1. Overview of Magento Shipping in eCommerce
Magento is a leading digital storefront that allows businesses to create their own eCommerce website. The platform allows businesses to control several aspects of their online shopping experience, and shipping of products is one such domain. Through Magento, businesses are able to create shipments and deliver their products to customers around the world through integrated carriers.
Magento Shipping helps businesses streamline their shipping processes through several integrations, extensions and pre-negotiated rates with partner shipping companies to allow businesses to make the ideal for their business. In this article, we discuss how Magento Shipping works and how it can help your business get products delivered to customers.
2. What is Magento Shipping?
Magento Shipping is essentially a solution provided by the Magento digital storefront which allows businesses to ship their products to customers directly from the platform, without having to switch to a different solution. The platform is integrated with leading shipping services providers and allows businesses to create shipments, manage orders, rates, delivery modes and reverse logistics.
3. How Does Magento Shipping Work in the eCommerce Industry?
Magento Shipping is a multi-carrier shipping solution for eCommerce businesses and allows businesses to ship products to multiple locations using the desired shipping partner and offered methods by partner carriers. It offers businesses with shipment rating models to give sellers the flexibility of choosing a suitable pricing strategy for each shipment depending on the size, weight, type and destination of the order.
The platform is powered by artificial intelligence that automatically recommends the ideal shipping partner for order depending on the predetermined parameters. Magento Shipping uses the previous performance & capabilities of different carriers.
4. Which pricing options does Magento Shipping offer?
Magento Shipping allows businesses to ship their products using three different pricing models depending on their requirements. Businesses can choose to charge a flat rate for shipping products, they can use table rates to ship products and they can provide free shipping to their customers.
A flat rate refers to a fixed amount that businesses can charge for shipping their products to the customer. It is the most commonly used pricing model by businesses and allows them to maintain an uncomplicated pricing strategy.
This pricing method is most suitable for businesses that have a homogenous inventory, with little variations in size and shape of different products. It is generally ideal for small businesses with lower order volumes. Flat shipping can be both a fixed amount or a fixed percentage of the order value, depending on the preference of the eCommerce company.
A table rate model can be used by businesses to decide the cost of shipping a product on a case-to-case basis. The method uses different parameters including the price of the product, size, shape, type, and destination of the shipment to calculate the cost of shipping. Businesses can define their own parameters and use different permutations combinations of these parameters to automatically calculate the cost of shipping without the need to individually check every order manually.
Finally, businesses can choose to provide their customers with free shipping. In most cases, businesses choose to have a threshold for offering free shipping to their customers, i.e. the cost of shipping would only be waived if the customers were to shop above a certain amount. For businesses that provide free shipping, it acts as a marketing strategy as well as an incentive for customers to shop more in order to avail free shipping.
Generally, businesses use a combination of these shipping methods to decide the cost of shipping for their orders. Ideally, free shipping is used for shipping products when the total cart value crosses a certain threshold, the flat rate is used to ship items within a fixed portfolio or geography, and table rates are used to ship products when shipping the products is not feasible in either model.
5. How does Magento calculate the cost of shipping an item?
Magento can be used to calculate the cost of shipping an item and presenting it to customers. This is a user-facing facility and allows businesses to calculate the cost for customers in two different ways.
5.1) Calculating shipping costs using Flat Rate
If businesses use the flat rate method, they can choose to have a fixed amount as their shipping fee or define a fixed percentage of the order value as the cost. When a percentage amount is chosen, the Magento platform automatically calculates the percentage of the total order value and presents it to customers when they reach the checkout window. To deploy this method, businesses need to go to the Flat Rate module in the Magento platform and enter the desired value in the “Calculate Handling Fee” section.
5.2) Calculating shipping costs using Table Rate
For businesses that use the Table Rate, they need to create different parameters and combinations to determine the cost of shipping on a per order basis. For this businesses need to open the Table Rat module in the Magento platform and create formulas using the “Condition” section. Here, businesses can define what aspects of the product and order will determine the cost of shipping. Once the conditions are set, Magento will automatically calculate the cost of shipping for different products and present it on the checkout window.
6. List of Carriers Supported by Magento
Magento allows businesses to ship their orders with multiple partners to give store owners the flexibility to choose the ideal partner. Magento Shipping is integrated with four carriers that can be used to ship products directly through the Magento Platform.
