The global ecommerce industry is growing rapidly. While many attribute the industry’s growth in 2020 to the coronavirus pandemic and the lockdown, it was already lucrative long before that.
Retail ecommerce is worth $4 trillion worldwide, and it is expected to keep growing. However, building a successful online store goes beyond having a proper selection of products. You need to provide an experience that keeps customers coming back, and shipping is one of this metric’s primary elements.
This guide includes the following insights:
- 1 The Importance of Effective Shipping For eCommerce Businesses
- 2 ShipBob
- 2.1 How ShipBob Works
- 2.2 ShipBob Features
- 2.3 ShipBob Integrations
- 2.4 ShipBob Pricing
- 2.5 Pick-and-Pack Expenses
- 3 ShipStation
- 4 ShipStation Features
- 5 ShipBob vs. ShipStation: How Do They Compare?
- 6 Conclusion
The Importance of Effective Shipping For eCommerce Businesses
Running an ecommerce business is no small feat. Beyond setting up a shop and acquiring customers, there are other areas in your business that could determine success or failure.
One of such is your shipping. Consistent delays in order fulfillment can be detrimental to businesses, as customers are now used to instant deliveries. According to statistics from Narvar, 53 percent of American online shoppers won’t purchase a product if they don’t know when it would arrive.
Walker Sands also revealed in 2018 that only 15 percent of American shoppers were satisfied with the speed of their preferred ecommerce platforms’ shipping. Given shipping’s importance to the customer experience, ecommerce stores need to invest in building their infrastructure effectively.
While many stores use popular shipping options like USPS or UPS, the smartest brands leverage on strategic shipping partners to increase their margins and deliver to customers.
This guide compares two of the best third-party shipping services — ShipBob and ShipStation.
ShipBob is a 3PL service provider that helps ecommerce businesses store, pick, and deliver their items to customers. The company is based out of Chicago, and it is ideal for small and medium online stores struggling to find effective logistics partners.
While its affordability and convenience are top selling points, what makes ShipBob unique is how it allows you to control the customer experience. With ShipBob, you have a logistics partner that easily handles returns and lets you communicate seamlessly with your customers if there’s an issue.
How ShipBob Works
ShipBob is primarily structured into two services. The first is a software solution for businesses to communicate with customers and manage orders and inventory. The second is a logistics service that handles warehouse inventory and fulfills orders on your behalf.
The service provides next-day and two-day shipping through its vast network of warehouses. Currently, these warehouses are located in Dallas, Chicago, San Francisco, Los Angeles, and New York.
Working with ShipBob is as simple as it gets:
- You send your products to ShipBob, and they keep it in a fulfillment center.
- All orders made to your store are immediately pushed to ShipBob.
- The company processes, picks, and packs your orders.
- They send the product out for delivery and forward the tracking details.
ShipBob’s top defining feature is its ability to let you control the customer experience. The tech-enabled 3PL allows you to send your company’s branded boxes for packaging your orders, creating a memorable experience as customers unbox their packages. In cases where there’s a return or a replacement, you can easily inform your account manager.
With convenience and full control, ShipBob provides a holistic logistics process that allows you to focus on other business aspects.
ShipBob can also serve as a powerful inventory management software that tracks every detail about products in transit. ShipBob has a full-service order fulfillment system that gives businesses the tools, guidance, and reporting required to manage their items across multiple fulfillment centers effectively.
ShipBob makes it easy for customers to return defective or damaged products. Its logistics management software sends customers the shipping details needed to make the returns, and you can automate the entire process to give customers the right shipping labels.
By sending customers their dedicated shipping labels, ShipBob makes it possible for all parties to track products as they go back to you — or, rather, ShipBob’s fulfillment center.
Merchants also get shipping discounts from ShipBob partners like UPS and USPS, and these apply to returns too. However, if you get your own labels, you only have to pay a $3 processing fee.
Quick order fulfillment is becoming more of a significant pull for customers. The same Walker Sands report pointed out that 54 percent of American retailers would pick products with same-day shipping as opposed to items with longer delivery times.
ShipBob offers same-day shipping through partnerships with top shipping service providers like UPS and USPS.
ShipBob’s broad warehouse base allows it to access merchants and markets at low costs. So, the 3PL service allows for quicker and more cost-effective deliveries.
With the distributed inventory function, ShipBob splits physical goods into different locations, keeping them closer to the end consumers. The feature allows you to leverage on locations that are closer to your customers. In time, it reduces your shipping distance and costs.
ShipBob has integrations with most of the major ecommerce solutions. These include BigCommerce, WooCommerce, Shopify, and Squarespace.
The service is also available for companies that run on Amazon. Most non-Amazon Prime members won’t be able to access Fulfilment by Amazon (FBA), the company’s in-house logistics service that offers same-day shipping. For those customers, ShipBob provides a viable alternative.
Instead of charging based on pricing tiers, ShipBob takes standard charges on some services. Here’s a breakdown
ShipBob charges a $25 flat rate for the first two hours of inventory receipt. When that time lapses, it charges $35 per man-hour.
Warehousing and Storage
For storage, ShipBob prices vary based on the size of the product. The company charges:
- $5 per bin
- $10 per full shelf
- $40 per pallet
All costs are charged monthly.
If an order contains five picks at most, ShipBob does that for free. From the sixth pick, the company charges $0.20 per pick.
These vary on ShipBob. The service calculates costs based on the product’s dimensions, weight, and destination. It also considers the shipping service that you use and what it will charge.
