When your customers place an order, their satisfaction and repeat business could be in jeopardy with poor shipping management. When the package arrives late or not at all, you've lost future revenue.
That's why shipping software is seen as an invaluable tool for any business that ships products—solutions are available to help streamline the entire process, from the second the order comes in to the moment it arrives on the customer's door.
This guide is designed to help you learn what shipping software can do and which features and capabilities to keep in mind when seeking a solution.
Here's what we'll cover:
What Is Shipping Software?
Whether your store is online or a brick-and-mortar location, shipping software allows you to manage orders as they arrive, determine the most appropriate shipping option, generate printed shipping labels with all the correct information and send the package with your preferred carrier.
A lot of work goes into making sure each order is fulfilled accurately and at an acceptable cost, and shipping software assists or, in some cases, fully automates parts of the shipping process.
Due to the growth of e-commerce businesses, shipping software vendors offer a wide array of integration options with carriers to offer the best possible rates, no matter what you're shipping.
A list of orders and order details in ShipStation
Common Functionality of Shipping Software
Shipping solutions can offer a wide variety of features, which often include several of the following:
|Order management||Sort and prioritize each order based on predetermined filters, or users can manage manually. Most systems offer a “dashboard" where users can see all orders and their status to avoid lost packages.|
|Label printing||For bills of lading or shipping labels, many systems offer tools to streamline label generation for large batches.|
|Order tracking||Monitor orders and customers can track them using emailed tracking numbers.|
|Drop shipping||Facilitates selling for stores that don't stock all their products. Instead, when they sell a unit, the store buys it from a third-party and has it shipped directly to the customer. Software can help manage this specialized process.|
|Route optimization||For companies using a private fleet for shipping, this helps reduce costs by finding the quickest, cheapest route to a delivery.|
|Rate management||Find and compare the best carrier rates in real time. Most systems work with the top carriers, e.g., USPS, UPS, DHL, FedEx.|
|Reporting and analytics||Spot trends in shipping operations, such as cheapest carrier rates or average cost per trip. This gives users the ability to make more strategic decisions based on historical data.|
What Type of Shipping Software Buyer Are You?
Shipping software users can expect some key benefits specific to their business type. These can include:
- Retail. Physical stores are competing against giant online retailers and trying different methods of shipping to make deliveries more convenient. In addition to typical benefits experienced from integrated software, such as boosts in efficiency and accurate tracking, shipping software can help facilitate methods such as ship-from-store, where retailers fulfill orders from nearby stores instead of remote distribution centers.
- E-commerce. The key benefit of shipping software for online stores is the level of information you can offer customers; From purchase to delivery, customers can see when and where the item was shipped and how soon it will arrive, which can reduce customer service phone calls.
- Third-party logistics (3PL). These companies often help e-commerce companies operate a supply chain, so retailers can focus on marketing and customer service. 3PLs want to ensure their shipping processes are optimized to maintain service quality, and shipping software can offer real-time dashboards that reveal trends about key shipping metrics.
In addition to partnerships with carriers, many shipping software users choose to integrate other solutions to close the loop on the supply chain and gain a more holistic view of their business. Some of these integrations include:
- Accounting systems. From QuickBooks to Xero, shipping systems can sync up all your financials with your order data for a more conclusive view of operations.
- Online marketplaces. There are hundreds of places to offer your products online beyond your own website. Shipping systems can also integrate with dozens of the top online retail companies, such as Amazon, eBay, Walmart, Etsy and more, to reach a larger group of potential customers.
- Marketing solutions. No marketing means fewer customers. Connect your shipping system to marketing solutions like a CRM or email automation products to personalize offers and boost brand loyalty.
Market Trends to Understand
Here are a few important trends in the shipping industry that could impact your business:
- Drop shipping grows in popularity, reduces inventory costs. The number of companies utilizing drop shipping is growing. This method allows retailers to offer more items online, but don't have to keep them in stock. Instead, suppliers ship the items directly to customers.
Many companies find the inventory cost savings compelling, though the trade-off is that retailers must pass control of some of their supply chain, which may result in less company visibility into shipping processes.
- Most shopping now done online. A 2016 study performed by comScore and UPS found that most purchases now occur online. It's no surprise that giants like Amazon are changing the way consumers purchase everyday items, so strong shipping software should be a priority for online stores. Shipping systems that integrate with your website can offer customers various shipping options to help increase convenience for consumers.
- Gartner predicts blockchain's big supply chain disruption. Blockchain, a distributed, decentralized ledger that records a history of transactions and typically associated with the crypto-currency Bitcoin, also has significant implications for the supply chain, Gartner claims:
“For shipping, blockchain could reduce trade documentation and processing costs, and eliminate extra time and errors that result from manual paperwork to track goods. In addition, real-time visibility and the availability of information for risk analysis will improve accuracy and accelerate shipping at ports.
By securing information, blockchain will aid in mitigating counterfeit products. During Gartner's research for the 2017 Supply Chain Top 25, we found evidence of manufacturers considering the use of blockchain to secure products and deter counterfeits during loading and transport."
(The full report, “Supply Chain Brief: Is the Use of Blockchain in Transportation Hype or Reality?" is available to Gartner clients.)