An Entrepreneur’s Guide to Understanding Shipping Labels for E-Commerce Stores
Posted November 15, 2016 by Jesse Ness, Ecwid Team

An Entrepreneur’s Guide to Understanding Shipping Labels for E-Commerce Stores

Shipping labels are an often overlooked part of running an e-commerce business.

In the excitement of product launches and new marketing initiatives, it’s easy to forget about this small but critical detail.

Shipping labels help machines and humans in your supply chain — storage warehouse, customs, courier, etc. — understand your package origins and its shipping destination.

As you can imagine, failure to create clear shipping labels can result in a logistics disaster. You can lose packages en-route, deliver the wrong package and cause long-term damage to your customer experience.

To help you out, we’re going to show you how shipping labels work, what information they should contain and how to print them.

The Anatomy of Shipping Labels

You’ve probably seen a label like this on the last product you ordered online:

Shipping label

This is an example of a real-world shipping label.

At the very least, a shipping label shows the following:

  • Who shipped the package, i.e. its place of origin
  • Where the package is being shipped to, i.e. its destination
  • The weight of the package
  • Shipping class (express, overnight, etc.)
  • Tracking number
  • Routing code for postal tracking

Besides these, the label can also show billing status (pre-paid, COD, etc.) a MaxiCode (more on this below), service level, etc.

For example, here’s a USPS shipping label:

Let’s break down each of these elements one by one:

1. Service icon block: This block indicates different USPS services. As of now, there are six different service levels, denoted visually like this:

service icon block

Here’s what they mean:

  • P — Priority Mail
  • F — First-Class Mail
  • E — Priority Mail Express
  • Solid box or box with intersecting lines — Parcel Select, Media Mail, Bound Printed Matter
  • Empty box — Critical Mail

Keep in mind that this applies only to USPS. Other providers might have different service levels here.

2. Service level banner: This banner simply states the service level as denoted by the block above.

In this case, it’s Priority Mail.

3. Postage payment area: This section is for showing postage payment information.

With USPS, bulk mailers, such as retailers can apply for a “Mailing Imprint Permit” which allows them to pay for and print shipping information in bulk.

At the very least, this section should include the class of mail (such as “Single Piece” or “Presorted”), the city and state of the permit, and the permit number.

Follow the guidelines here to know more about the design requirements for the indicia.

4. Return address: The address where the package should return to in case of non-delivery.

In most cases, this would be your business address. If you are outsourcing shipping to a third party, you’d use their address here.

5. Delivery address: The address you’re shipping the package to.

Besides the address, you also have to include delivery route code information and Retail Distribution Codes (RDC).

This is a four digit number placed next to the zip code (in this case, it’s the number “0004”). It helps mail handlers figure out the route to take to deliver the product.

USPS would generate this code automatically for you when you use their site to print your labels (see below).

6. Tracking code: This section includes the tracking code. Your customers can use this to track their orders.

USPS uses a new tracking code format called “Intelligent Mail package barcode” (IMpb).

This is a new internationally accepted format that helps machines as well as humans read the barcode data (in the form of numbers below the barcode).

You can learn more about the IMpb format here.

Again, keep in mind that USPS would generate this code automatically.

7. Additional information: Any additional information about the package — such as the shipping date or weight — can go here.

Most shipping labels follow the same pattern. For example, here’s FedEx’s ground shipping label:

FedEx Shipping Label

The only thing different here is an additional barcode that can be read by a machine regardless of the direction it is facing.

If all this sounds too intimidating, don’t worry — you just have to fill out fields #5 and #6, i.e. the customer’s address and the return address.

The rest is generated automatically by your shipping partner or your shipping software.

Related: How to Get from Zero to Ship: Carriers, Rates and Strategies

What is a packing slip?

Besides shipping labels, you also need to include a packing slip (also called a “waybill”) with your package.

The packing slip looks something like this:

packing slip

This document is usually included inside a package and shows the following:

  • Your company’s name, logo and address
  • The customer’s address
  • The order date and order number
  • The customer’s contact information
  • The names, quantities and prices of each item included in the package
  • Customer service contact in case of any problems with the product (optional)
  • Optional comments

Sometimes, businesses wrap the packing slip in clear plastic and affix it to the outside of the package as well.

The packing slip is essentially a customer receipt. Besides acting as a proof of receipt, it also tells customers what’s included in their package — particularly helpful when you’re shipping multiple items spread across multiple package.