ShipBob also offers prorated pricing, which reduces your cost on hot products that sell fast. So, if an item on a pallet sells out halfway through the month, ShipBob charges you $20 instead of $40
ShipStation is a web-based, multi-carrier shipping tool for ecommerce businesses. The service was built to streamline the logistics and order fulfillment process. Like ShipBob, ShipStation offers its services to small and medium-scale ecommerce stores. However, this service also works pretty well for large-scale stores that handle tens of thousands of orders in a month.
How to Set Up ShipStation
- At the most rudimentary level, ShipStation imports orders from your store. Here’s how the service operates:
- When a customer places an order, it gets added to ShipStation
- You will need to give ShipStation all the details of the order to create a label for it
- Once you set up your shipping options, ShipStation gives you a direct postage rate
- There’s also a Rate Calculator that shows you rates across several available shipping providers.
- Once you create your shipping label, ShipStation notifies your shipping channel and your customer.
- Your postage provider also gives you a tracking number for monitoring orders in transit using geo-tracking.]
ShipStation also provides the tools needed to manage the fulfillment process.
For now, ShipStation has integrations with shipping solutions across the United States, the United Kingdom, Canada, and Australia.
The custom views feature helps you to tailor the ShipStation interface to your taste. You can pick what you want to see and check it out through the “Display” option. ShipStation also allows you to choose between different interface sizes and menus for your default page.
Like ShipBob, you can brand your packages to provide a better customer experience. From the tracking page and customized shipping labels, ShipStation provides access to optimal personalization.
Once a business scales, the process of managing inventory through carriers can be tiring. ShipStation has integrations with several carriers, helping you to handle all of the critical tasks. From printing labels and managing order fulfillment to package tracking and more, ShipStation does it all.
You can connect the software with your preferred carrier and conduct the shipping process from ShipStation’s desktop or mobile app. The service also supports international shipping — one area where ShipBob is deficient.
Currently, carriers available on the ShipStation tab include USPS, FedEx, Royal Mail, UPS, Canada Post, Amazon FBA, DHL, and more.
With ShipStation, you can import order data from over 40 sales channels. The ShipStation software uses specifications to assign shipping preferences to each order. So, you can import your orders directly from particular sales channels and add a carrier. From there, you will be able to create shipping labels and send your product to the customers.
The reporting tools on ShipStation offer some interesting analytical insights. You can measure order details, shipping costs, inventory statuses, product highlights, and more.
ShipStation has a batch shipping feature that saves you a great deal of time. It lets you print multiple labels at once, thus cutting the processing time. Remember that you can use the automation rules also to assign specific shipping services to certain package types.
You can also batch orders together, thus effectively consolidating and picking items at the same time. Like ecommerce services reduce fuel consumption by putting deliveries in a single trip, you can consolidate your orders into one picker’s picklist and lessen the trips that they will have to take around the warehouse.
ShipStation also integrates with different marketplaces, ecommerce platforms, and shopping cart services.
Some of the top integrations on ShipStation include 3dcart, BigCommerce, Weebly, PayPal, eBay, WooCommerce, and more.
ShipStation has a stable pricing system that includes the following tiers:
- Starter Plan: This plan costs $9 a month. It is available for just one user, and it supports a maximum of 50 monthly shipments.
- Bronze Plan: This plan costs $29 a month, and it accepts a maximum of 500 monthly shipments
- Silver Plan: The plan costs $49 a month. It takes two users and supports a maximum of 1,500 monthly shipments. This plan adds live chat support to the former two available.
- Gold Plan: This plan costs $69 a month. It accepts three users and supports 3,000 maximum shipments.
- Platinum Plan: The plan costs $99 a month. It accepts five users and a maximum of 6,000 shipments.
- Enterprise Plan: The plan costs $159 a month. It accepts ten users and a maximum of 10,000 shipments monthly. You also get phone support, along with the other three customer service channels.
- If your store handles over 10,000 monthly shipments, you will have to contact ShipStation to request your service quote.
ShipBob vs. ShipStation: How Do They Compare?
ShipBob and ShipStation are very similar in their product offering. However, they vary in two primary areas.
- While ShipBob is best for small and medium stores, ShipStation handles orders for large-scale stores as well. ShipStation is available for international shipping, thanks to its fulfillment centers outside the country.
- While ShipBob handles international shipping too, it does so through the integrated services on its platform. Through integrations with partners like Royal Mail and others, ShipStation ensures a more seamless overseas logistics service than ShipBob.
- However, ShipBob does better in terms of customer experience handling. The service allows you to control every aspect of the fulfillment process, including communicating with customers and relaying concerns back to the 3PL. The service has a more reliable customer support system that answers in real-time and gets the job done faster.
- ShipBob’s lack of a shipment cap is also advantageous, although customers will most likely prefer ShipStation’s simple pricing structure.
- There’s also a difference in their pricing levels. ShipBob packs multiple costs into its service, and all of that can seem a tad complicated. ShipStation, on the other hand, is more direct in its shipping. With ShipStation, you have a fixed rate, and you know what each pricing tier offers.
Any of these two services will be ideal for an ecommerce business. However, given ecommerce stores’ high scalability chances, ShipStation appears to be the better choice for merchants with strong growth potentials.
Shipping is one of the most significant requirements for any ecommerce business looking to succeed. The market is efficiency-driven now, and your shipping speed can significantly determine long-run customer loyalty.
This need for efficiency is why services like ShipBob and ShipStation are more critical. From providing a vast network of partners and fulfillment centers to helping you with item returns, these services make it easier for you to handle your entire shipping process.
With this guide, you should have an overview of what they offer and which will best fit your business model.