Logistics management is a key factor in the success of an e-commerce business. Between storage, order preparation and shipping, the associated costs can quickly weigh on profitability. However, efficient, optimized management not only keeps these expenses under control, but also enhances the customer experience by guaranteeing fast, reliable deliveries.
- What are the logistics costs in e-commerce?
- The e-commerce logistics network equipped with Shippingbo
Logistics rates vary according to several criteria: order volume, shipping frequency, storage model and choice of service provider. On average, an e-merchant can expect to pay €0.5 per item for picking, €8 per pallet per month for storage, €0.5 for the entry or exit of a parcel and €2 for the entry or exit of a pallet.
These figures give an initial idea of e-commerce logistics costs, but they can vary depending on the business sector and the level of service required.
In this article, we take a closer look at each element of logistics pricing, and give you some tips on how to optimize your spending and choose the best e-commerce logistics solution for your business.
What are the logistics costs in e-commerce?
Each stage of the logistics process generates specific costs that vary according to the storage model adopted, the volumes handled and the level of service expected. E-retailers need to anticipate these costs to avoid excessive expenditure that could undermine profitability.
E-commerce logistics involves much more than simply warehousing goods. It also includes the management of incoming and outgoing stock, picking, order preparation and shipping. Each of these elements represents an expense item that can have a significant impact on margins. Understanding how they work can help you optimize your e-commerce logistics profitability, and adjust your strategy according to your activity and order volume.
Pallet and parcel storage: how does it work?
The price of logistics storage is based on several criteria: the surface area occupied, the storage time, the type of product stored and the location of the warehouse.
Pallet storage, which costs an average of €8 per month per pallet, is suitable for large quantities or bulky products. This storage method is often used by companies with large items or those requiring uniform packaging. It enables storage costs to be spread over a large volume, thus reducing the unit cost of storage.
More flexible, e-commerce parcel storage is favored by e-tailers with diversified catalogs and small quantities of items. In this case, invoicing is generally proportional to the number of items stored and the space they occupy in the warehouse. This pricing method is ideal for companies selling products of varying sizes, and who wish to avoid paying for unused space.
One of the most important factors influencing storage costs is the location of the warehouse. A warehouse located close to urban areas and logistics hubs will often be more expensive, but will have the advantage of reducing delivery times and therefore improving the customer experience. Conversely, a warehouse located on the outskirts or in a rural area will be more economical in terms of storage, but may generate higher transport costs.
Entry and exit fees: the fork in the road explained
Warehousing represents only part of the logistics costs. Every time goods are brought in and out, handling charges are applied.
The warehouse entry fee covers several essential stages:
- Receipt of products by the warehouse
- Quality control to check condition of goods
- Stocking and referencing in the logistics system
On average, these costs are €0.5 per parcel and €2 per pallet. These costs can increase if the warehouse has to carry out additional sorting, labeling or repacking.
Warehouse exit fees are applied when an order is shipped. They include :
- Handling required to retrieve stock items
- Pre-shipment packaging
- Making parcels available to carriers
Some providers also apply a logistical fork cost, a surcharge charged when products require special handling. For example, when an item needs to be re-palletized, re-composed or packaged differently, additional charges may apply.
Entry and exit costs may seem minor, but they quickly add up, especially for e-tailers handling a large number of orders. Optimizing these costs by choosing a service provider suited to your volume and activity is essential to improving profitability.
Picking and order preparation: how are costs calculated?
E-commerce logistics picking is an unavoidable expense item. This process consists of picking ordered items from the warehouse before they are dispatched. It is often invoiced on a per-item basis, with an average cost of €0.5 per item picked.
The cost of picking depends on several factors:
- The number of references per order: the more different references there are in an order, the longer the picking time, which adds to the invoice.
- Warehouse layout: a well-organized warehouse reduces the number of trips needed to retrieve items, thus optimizing costs.
- The level of personalization: a simple sampling is less expensive than an order requiring custom packaging or the addition of promotional elements.
In addition to picking, order-picking costs include packaging and labeling of products prior to shipment. Some e-tailers choose standard packaging to limit these costs, while others opt for customized packaging, which enhances the customer experience but increases logistics costs.
Good picking management and optimized packaging can enable e-tailers to significantly reduce these costs, while guaranteeing efficient shipping.
Shipping and delivery to the carrier: what factors influence the rate?
E-commerce freight rates are one of the most variable logistics costs. It is influenced by several criteria:
- Package size and weight: the larger and heavier the package, the higher the shipping cost. Some carriers apply volumetric billing, which takes into account the weight and bulk of the parcel.
- Destination: a national shipment costs less than an international one. Deliveries outside the European Union involve additional costs such as customs duties and taxes.
- Delivery method: express delivery is more expensive than standard delivery. Relay points often offer a more economical alternative to home delivery.
- Shipping volume: an e-merchant shipping a large number of parcels can negotiate advantageous rates with carriers, thus reducing overall costs.
Tailor-made logistics pricing allows costs to be adapted to the specific needs of an online store. Some providers charge by the order, others by the total volume shipped.
Good control of shipping costs is essential to protect margins. To achieve this, it’s important to regularly evaluate carriers’ offers, explore alternative solutions such as lockers and relay points, and optimize parcel packaging to reduce the weight and volume transported.
Discover 5 levers to activate to reduce your transport costs by watching the replay of our webinar below.
The e-commerce logistics network equipped with Shippingbo
Faced with the challenges of e-commerce logistics, relying on a network of specialized logisticians is a major strategic asset. These professionals prepare and dispatch orders on behalf of e-tailers.
Shippingbo boasts a powerful network of over 50 e-commerce logistics specialists, with more than 100 warehouses throughout France, guaranteeing optimal coverage and rapid deliveries. Thanks to over 200 native integrations with the main marketplaces, CMS and private sales platforms, Shippingbo enables a fluid, automated connection between merchants and their logistics provider. This cutting-edge infrastructure ensures high-performance logistics management, supported by advanced technologies such as WMS and TMS, optimizing every stage from storage to dispatch. With an ever-expanding network, Shippingbo offers e-merchants a flexible, reliable solution fully adapted to market requirements.
Control variable costs with outsourced logistics
Logistics outsourcing offers a major advantage: a substantial reduction in fixed costs. By entrusting stock and warehouse management to a specialized service provider, you transform fixed costs into variable expenses. This transfer not only reduces your operating costs, but also the financial risks associated with investment in logistics infrastructures.
To maximize your profitability, it’s essential to adopt a flexible, tailor-made approach to logistics. Our specialized partners offer you pricing solutions tailored to your real needs, ensuring that you only pay for the space and services you actually use. This methodologyavoids unforeseen expenses and reduces the need for costlyinitial investments.
With a clear, competitive pricing policy, your logistics management becomes smoother and more financially predictable. As a result, you gain greater control over your budget, and can reallocate resources to strategic areas of your business.
An efficient logistics network to reduce shipping costs
The efficiency of outsourced logistics relies on a network of strategically distributed warehouses, enabling optimized order management and reduced dispatch times. Thanks to a diversified network covering several geographical areas, logistics service providers can store goods as close as possible to end consumers, thus reducing transport costs and delivery times. By strategically placing their infrastructures in different regions, they enable companies to speed up order processing and improve their responsiveness to peaks in demand, particularly during busy periods such as sales or the festive season.
In addition to reducing lead times, this logistics approach alsooptimizes inventory management. By intelligently distributing goods across several sites, companies reduce the risk of stock-outs, and can more easily adapt to variations in local demand. This flexibility is essential for e-commerce players , who need to ensure fast, reliable deliveries while keeping costs under control. What’s more, warehouse diversification enhances the resilience of supply chains in the event of disruptions such as strikes, extreme weather conditions or logistical blockages.
Automation keeps costs under control
In a sector where speed and cost optimization are essential,automation is an essential strategic lever. It radically transforms logistics management, speeding up processes, reducing errors and improving profitability. Logisticians, true specialists in the sector, exploit the most advanced technological solutions to guarantee ultra-high-performance order fulfillment. At Shippingbo, this expertise is brought to the highest levelthrough ongoing investment in automated management systems, guaranteeing our logistics partners responsive, efficient and perfectly controlled logistics.
The integration between a merchant and a logistician relies entirely on this automated interconnection, thanks to Shippingbo’s OMS , which automatically transmits the merchant’s orders to the logistician’s warehouse.
As soon as an order is placed on an e-merchant’s store, it is automatically transmitted to the logistics provider via a high-performance API. Conversely, the logistician’s inventory is synchronized in real time with the merchant’s sales platforms.
This integration makes it easier for merchants and logisticians to work together: it automates all flows, for 100% reliable data, and immediate order preparation by the logistician.
At the heart of this automation is the WMS (Warehouse Management System), which revolutionizes warehouse management by orchestrating every stage of storage and order preparation. Thanks to this technology, logisticians can monitor their goods flows and inventories in real time. Storage locations are intelligently defined, eliminating manual tasks and human error. The system also automates order prioritization and speeds up order processing, guaranteeing minimum preparation and dispatch times.
At the same time, the TMS (Transport Management System) plays a key role in optimizing shipments for logisticians. Thanks to an advanced algorithm, it automatically selects the most suitable carrier according to cost, lead time, optimal route and many other criteria. This automation ensures that the best carrier is always associated with each order, for maximum optimization of costs and lead times.
Pooling services: more economical logistics
Finally, logistics outsourcing enables e-merchants to optimize their costs, in particular by pooling resources. By taking charge of order preparation and dispatch for several merchants, logisticians maximize the use of their warehouses, infrastructures and equipment. This efficient organization enables them to offer attractive rates to their customers.
Another lever for optimization lies in negotiating transport rates. By consolidating the shipments of several merchants, the logistics provider benefits from larger volumes, enabling it to obtain advantageous pricing conditions from carriers. These savings are then passed on to e-merchants, offering them lower, more competitive transport costs.
Thanks to this pooling, e-merchants benefit from more efficient, competitive logistics, all within a controlled budget.
Are you considering outsourcing your logistics? We can help you choose the right partner for your business, your needs and your objectives:
