Ecommerce Shipping & Handling Guide [+ Free Checklists]

Offering local delivery is a great way for small businesses to stand out from the competition—and even win sales over ecommerce giants like Amazon. It creates a simple and reliable way for customers in your area to get next- or same-day delivery, and reduces the chances of shipping errors by focusing on last mile delivery only.

Sellers can set up a delivery area within a geographic radius or a list of ZIP codes. Shoppers located within the delivery area can then select an option for local delivery at checkout. If you’re an ecommerce startup with time on your hands, you can make these deliveries yourself to maximize profits.

Speedy delivery has become the norm for many shoppers, largely due to Amazon Prime. Amazon’s vast network of strategically placed warehouses enables its two-day shipping.

By storing goods close to each customer base, shipping is made fast and affordable.

Small businesses can use the same strategy to offer two-day shipping by fulfilling their orders with a widespread 3PL like ShipBob. ShipBob has 40+ warehouses around the world that allow sellers to distribute their inventory and achieve inexpensive and fast shipping through zone skipping.

Visit ShipBob

Same-day delivery promises to get products to the customer’s doorstep on the same day they were ordered.

This shipping method is only possible when merchandise is stored locally in warehouses, distribution centers, or fulfillment centers near the customer. For ecommerce stores to offer same-day delivery on a large scale it requires large amounts of resources, often including a proprietary logistics service.

Overnight shipping guarantees the customer will receive their order on the next business day.

This method is often done cost-effectively by distributing inventory throughout a wide network of warehouses, but overnight shipping can be possible from nearly anywhere through FedEx, UPS, and USPS.

Overnighting a package depends on the order’s weight, destination, and carrier, but most overnight deliveries cost between $27 and $70 to ship. For some products (especially gifts), customers are occasionally willing to pay for this shipping speed—so it can be a helpful option to offer.

Expedited shipping simply refers to any shipping service faster than standard ground. It’s available at a variety of speeds and price points, which determine the exact turnaround time for each order.

With consumer expectations at an all-time high, it’s wise to offer some level of expedited shipping. This can help reduce shopping cart abandonment, build customer loyalty, and increase overall satisfaction.

Eco-friendly shipping is a method retailers can use to reduce their environmental impact and attract eco-conscious customers.

It relies on recyclable or biodegradable packaging materials and typically uses ground shipping to minimize fuel usage and carbon emissions. Some retailers take eco-friendly shipping a step further by operating out of zero-waste warehouses.

To reach customer bases in other countries, sellers must find efficient and cost-effective ways to ship internationally. International shipping is more complicated, expensive, and time-consuming than sending orders within your country. It can be difficult to achieve at a speed and price point that doesn’t deter customers.

Because of this, retailers can either carve out an effective cross-border international shipping strategy or use localized fulfillment in their target countries. Fulfillment partners with a global warehouse network—like ShipBob—are key to helping small businesses reach international markets.

To learn more, read our guide to international fulfillment and cross-border shipping.

Freight shipping refers to the transportation of goods, commodities, and cargo in bulk by land, air, or sea. Freight shipments can be transported domestically or internationally via ship, aircraft, truck, or train.

Direct-to-consumer (DTC) ecommerce stores usually use freight shipping to receive inventory from their suppliers or to send their goods to third-party fulfillment centers.

Read about how to get a freight quote to learn more.

In-house order fulfillment involves performing your own inventory storage and order handling—typically with your own facility, equipment, and staff (or by yourself).

Ecommerce startups often run an in-house fulfillment operation out of a spare bedroom, garage, or rented storage unit. As the business develops and sales increase, the operation can be moved into a larger warehouse facility or outsourced to a specialized provider.

In-house fulfillment is best for:

• Small businesses processing fewer than 10 orders per day
• Well-funded, established operations seeking end-to-end control
• Businesses experimenting with different product offerings, sources, and processes
• Full-time store owners

To learn more, read our ultimate guide to in-house fulfillment vs fulfillment centers.

Businesses can outsource the tasks involved in shipping and handling by using order fulfillment companies or larger third-party logistics companies.

Third-party fulfillment companies specialize in inventory management, order processing, and shipping. They manage all of these tasks on your behalf with advanced infrastructure and guaranteed accuracy.

Third-party order fulfillment is best for:

• Growing small businesses processing 10+ orders per day
• Solopreneurs busy managing their own marketing, product sourcing, and development
• Multipreneurs needing to dedicate time to other ventures
• Part-time store owners who work a separate job

Learn how order fulfillment companies work in our guide.

