Two Ways to Cover Expenses Without Increasing Product Prices

May 8, 2015 by Vera Startseva, Ecwid Team
Posted May 8, 2015 by Vera Startseva, Ecwid Team

Let’s say that you sell traditional homemade sauces. They are so delicious that your business has grown leaps and bounds. New orders are coming not only from your hometown, but from the rest of the country. Maybe you ship orders via local courier service, and you want to be assured that your glass sauce bottles will be delivered intact. So you invest in lots of materials for packaging: bubble wrap, packing peanuts, tape. We know these things get expensive, and you may not want to increase the price of your product. Here are some ways to help!

We are happy to introduce new Ecwid features to help you solve this dilemma: adding a “Handling Fee” and/or “Shipping Markup”. Now you can add additional costs to an order total, without increasing your product prices.

Handling Fee

A handling fee is fixed and is charged once, per order. It doesn’t depend on the shipping rate, and it helps to cover any additional expenses related to fulfilling the order.

The Handling Fee, with a description, are displayed to customers during checkout. Here is how the Handling Fee looks on the store page:

Screen Shot 2015-05-06 at 09.17.47

In order to set up a Handling Fee in your store, open the Shipping page within your Ecwid control panel, then go to the “Handling Fee” tab. There, you can set the name of the fee and its value as well as a short description to inform your customers of what is included in the cost.

Screen Shot 2015-05-06 at 09.18.00

By default, the Handling Fee is set at $0, and therefore it doesn’t show up on the shopping cart page.

To which orders does the handling fee apply?

The Handling Fee is applied to each order that requires shipping. The rate is static and will stay the same no matter the order subtotal, weight or number of items being purchased.

Each shipping method that is configured in your Ecwid control panel → System settings → Shipping page, will be applied to the Handling Fee, including free shipping methods. So, in the case that you offer a “free self pickup” shipping option to your customers, you can still cover your packaging costs.

When is the Handling Fee not applied to orders?

There are three scenarios when the Handling Fee doesn’t show up on your shopping cart page:

  1. All of the products added to the cart have free delivery. “Free Shipping” for a certain product is set up in Ecwid control panel → Catalog → Products → a product page → Tax and Shipping tab.
  2. The customer used the free-shipping discount coupon.
  3. It’s a digital product, which doesn’t require shipping. Hence, the handling fee is not applied to the order cost as well.

This feature is available on Ecwid paid plans, starting from Venture.

Shipping Markup for carrier-calculated shipping methods

Ecwid allows you to calculate shipping cost of items in the customer’s order by retrieving corresponding rates from the most popular shipping carriers. While the cost given by the carrier is precise, there may be additional expenses involved in shipping the goods (e.g. actually driving to a post office to arrange delivery of the ordered goods). Shipping Markup allows you to cover these expenses by including a fixed fee into the shipping cost.

In order to set up Shipping Markup in your store, open System settings → Shipping page of Ecwid control panel. Then open the carrier-calculated shipping method on which you wish to add a markup, then click the Edit button. When the window opens, then click on “Account details”, the set the Shipping Markup value.

Screen Shot 2015-05-06 at 09.18.29

Once done, the markup will be included in the cost of the shipping option during checkout automatically. To disable shipping markup for a shipping method, change the rate to $0.

While adding a Handling Fee or Shipping Markup can help you manage your costs, be sure to carefully think of what costs you’re comfortable sharing with your customers. Once you’ve determined what works, here are some other things to consider before you click’save’:

  • Make sure that your fees cover your additional expenses within reason
  • Provide a clear outline of what the charge includes and how you will be handling the order before shipping. It will inform customers of what they are paying for.
  • Keep your handling fees low. It will help reduce cart abandonment.

Happy selling!

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