Magento Shipping Cost: Pricing Guide and How to Calculate Shipping Costs

Ecommerce cost
5mid read March 20, 2022
Ecommerce cost
Magento Shipping Cost: Pricing Guide and How to Calculate Shipping Costs

Shipping is the last mile of the customer journey and an integral part of successful B2B and B2C retail businesses. No matter if you sell clothes, watches, food, jewelry, or tech gadgets, you will need to send your products to your customers. 

If you don’t offer shipping that’s in line with customer expectations, it can result in cart abandonment and low conversion rates. Shipping expenses are something you can’t avoid. In this blog post, we’ll discuss Magento shipping cost and the basic shipping methods provided by the platform.

Ecommerce Shipping Cost Calculator

How do you calculate shipping costs? Shipping costs differ depending on a number of factors. Here are four aspects that go into the shipping price of any product: 

  • Package size and weight 
  • Destination details
  • Shipment value/insurance
  • Delivery dates and times
magento 2 shipping cost

Once these factors have been calculated, the courier service will set a price on your shipment. USPS (The United States Postal Service), UPS (United Parcel Service), and FedEx provide their clients with free calculators, so you can estimate your costs accurately. Magento automatically calculates Magento 2 shipping cost per product.

Magento 2 Shipping Costs and Methods

Magento Shipping is a multi-carrier shipping and fulfillment solution that combines intelligent automation technologies, access to worldwide carrier networks, and smooth integration into Magento administration tools. 

Magento shipping methods are:

  • Flat rate
  • Free shipping
  • Table rates
  • Online rates

Flat Rate 

A flat rate is a standard rate that charges predetermined fees for package transportation regardless of variations in size, weight, or value of the product. This shipping method can be used per product or per shipment. 

Many customers can benefit from this shipping method if they plan to spend lots of money or purchase large items. On the other hand, some customers can order small items, but the price will be too high. In such a case, the total shipping cost won’t be competitive on the market and you might lose potential customers. 

To avoid losing potential customers, you should accurately calculate the average shipping cost for all your products. A flat rate is the easiest way to calculate shipping costs. It can be estimated based on all orders or per item, for instance:

  • $16 for all orders
  • $4 per item

This shipping method best fits companies that have a line of products with similar sizes and weights. Magento offers valid setting options to solve remote location problems. Store owners can restrict flat shipping to particular countries.

Free Shipping

According to the study, 91% of customers will abandon an ecommerce website if free shipping is not provided. Thus, merchants should be aware of the fact that free shipping can be used not only as a delivery method but also as an effective tool to promote your brand. 

In Magento, this shipping method can be used in different ways. It can be based on a minimum purchase, for example, offering free shipping for all orders over $200. Store owners can also limit free shipping to certain countries or link shipping with Magento shopping cart price rules. For instance, you can offer free shipping if customers purchase items from a particular category and the total order cost would be over $100. 

Free Shipping
Free Shipping. Image credit: Villatheme

Keep in mind that this strategy works effectively only if your margin is high or you’ve decided to trade at your own expense to attract new customers.

Table Rate 

Magento table rate shipping gives you an opportunity to set up flexible rules to send your products across the globe. With a table rate method, you are able to determine multiple rates based on various circumstances. With Magento, you can set a price for shipping based on such factors as:

  • Weight
  • Number of products in the order
  • Price
  • Destination (country, state/province, postcode)

You can charge various shipping prices. For example, for a package that ships inside the country you can charge $10, for a shipment outside the country $20-30, or even make shipping free for certain states. With table rates, you need to create a CSV file.   

Online Rates 

Online (live) rates are shipping rates provided by carriers and are a great solution for B2B shipments. With online rates, you can select the best carrier for your brand by the current shipping rate. Magento supports the following global shipping carriers:

  • FedEx (Federal Express)
  • DHL (Dalsey, Hillblom, and Lynn)
  • UPS (United Parcel Service)
  • USPS (The United States Postal Service)
DHL UPS FedEx USPS. Image credit: Picoshipping

Each of these providers is credible and offers insurance payment for lost or damaged packages, and their prices are similar. To integrate any of these shipping carriers in your Magento store, you need to fill in certain data from your service provider and adjust a few settings. Make sure you’ve analyzed that your carrier has been providing you with the best payment conditions or discounts.

To sum it up, shipping requires thorough planning so that your ecommerce business can gain success at the lowest cost. Magento shipping cost is only a small part of the overall ecommerce cost. To answer the question of how much an ecommerce website costs, you’ll need to dig further. 

Find more info on ecommerce development costs in our related article:
Ecommerce cost
How Much Ecommerce Website Costs: Set the Right Budget for Your Project

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