However, the packing slip is not necessary for shipping. Your shipping service won’t mind if you don’t include it with the package.

Usually, your shipping or invoicing software can also create packing slips. Else, you can use a template like this (Word) or this (Excel).

Related: How to Improve Shipping Processes for Your E-commerce Business

How to Create Shipping Labels

There are two options to create shipping labels — manually through your shipping partner’s website, or automatically through a shipping software.
Let’s look at both these methods below.

Creating shipping labels manually

This is a slow method to create shipping labels but it works if you’re dealing with low volume or are using a shopping cart without built-in shipping integration.

Every major shipping service provider has its own process for generating shipping labels.

For this example, we’ll use UPS’ shipping service.

Start by entering your customer’s address.

Creating shipping labels manually

Next, enter your own address:

Creating shipping labels manually

This is the default billing address. If you want an undelivered package to return to another address, you can add that here as well.

Next, specify what you’re shipping.

Creating shipping labels manually

UPS has different size specifications for its own boxes. A UPS “Small” box, for instance, is 13in x 11in x 2in.

Size specifications for USP boxes

Size specifications for USP boxes

Alternatively, you can specify the package dimensions yourself. Accurate measurements will give you a better estimate of shipping costs.

You can also specify the package value in this section. By default, UPS covers all products up to a value of $100. If you specify a value beyond $100, you might incur an additional charge.

Declaring the package value is NOT insurance. If the product is valuable, you can purchase additional insurance separately.

In the next section, you can choose which UPS service you want to use along with upgrades, some of which are free (such as “deliver without signature”).

Creating shipping labels manually

In the further section, you can add a custom reference number to the shipment. This can be a customer order number or even a phrase such as “thanks for ordering!”. UPS will encode this in the barcode.

Creating shipping labels manually

Finally, enter your payment information:

Creating shipping labels manually

Then review your order before making the payment. Once the payment goes through, you can print out the shipping label and drop off the package at your nearest UPS store.

Most other shipping services follow a similar procedure. You can access their websites here:

Read also: The Last Piece of the eCommerce Puzzle: Shipping and Fulfillment

Use shipping/printing software

If your e-commerce software integrates with a shipping automation tool, you can automate the entire label making process.

Ecwid, for instance, offers two apps to create shipping labels: Shipstation and PrintoutDesigner.

Let’s look at both these apps.

Creating shipping labels with ShipStation

Shipstation plugs into Ecwid to process, fill and ship items to the top couriers, including FedEx, UPS, DHL and Amazon FBA. You can find the app here.

Once you’ve installed the Shipstation app, creating shipping labels is pretty straightforward. Start by logging into Shipstation.

Then click on Orders and find the order you want to print the label for:

Shipstation

You’ll notice that you already have the package weight, size, etc. in the right pane.

To make sure that you’ve got the right shipping rate, click on “Get Rate”.

Shipstation

Once you’re sure of the rate, click on “Create Label” in the top sub-menu.

Shipstation

Confirm your order details and click “Create Label” again:

Shipstation

You’ll get one final confirmation pop-up. Click “Create Label” again on this pop-up.

If you’re doing this for the first time, ShipStation will ask you how you want to print the label. You can choose to save the file as a PDF or send it directly to your printer.

Shipstation

On the confirmation page, you will also have an option to print a packing slip separately:

Shipstation

That’s pretty much it  the entire label printing process essentially takes just a handful of clicks with zero manual data entry.

Read also: International Shipping: Picking a Provider & Shipping Around the Globe

Creating shipping labels with Printout Designer

If you don’t have access to ShipStation, there’s another way to create shipping labels using PrintoutDesigner. After installing the app, go into the “App” tab in Ecwid control panel.

Next, select your order and what you want to print (shipping label, packing slip, etc.).

Printput Designer

You can hit “Edit” to customize the design by adding your logo or other information.

Printout Designer

Once you’ve modified the default template, hit “Preview”. This will show you how the shipping label/packing slip will look like after printing.

Printout Designer

When you’re done, hit “Print”. Congratulations — you’ve just printed a shipping label in just two clicks.

Read also: Read also: 6 Free Shipping Strategies and Their Alternatives

Over to You

The success of your business hinges on customers getting their products on-time. A badly formatted shipping label can cause innumerable logistics issues. It doesn’t help that every shipping company uses different label designs.

Follow the guidelines in this post to format and print your shipping labels correctly.

If you’ve ever faced any issues with printing shipping labels, do let us know in the comments below!