Dropshipping

Dropshipping is a type of third-party fulfillment that operates differently. In dropshipping, the seller doesn’t maintain any inventory. Orders are directly forwarded to a supplier, who takes care of shipping and delivers the products to the customer.

Read our dropshipping guide to learn more.

A hybrid approach to order fulfillment combines some (or both) of the other order fulfillment methods. This is a popular solution for growing businesses because it offers a lot of flexibility.

Hybrid fulfillment is best for:

• Retailers experimenting with new processes, products, channels, and concepts
• Full-time sellers with the available resources to manage multiple fulfillment methods
• Brick-and-mortar stores expanding into online sales

Whether you’re operating from your home, a rented storage unit, or a dedicated warehouse, your storage and packing areas must support efficient shipping and handling. So, your first step is coming up with a facility plan that provides the following:

• Efficient inventory storage: Your entire ecommerce shipping and handling practices will fall apart if you can’t quickly locate ordered items in your warehouse. A sound inventory management system and the handling procedures we cover below will ensure that you know what you have—and where it is—at all times.
• Room to pick products and pack orders: Setting aside sufficient space to stage, check, and pack orders prevents costly packing and shipping errors (which keeps your customers happy).
• Defined shipping and receiving areas: If your space allows for it, distinctly separating the inbound shipments from the outbound shipments encourages better accuracy, faster pickups and dropoffs, and simpler organization.

An example of a mid- to high-volume ecommerce warehouse layout with efficient storage, workspace, and workflow patterns. Lower-volume businesses can replicate this layout on a smaller scale by keeping the essentials.

How you set this up depends on your space, the items you sell, the size of your staff, and how often you’ll need to pack and ship orders. You can find ways to maximize the space you have and see a sample ecommerce warehouse blueprint in our warehouse layout guide.

Once your space is set up, you can tailor the SOPs we explore below to match your specific operation.

Sound SOPs for inventory management are a key feature of any shipping and handling plan. Without a constant grip on your inventory, the entire operation is subject to errors and losses.

Here are three sets of procedures that can help you efficiently manage inventory as it comes into and moves throughout your warehouse:

Inventory Storage & Tracking Procedures

Organized inventory storage areas promote efficiency and prevent wasted time searching for misplaced items.

How you store and track your products depends on many factors—like the size of your operation and facility, how many different products you stock, and the inventory management technology you use. Small operations can usually get away with simple shelf labels on warehouse aisles, but larger operations often benefit from barcode-tracked stock.

Whatever your system, consistency is the key, and most operations can benefit from inventory procedures that follow a basic methodology like this:

Sample Inventory Storage Area Management Best Practices

• Set up warehouse storage areas with clearly labeled storage and/or pick locations, such as labeled shelves, bins, or sectioned or whole pallets.
• If applicable, designate overstock storage areas and cross-reference these spots to your pick locations for quick access when pick locations run low.
• Shelf, bin, and pallet labels should include product SKU, product name, any variations (color/size), and a barcode (if using scanners).

Inventory Receiving Procedures

The inventory receiving process is pretty straightforward: receive shipments, count items, and update quantities in your inventory management system.

However, two things can derail your efforts: vendor shipping errors and sloppy counting of received items. Both create stock discrepancies that lead to unexplained inventory shortages, unshippable orders, and angry customers. To avoid these costly headaches, follow the inventory receiving best practices detailed below.

Inventory Counting Procedures

Inventory counts are a critical inventory management tool. Two types of inventory counts help keep your numbers on track:

• Annual counts are comprehensive assessments of stock for tax purposes. These involve physically counting every product in your inventory system-wide. Businesses generally do it once to twice a year because it’s time-consuming, labor-intensive, and must be done while sales are suspended (usually during a temporary shutdown).
• Cycle counts are partial assessments of stock for ongoing accuracy—periodic counts of a line, category, or section that can fit into weekly workflows. They’re what keep inventory-based ecommerce companies on track, so you should build these into your usual procedures.

These periodic counts help you identify receiving, storage, and picking mistakes before they become major problems. Plus, they keep your stock areas organized and counts up to date, making annual counts a breeze. Here’s how you can fit cycle counts into your usual procedures:

A good inventory software works in tandem with established best practices and SOPs for inventory management. It allows you to create purchase orders, instantly record received goods, track items by size and color, and make adjustments as needed, plus tie stock numbers to every sale you make. Read our rankings of the top inventory management software.

