tape used to secure the bubble wrap to the items and to keep the box closed.

5. Wrapping films

These are clear sheets of plastic which keep the content more secure. They are wrapped around the final package. Are used for large orders that sit on pallets and also used extensively in packaging warehouses.

6. Fillers

Fillers are shredded paper, fine strands of cardboard, and foam balls. They are put inside the box to stop it from banging up against the sides and other items. 

There are also inflated plastic bags like balloons. They rest in between items. The disadvantage of these is that sometimes they don’t fit perfectly.

The website you are on now is an online marketplace, where we offer free listings. If you are interested in selling or buying products online, you should definitely create an account and see what we have to offer. 

To do this go to the register an account page which can be accessed by clicking here.

Conclusion

Shipping on an online marketplace is done in one of two ways. It is either drop shipped or sent from the online store owner. If it is drop shipped it is sent from a separate warehouse by other people. You don’t have to ship the item yourself. This is a new way of doing shipping which has come about because of the internet.

There are various ways that you can do shipping. You can allow customers to pick up the item from you directly, you can do same day delivery, or you can send within 7 days, which is a typical lead time.

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• How to use Sheepbuy?
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• Is selling online worth it for a startup?

Sources

• Wikipedia: Drop shipping
• Easyship.com: The Best Shipping and Mailing Services in the US