Part 2-Are you REALLY selling nationally?

Forecasts say that online sales will grow again in 2011, even in our current economy. If you do business online, will you get your share? Eliminating as much cart abandonment as possible can definitely help. As you plan your online sales strategy, your shipping system can give you the information you need to make your final pricing right for your customers.

For your customers (and potential customers!), do you charge different amounts for shipping depending on the package destination? If so, your price is different for the same item, depending on where your customer lives. When you visit any local store, do they ask for your ZIP code before you get the price? OK, maybe that’s a bit of a stretch, but no one is happy to know they are paying more than someone else for the same item. And shipping “sticker shock” is a documented factor that creates abandoned shopping carts.

What strategy can solve this? A number of experts and Internet entrepreneurs report it is very important to display shipping charges before check out to avoid shopping cart abandonment. Flat rate shipping strategically mixed with "free" shipping offers can successfully attack this problem. Now, how to do this?

Of course, free shipping is very easy to calculate. Determining the right flat-rate shipping charge takes a little more effort. The easiest way is to use your actual carrier rates in your shipping system, then use historical reporting directly from the shipping system. As an example, the CPS shipping software, using your actual carrier rates, provides its FLAT RATE SHIPPING CHARGE ANALYSIS report:

(Click to enlarge)

This report shows average shipping cost per package and average shipping cost per pound. Choose all the carriers you use or specific carriers. These costs are also displayed by service - next day, 2 day, 3 day, ground and international services. With just a few mouse clicks you can keep tabs on your shipping costs for any period of time by carrier and service. Use this information to accurately manage your flat rate shipping cost offers and your “break even” point to stop shipping cost shock and reduce abandoned carts.

You might be able to get these same numbers from your carrier bills, but carrier invoices I’ve seen are very far from “user friendly”. When you need critical information right now, it’s so much easier to just "Click" and get what you need in seconds. This example describes Harvey Software’s CPS shipping system, but you may find similar reporting in your shipping system.

You should monitor costs at least monthly so you can make adjustments if needed. One popular marketing/sales technique is to use flat rate charges as your standard shipping price, then offer free shipping for special times of the year like holidays when competition is very hot for consumer dollars.

Use these tips so your shoppers from across the country click "Buy" instead of "Bye".

For more information about CPS, visit http://www.harveysoft.com/.

Are you REALLY selling nationally?

Are you marketing nationally but most sales are local? A recent caller from the New York City area suddenly realized this. He called because he wanted a shipping system to let him change from just using a just single carrier to using a choice of carriers. But before long he brought up his 50-60% cart abandonment rate. He also said he charges his customers his exact shipping amount so he does not "screw" people (gotta love NYC!) by charging them more than his actual carrier shipping cost.

Next, we talked about his markets. “Do you want to sell your products to people in Florida?” He said "Yes!" "California?" "Yes!" He knows his shipping costs are higher to ship to Florida or California vs. a customer in New York. As he talked, he started to realize that when he makes his products more expensive to customers who are farther away, he makes his business local or maybe regional, but not national. His “Ah Ha!” moment what when he made the observation that when he shops at stores in his area, it would be strange if they asked where he lives, then charged him a different amount compared to another customer living closer or farther away.

As we talked, he could really see that when he makes his products more expensive nationally than locally, it limits his market and leads to a primary cause of abandoned carts – the unpleasant shipping cost surprise.

"How do I get around this?" he asked. I suggested that he offer flat rate shipping for ground and air service to make his prices look competitive nationally. Then he should monitor his average charges on a weekly and monthly basis to determine if he needs to adjust his flat rate prices. Besides increasing his national sales since shipping costs will be the same for all, he also thought that it would be much easier to maintain shipping process at his web site.

Are you where he is? Next time, part 2 - an easy way to discover the right "flat rate" price to charge for your shipping, then use it to simplify web site shipping cost calculations and gain more sales. A hint? The shipping system is a key component in this. Our CPS(TM) shipping software helps with both of these. To get more information now about CPS, visit www.HarveySoft.com.

Make Customers Happy All the Time and Especially in the Busiest Times

You got the order, you have the products, and they are on the way to your customer. Now, after they place their order, what do your customers think next? If they are like most, it’s likely "Is it on the way and when do I get it? Show me!" Isn’t that what everyone wants to know? And you definitely want your customers to get that information from you. How is the best way to do this and show your customers great service?

The preferred way today is to send them an email to let them know their package is on the way. And a terrific way to do this is for the email to be sent directly from the shipping system. This is where a multi-carrier shipping system like our Computerized Parcel System (CPS™) can help. Here is how this works in CPS. The CPS SHIP eLERT® is sent directly from your company to your customer, it is quick and easy for you to send, and it gets the information to your customer right when the product is shipped. If you use some other type of notification now, sending a SHIP eLERT can take its place and make notifying your customers a simpler process.

Although there are many more advantages to a multi-carrier shipping system than just timely shipping notifications, consider this one point. If you use a carriers' dedicated shipping system and send the shipment notification from their system, take a look at that notification. First, it's not from your company, it's from the carrier. Also, notice how far into the notification you have to go before it's clear the package is from your company. With the CPS shipping software, you use your company’s email address. There is no doubt the shipment notification is immediately identified as coming from your company with the information they expect to see about delivery of their order. Great service keeps customers coming back. When it’s also a better process for your company, you have the best win-win situation. For information about CPS, visit our web site at www.HarveySoft.com.

If You Do International Shipping, You Will See These Forms

Following last week’s international shipping information, here are some of the documents encountered in international shipping with a short description for each.

Generally for international shipping you must provide a description of what you are sending, the quantity and price that will be used in customs clearance, whether it is a commercial invoice for UPS or FedEx or the 2976 or 2976A form for the US Postal Service.

Commercial Invoice
The Commercial Invoice describes the entire shipment and the transaction. It shows terms, payment, who shipped the items, who is receiving them, the date shipped, tariff and product classification codes used by the governments involved, plus other details. It is also the primary document used by Customs worldwide for commodity control and valuation.

Certificate of Origin – NAFTA Certificate of Origin
Some countries require a Certificate of Origin (CO) for certain products to establish the country of origin for the shipment’s products. The CO may be needed due to various reasons, including: making sure the goods from a certain country can be imported into another country; that the quantity ordered is OK to import; to determine the duty rates; or goods from one country may receive preferred treatment when going to another country.

A NAFTA Certificate of Origin can be used for shipments from the US to Mexico or Canada as long as the products meet the criteria for North American Origin. There are special benefits for these goods.

The descriptions and amounts on the CO must match those entered on the Invoice. Check to see if the country you are shipping to requires a CO for your goods.

Shipper’s Export Declaration
The Shipper’s Export Declaration (SED) is used to compile U.S. export trade statistics and for export control. With some exemptions, for shipments to foreign countries the Department of Commerce requires the SED for all shipments with individual items valued at $2,500 or more ($500 for Parcel Post Shipments). This form is also required if an Export License is needed or if the shipment has been consigned to a controlled destination.

An SED is needed for shipments between the United States and Puerto Rico or the Virgin Islands of the United States. An SED is also needed for shipments from Puerto Rico to the US Virgin Islands. Stiff civil and criminal penalties can result when the SED is not provided or contains incorrect information. SED information can be filed online at http://www.aesdirect.gov/.

You must also include the Harmonized System Classification or Schedule B code for the product. The Harmonized System (HS) Classification is a 6-digit standardized numerical method of classifying traded products. HS numbers are used by customs authorities around the world to identify products for the application of duties and taxes. Additional digits are added to the HS number by some governments to further distinguish products in certain categories.

In the United States, “Schedule B” numbers are also used to classify exported products. The U.S. Census Bureau administers the Schedule B system. Schedule B numbers, not HS numbers, must be provided on the Shippers’ Export Declaration (SED) whenever this document is needed. The Census Bureau uses SEDs and Schedule B numbers to calculate U.S. export statistics.

There are differences between the HS classification number and the Schedule B number. The HS number is an internationally accepted code. The basic HS code contains 6-digits, known as a subheading. The Schedule B is a 10-digit code built upon the first 6 digits of the HS code. Additionally, the Schedule B code is a US-specific coding system used by the U.S. Government to monitor U.S. exports. Here is an example in the section on Coffee, Tea, Maté and Spices:
http://www.census.gov/foreign-trade/schedules/b/2011/c09.pdf. You can read more at this government link: http://www.export.gov/faq/eg_main_017509.asp.

Look to your shipping system to make international shipping easier. For example, our CPS(TM) shipping software helps prepare the USPS’ 2976 and 2976A forms as well as printing commercial invoices and certificates of origin - including the NAFTA certificate of origin. All of the product information, including the codes and classifications, can be stored in the CPS product data table. CPS can also read product information directly from your data tables. For the final step, CPS also sends customs data directly to the package carriers to meet the carrier and government requirements. Every step here helps a shipper’s processes for the smooth delivery of packages and to reduce the time it takes to ship an international package. For information about CPS, visit our web site at www.HarveySoft.com.