“Picking” is the process of retrieving specific inventory from your stock needed to fulfill an order. You can pick products in two ways:

• In batches using pick lists
• Per-order using packing slips

The best method for you depends on the technology you use, your order volume, and the range of products you sell.

Whichever picking procedure you use, accurate picks with thorough quality checks are essential to prevent order mistakes, costly corrections, and customer service headaches. Here’s a look at each pick method with SOPs that you can use or tailor to your operations:

Batch Picking Procedures

If you sell just a few different items, you can easily pick stock for orders in batches and simply sort them into individual orders during the packing step. This is a quick way to handle volume-picking for orders that contain a small number of like items. A pick list that aggregates the stock needs for a batch of orders is the tool you’ll use with this picking method.

Per-order Picking Procedures

Per-order picking uses a single order packing slip or invoice as the pick list. Each order is picked in its entirety and moved straight to packing. This eliminates the extra sorting step that batch picking entails.

Per-order picking takes pickers all over the warehouse to fill one order, so it’s not the most efficient way for large operations to pick. But, it often works well in smaller warehouses.

The packing stage is your last chance to make an impression on your customer, and the only physical touchpoint you have, so make it count.

Sloppy and careless packing reflects badly on your brand, so it’s essential to design packing procedures with your customer’s unboxing experience in mind. You don’t have to create stunning customized packaging (though it’s a nice touch), but you do need to show customers that you care by ensuring that their order is both correct and adequately packaged to protect items en route. Use the following packing SOPs:

Final Checks & Error Resolution Procedures

Picked orders must be checked before they’re shipped to the customer. If possible, have staff check other employees’ orders prior to packing. Having the same staffer pick and check orders leads to mistakes shipping out the door (even when barcode scanners are used), and setting up order checking as a standalone task encourages 100% accuracy.

Since mistakes do sneak through, you also need to include a procedure to flag these without interrupting workflow, like this:

Another option is to combine the order checking phase with the packing step. That procedure is listed below.

Order Packing Procedures

You can tailor your order packing procedure to fit the size of your workspace and team—as well as the different options for packaging materials you use.

Whatever your order packing method, it needs to be handled systematically to ensure accuracy every time. Here’s an example:

Get your package’s billable weight by using our dimensional weight calculator.

Some sellers (like subscription box services and businesses that sell just a few items) have consistent, predictable box sizes and weights that make labeling very easy. Others sell a mix of products, so orders ship in a wide variety of boxes and require parcel-specific labeling procedures.

Here’s how to tackle shipping labels for each scenario:

Batch or Same-box Labeling Procedures

If your shipments use just one or a few box sizes with predictable weights, your labeling procedure is fast.

Your shipping software can be configured so that the proper labels print in a batch, or even on each order’s packing slip. Simply affix the order label to the correct packed box.

Single Parcel Labeling Procedures

If you ship using a variety of box sizes, you’ll need to weigh and measure your box and enter this information into your shipping label-printing software.

Most ecommerce shipping software programs let you enter a variety of box sizes and select a box when labeling—which is a handy shortcut. But, you likely still need to weigh each packed parcel, compare rates, and then print labels.

Here’s the procedure for this type of labeling:

You can schedule daily or specific-day carrier pickups with UPS, FedEx, and USPS. Pickups typically occur at the same time each day, so you can plan your packing schedule to align with your pickup times.

Alternatively, you can drop off packages to carriers as needed. Here are ways to make both processes run smoothly:

Daily or Scheduled Carrier Pickup Procedures

Carrier drivers are always in a rush, so it’s vitally important that you separate your receiving and shipping areas and avoid mixing inbound and outbound parcels.

If you have different carriers making pickups, you need to separate your parcels by carrier, as well. If this step is missed, carriers may mistakenly pick up the wrong packages—including those that they dropped off earlier in the day. To prevent these errors, stick with a simple set of shipping SOPs, like these:

Parcel Drop-off Procedures

Dropping off parcels regularly (or occasionally for a special shipping need) follows the same basic procedure as above— except that you load parcels into a vehicle to drop off at a carrier facility.

Carrier locations have varying drop-off methods. Some, like UPS and FedEx, have storefronts that allow you to carry prelabeled packages in and place them in a designated area. Others, like the USPS, have bulk shipment drop-off bays that you can access with approval from the station postmaster.

Once you know how the locations you use accept drop-off shipments, you can tailor a standard procedure to match, like this: