Shipping costs are complicated, generally speaking. For each business there are many possible options for the carriage of their orders. The costs to the business of shipping each order can vary depending on the choice of carrier, the destination country, the destination postcode (zipcode), the size of each package, the weight of each package, the number of packages in the order consignment – and the rates for all of this may vary according to the volume of orders sent out. If your freight is not collected by the carrier, you also need to factor in the cost and/or inconvenience of taking it to the drop-off (e.g. post office, parcel shop, courier depot).
If you’re lucky, the stuff you’re selling is all more-or-less the same size, shape and weight. This makes it an easy decision to choose how to send it and doesn’t need anything hard to set up in your store.
Typically, however, a business picks a combination of shipping methods based on their cost, reliability and convenience: e.g. mail, express parcels, slow parcels and freight. The customer is usually offered a simplified choice between a faster and a cheaper alternative for their order.
While it is possible to implement shipping charges that reflect the cost to the business of shipping each order, this can require a lot of investment in setting up the product data to support it, and it can be off-putting to online customers if delivery prices are unclear or appear high. It is common to implement a charging model in which small profits on delivery of many items off-set the losses on some orders, or where the profit margin of larger value orders is used to cover their shipping.
So the first step is to get an idea of the costs – either by looking at the orders you sent if you’re already trading, or by looking up the rates of the methods you’re planning to use if not. Check also for variation by location (more for outlying areas, other countries and so on), and for restrictions that may apply to individual products – e.g. glass or liquids excluded, size/weight limits, dangerous/illegal goods.
Keep a list of these variations and exceptions – you’ll need it when trying out the different shipping models for a good fit.
Now go through the various shipping models to see which seem to make sense for your store, and try out some numbers for the ones that look promising.
Simplest: Flat Rate Shipping