Why is Shipping So Expensive?

As of 2021, there were more than 2 billion people who shopped online. If you belong in that group, you know how expensive shipping can be. The costs really sneak up on you, and sometimes you just can't click out of that browser fast enough!

Whether you're shipping through UPS, USPS, or FedEx, domestic or international, there are many factors that impact delivery costs. Let's dive into each one and figure out ways you can save in the future.

Shipping Costs for Customers

Why is My Shipping Cost So Expensive?

A number of factors contribute to the total cost of delivering your online order. UPS, FedEx, USPS, and other couriers calculate the final price based on all of the following:

Box Weight
Box Dimensions
Shipping Method
Transit Distance

Box Weight

Every courier has a different cost based on weight, but you can expect to pay between $0.50 to $3.00 per pound when shipping an item.

For this reason, you should weigh a package at home before you take it to the post office or a shipping center. You can even buy a small scale that's specifically used for packages.

Box Dimensions

The package size will affect how much you pay for shipping. Couriers will increase or decrease costs based on the box or envelope's width, height, length, and dimensional weight (how much space it takes up).

To avoid paying extra, be sure to first measure the item you're shipping, and then buy packaging that fits it as snuggly as possible. The less square inches, the less money out of your wallet.

Shipping Method

A majority of packages delivered in the U.S. travel via truck or airplane. Boats and trains are used for larger goods like construction equipment, fancy Lamborghinis, or even live animals!

Packages can travel via:

Ground Shipping

Amazon has their own delivery trucks, but most other ecommerce companies ship with couriers. The drivers have specific routes they take, which include anywhere from 500 to 700 different delivery points every single day.

Air Mail

Did you order a cute plush toy from Hong Kong? Your fuzzy friend will need to board a passenger plane to make it to your door. Bigger or heavier items, on the other hand, may travel on a cargo plane.

Maritime Transport

Livestock, foreign cars, machinery, chemicals, and dry minerals are all shipped via cargo ships. Some of these items are too big or dangerous to put on an airplane, so if they're getting shipped from another country, the water may be the only way to travel.

Rail Freight Transport

Some items are simply too risky to put 30,000 feet into the sky. For this reason, domestic container shipments with hazardous goods will be transported by cargo trains. This includes such items as: cleaning products, batteries, paint, shampoo, hand sanitizer, and electronics.

Transit Distance

The farther a package has to travel, the more shipping will cost. The hardworking people who deliver your mail need to be compensated for their time. The fuel and miles of wear and tear on the vehicle are also reasons why distance affects rates.

Causes of Shipping Delays

Nobody likes to wait for a package, but sometimes delivery is out of a business's control. Shipping delays may be the result of:

Global supply chain issues
National disasters
Unforeseeable accidents
Complications at customs
Traffic & congestion
Faulty equipment/packaging
Political concerns
Lost packages
Illegible shipping labels

Global Supply Chain Issues

The COVID-19 pandemic is a prime example of how the supply chain can be interrupted. Countries around the world went into lockdown, and as a result, the flow of raw materials, the ability to operate factories, and the delivery of goods were all drastically affected. Shipping has been so slow, because quite simply, it's difficult to catch back up.

National Disasters

Hurricanes, earthquakes, tornados, blizzards, and floods can all impact shipping. It's not safe for trucks, planes, ships, and trains to make deliveries in severe weather.

Unforeseeable Accidents

Life is unpredictable and accidents happen every day. Just look at the Suez Canal obstruction that occurred in March 2021. The major waterway was blocked for six days due to a stuck container ship. This halted all trade and maritime deliveries that were made using the Suez Canal.

Complications at Customs

International shipments can get tricky since authorities want to make sure that no illegal substances are getting smuggled into another country. Shipments may be held at customs if they look suspicious or if the cargo carrier doesn't have the required documents.

Traffic & Congestion

The airport may have delays and delivery trucks get caught in traffic all the time, but lately it's congested ports that are really hurting shipping times. Fortune Magazine reports that 77% of the world's ports are dealing with longer turnaround times than normal.

Faulty Equipment/Packaging

A mishap could be as small as a damaged box or something even bigger. For example, forty heavy shipping containers fell off a cargo ship near Vancouver Island in 2021. This led to not only damaged goods but also a fire onboard the ship.

Political Concerns

Wars, conflicts, strikes, and other political or governmental concerns may have a direct effect on shipping. Ultimately, ships or planes aren't going to travel through a battle zone so you can get that new blender you ordered.

Lost Packages

Unfortunately, an estimated 10% of packages get lost, stolen, or damaged every single year in the United States. You may end up getting your delivery later than anticipated, but the best retailers have some kind of strategy so don't have to pay extra when this happens.

Illegible Shipping Labels

Teachers wanted us to have neat handwriting for a reason! If a label is too difficult to read, it might end up being returned to the sender. The delivery address has to get fixed before the mail can be resent.

Other Factors That Affect Shipping Costs

You may have noticed that shipping rates are constantly fluctuating. This may be the result of any of the following:

Current Economy

Gas prices, the number of dockworkers or employees at factories, the cost of raw materials, and basic supply & demand all contribute to how much couriers charge for shipping.

Hazardous or Bulky Items

Oversized packages or those that contain hazardous materials may be subject to additional shipping fees. This is also true for temperature controlled deliveries such as the ones received by restaurants or grocery stores.

Taxes & Tariffs

The taxes and fees for shipping vary from country to country. Each territory may also impose tariffs on certain imported or exported goods, which ultimately alter the cost of delivery.

Packaging Materials

Bubble wrap, tape, stickers, and even those little Styrofoam peanuts all cost money. Ecommerce businesses need to factor in those costs when figuring out how much to charge you for shipping.

Insurance on Packages

Are you shipping a fragile item like a crystal award or a diamond ring? It may be worth paying for insurance on that package. You'll be reimbursed if the item ends up damaged or lost in transit.

Season

Snow or ice could affect the cost of shipping. It's risky for trucks and planes to travel in inclement weather, and as a result, couriers may raise the delivery costs.

Day of the Week

It may seem crazy, but some couriers charge more to ship on Friday, Saturday, or Sunday. A weekend delivery surcharge may apply to your online order, so definitely ask ahead of time!

Rush or Overnight Shipping

Are you in a hurry? Overnight, same day, or expedited shipping will raise the costs of delivery for your online order.

As you can see, there are many variables in calculating shipping costs. Businesses need to adjust accordingly so they can not only keep the lights on, but continue to make a profit in the long run.

Calculate Your Shipping Costs

Shipping costs are calculated based on a box's weight and dimensions. The delivery method and distance the package has to travel also impact the total cost.

USPS, UPS, FedEx, and DHL have different delivery rates. Use their shipping cost calculators to figure out how much you'll be charged.

Stats for Success

64.3% of U.S. consumers care more about shipping costs than they do about speed.

About 20% of customers who shop on Amazon do so because of the convenience of shipping with Prime.

Following the COVID-19 pandemic, shipping costs increased by 10% for customers.

Container shipping for businesses has gone up by 350% in the past year.

The Bottom Line

Think of this guide to shipping costs as a crash course in Economics 101. Whether you're a customer or a business, delivery can really hurt your wallet. It's all about staying informed and doing whatever you can to skim costs!

Alyssa Mertes

amertes@qualitylogoproducts.com

866-312-5646 x 277

Alyssa is the Lead Copywriter at Quality Logo Products. As a promo expert, she's uncovered the world's first custom tote bag, interviewed the guy behind rock band AC/DC's logo, and had a piece published by the Advertising Specialty Institute, a leader in the promotional products industry.

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