Visible SCM discusses USPS Cubic Pricing - working to help both new and experienced retailers be as savvy as possible when it comes to shipping.
What are Shipping Zones?
You need to understand how to work with the shipping zones to be used to a company's advantage.
Shipping zones can be a confusing concept for the beginner and novices alike. It is hard to understand what a shipping zone is, how it pertains to you, and how much it costs to ship to another United States zone. Shipping zones are designated by the USPS and determined based on the package's origin to its final destination. The mileage span separates zones 1 to 8 from the source of the package. Shipping zones, size, and weight all help determine the package's cost. Understanding shipping zones can help your business better understand the shipping cost and help determine the best places from which to ship your items.
How are Shipping Zones are Categorized?
- Zone 1: 1-50 miles
- Zone 2: 51-150 miles
- Zone 3: 151-300 miles
- Zone 4: 301-600 miles
- Zone 5: 601-1000 miles
- Zone 6: 1001-1400 miles
- Zone 7: 1401-1800 miles
- Zone 8: 1801 miles or greater
- Zone 9: Designated for Freely Associated States such as Guam, Palau, and other US Territories.
Though shipping zones were created by and originated from the USPS, carriers such as UPS have adopted the same idea, using shipping zones to price out their parcels. Naturally, the higher the zone, the higher price of shipping will be. Companies will generally consider the shipping cost determined by the weight and size shipped to zone 1, and then the price will increase based on the zone. The best way to think about this is to consider zone 1 as your base price, including parcel weight/size. Do you want more information on the Domestic Zone Chart? Find more details here.
When you consider how much a shipping zone can affect your shipping costs, it's best to develop a strategy. When a company is located on a specific coast, shipping to the opposite coast can increase your shipping cost by an estimated $40. Naturally, other factors can adjust that cost. Consumers want fast and free shipping, but shipping zones rely on the shipper to cover those costs. There are a couple of ways to remedy this problem, here's how:
Hire a Large 3PL
3PL, or third-party logistics, is a company that offers distribution throughout the country. Though some 3PLs only have one distribution center, working with a large 3PL allows your company to always stay in zones 1-3 when shipping nationally. Utilizing this method keeps shipping costs down and keeps them quick. Want to learn more about 3PLs? Check that article out here.
Have a Localized Warehouse
Though this can technically mean many things, having a centralized warehouse keeps shipping costs low and fast. Keeping your shipping distribution center in the middle of the United States avoids the higher-up zones. Think, if you are nationally based in Portland, Oregon, and want to ship to a customer in Vermont, then you will pay upwards of $40 extra for the shipping cost (size and weight dependent). Keeping a distribution center or warehouse centralized will pay less for shipping, and the items will get to their destination quicker.
Stay Near your Customer Base
If you're not big enough to invest in a 3PL or warehouse center, then stay close to your customer base. Look to your stats and sales to understand the best place for distribution. If you can't afford to be placed in every 3PL, choose a smaller 3PL or be in one of the warehouses. Locating your business in a specific region or area is the best way to keep shipping costs down.
Hire a Shipping Solution
With DesktopShipper, you are sure to receive the best pricing on shipping no matter the zone. Using a shipping API will help you keep costs down and fulfillment quickly using a 3PL or self-fulfillment method. Eliminate the decision-making and trust us to solve shipping complexities.
#ShipTip: You don't control how zoning works unless you're a gigantic logistics company like Amazon and have your own shipping infrastructure.
On top of the cost associated with shipping to farther away zones, shippers must also take shipping time into account. According to Comscore, 73% of consumers expect affordable shipping. According to Comscore, 73% of consumers expect affordable shipping, while 24% of consumers will cancel a shipment because of slow shipping. Ensuring that customers are getting fast, affordable shipping is the best way to keep purchasing from your store. You need to understand how to work with the shipping zones to be used to a company's advantage.