The rise in Amazon's shipping costs can be attributable to several factors. This article helps explain some of the reasons while showing you how you can cut costs by taking advantage of free shipping and Amazon Prime deals.
Unless you are a Prime member, Amazon shipping costs can seem pretty high, especially if they accumulate over time. Even before the pandemic, Amazon was reporting an increase in shipping costs.
The surge in shipping costs can be attributed to the enormous investments that Amazon has made in its in-house logistics empire. Consequently, Amazon is spending a higher amount to fulfill each order. The management of Amazon's delivery expenses will determine how profitable it will be in the future. Amazon recovers the majority of its shipping expenses through advertising and membership fees.
Read on to learn more about Amazon’s shipping process and how you can save money when shopping on Amazon.
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Why Is Amazon Shipping So Expensive?
There are a few reasons why Amazon's shipping costs might seem expensive. First, Amazon offers a wide variety of products, many of which are large or heavy, which can increase the cost of shipping. Second, Amazon often has to ship orders over long distances, which can also drive up the cost of shipping. Finally, Amazon offers a number of different shipping options, including same-day, one-day, and two-day delivery, which can be more expensive than standard shipping.
Overall, the cost of shipping an order from Amazon is determined by a combination of factors, including the size and weight of the items being shipped, the distance they need to travel, and the speed at which they need to be delivered.
How Does Amazon Shipping Work?
To understand why Amazon shipping is so expensive, it helps to first understand how Amazon’s in-house logistics work. Let’s get a glimpse into Amazon’s massive warehouse operations.
Amazon has over one million employees responsible for stowing, stocking, picking, and packing packages in its massive warehouses. During the recent pandemic, which saw a surge in online shopping, Amazon hired an extra 40,000 workers. Amazon also increased its air fleet to over 80 aircraft by leasing 12 Boeing 767-300 freight planes. The company also installed 220 package facilities, from massive warehouses to urban distribution stations.
As you can see, Amazon has invested so much in its logistics operations, thus the high shipping prices.
According to David Glick, a former Amazon logistics executive, Amazon is building one of the world's biggest delivery systems. Amazon’s in-house logistics operations are a massive competitive advantage since Amazon does not have to rely on third-party couriers who are usually clogged up in peak seasons such as the holidays.
Factors Affecting Amazon’s Shipping Cost
In addition to covering operation costs, the cost of shipping is influenced by a number of different elements. The following are some of them.
The Number Of Third-Party Sellers On The Platform
Third-party sellers on Amazon account for the majority of Amazon's sales. Amazon allows third-party sellers to dictate the amount they will charge for shipping. The shipping prices can therefore be costly, especially if the product is being shipped overseas.
Please note that even though you have a Prime membership, you will still have to pay for shipping if you are buying the item from a third-party vendor from the marketplace. As a result, the more third-party merchants there are on the site, the more likely it is that you would purchase something from them. As a result, shipping costs may be greater than usual.
The Shipping Destination
One of the significant factors that affect the shipping cost of a product is the shipping destination. The shipping costs are significantly higher in areas where Amazon does not have any fulfillment centers. This is because most products you buy from Amazon come from a fulfillment center close to you, thus drastically reducing the shipping cost.
If the product has to be shipped overseas, the price will be much higher than a shipment made locally.
If you want your product shipped overseas, but Amazon’s shipping cost seems too high, you could try using a package forwarding company instead. Forwarding companies such as Global Shopaholics and My US will get the job done for a lower price (usually).
Package Delivery Speed
As you may know, Amazon provides three shipping tiers: Standard Shipping, Expedited Shipping, and Priority Courier Shipping. The shipping cost is higher depending on how fast you want the product to be shipped to you. For instance, if you are in Asia, standard shipping will cost you $5.99, Expedited Shipping will cost you $10.99, and Priority Courier Shipping will cost you $13.99.
Before you make the order, Amazon will show you the total shipping cost, which will be calculated by adding a base charge and some "Per Item" charges. The per-item price will vary depending on other factors, such as the quantity, weight, and volume of each package.
The Number Of Prime Members
Amazon Prime members enjoy a lot of benefits. Some of the benefits include free shipping and shipping discounts. Amazon Prime, therefore, becomes a massive expense on Amazon’s side. For instance, in one year alone, it costs Amazon over $1.5 billion to cover costs for its one-day delivery for prime members.
Consequently, if the number of Prime members at a time is too high, shipping costs for non-prime members may rise to cover costs.
How to Get Free Shipping At Amazon?
If Amazon’s shipping cost seems too high, worry not. It turns out you can get there are ways to get free shipping for some of your orders (even without a Prime Membership). After doing some digging, we come up with the following two ways to get free shipping on Amazon.
Shop For Lightweight Stuff
In 2015, Amazon launched a free-shipping option for thousands of small items such as mobile phone accessories and cosmetics. You do not need a Prime account for such items, nor will you need to meet a minimum threshold on your purchase.
Prior to this offer, most Amazon had to wait for their shopping cart to exceed $35 to enjoy free shipping. With the new shipping service, you can get free shipping if your order weighs less than eight pounds. Shipping such a product would typically cost you about $10.
Buy More Items
If you are a regular Amazon user, you may be aware that the company offers free shipping for orders that are $25 or more. If you buy a product that costs less than $25, you could buy another inexpensive product to get free shipping.
The high shipping costs on Amazon can be attributed to many factors. Amazon has invested heavily in its in-house logistics operations. To cover the costs of the operations (including that of Amazon Prime deliveries), Amazon has increased the shipping costs.
Other factors that affect the shipping cost include the delivery location and speed. If you want free shipping, you can take advantage of Amazon’s free shipping for products not exceeding eight pounds. However, the best way to save on shipping costs, especially if you shop regularly, is to get a Prime membership