Magento Shipping supports the following carriers:
UPS is an international shipping company that is an industry leader in terms of revenue. It allows businesses to ship items to customers in over 220 countries and processes around 4.7 packages every year with the help of its 500,000+ employees spread throughout the world. The carrier allows businesses to generate shipping labels, schedule pickups, track orders as well as send notifications to customers and facilitate cross-border shipping.
USPS is a large international shipping and postal company employing over 600,000 people. It provides dedicated shipping services to eCommerce businesses and allows them to ship directly via the Magento platform. It allows businesses to print labels, track orders and also offers customs clearance services for international shipments.
FedEx is one of the largest shipping companies in the world, shipping over 12.5 million packages every day. It helps businesses reach 220 countries around the world. It employs over 600,000 people and provides several shipping solutions including freight forwarding, international shipping, delivery for specialized items and more. FedEx is also a popular provider of distribution and last-mile delivery services.
DHL is part of Deutsche Post and is a popular shipping company with global operations. It has a reach of over 200 countries and processes approximately 1.8 billion packages every year. It has been offering shipping services for over 50 years and employs a total of 380,000 people. It offers freight, sensitive item shipping, international shipping, scheduled pickups, tracking and more solutions to eCommerce through Magento Shipping.
7. Benefits of Shipping with Magento
Magento Shipping is a multi-carrier shipping service that allows eCommerce stores to ship products from within the Magento platform without having to install any extensions or use a third-party service to fulfill the requirements. It automatically keeps the system information and new features up to date without the need to install extension updates or maintain the carrier management systems.
Since Magento is pre-integrated with several shipping companies the shipping process is faster & smoother. It allows businesses to quickly create shipments, generate quotes, book orders and generate shipping labels.
7.3)Reducing cart abandonment rates
Since Magento Shipping allows businesses to check shipping rates for an item immediately, the same can be extended to the customers on the checkout window. Therefore, when customers get information about how much shipping for a product will cost and how long it will take to deliver an item, the chances of completing a purchase are increased significantly.
When businesses use Magento Shipping they can rest assured about the quality and compatibility of shipping services with their eCommerce store. This allows businesses to save time as well as costs that may be incurred should risk associated with shipping materialize. Magento Shipping is also capable of automatically checking any conflicts with other extensions that may be installed on the platform.
8. What are the features of Magento Shipping?
Magento Shipping allows businesses to perform a variety of shipping-related activities right from the platform without the need to avail of another service. Here are some of the features that Magento Shipping offers its customers:-
The platform allows eCommerce merchants to directly integrate with leading shipping companies to allow a seamless shopping experience. Through Magento Shipping the platform is easily able to generate quotes, shipping labels and book orders.
8.2)Automatic eCommerce fulfillment
Magento Shipping allows online store owners to automate the process of order fulfillment through its several carrier integrations. The business owner is at liberty to create several shipping rules based on conditions which can range from anything such as the value of the product to the destination, and more. These conditions, once defined, will consistently be used by Magento Shipping to fulfill orders without the need to constantly monitor the process.
8.3)Reduced shipping costs
Magento Shipping helps businesses save on shipping costs owing to its multi-carrier integrations. It also helps save money through advanced packaging rules and accurate carrier billing that prevent businesses from spending more than they need to. The platform provides an insight into spending on shipping to assess performance.
9. How Can Online Businesses use Magento for shipping?
Businesses can use Magento Shipping to make out-of-the-box as well as general shipments to several countries throughout the world. Since the platform is integrated with 4 shipping companies, which are FedEx, USPS, UPS, DHL; so businesses are able to receive the best-in-class shipping solutions.
The Magento Shipping service allows businesses to seamlessly generate compliant shipping labels from within the platform.
The platform helps businesses manage all their orders from a single platform, without the need to enroll a different provider or switch between multiple carrier platforms.
Through Magento businesses can easily track all their orders from within the Magento platform, making the process faster, and helping prevent shipping exceptions while simultaneously improving visibility for customers.
10. Final thoughts
Magento Shipping is an intuitive solution, it allows businesses to not ship products directly from their Magento service platform, but also manage orders and track them. The platform is a great multi-carrier management tool and allows businesses to perform a variety of actions through a single dashboard. Ecommerce businesses can leverage the capabilities of Magento Shipping to reduce the cost of shipping, increase efficiency and improve customer conversions.