Shipping is one of the highest ongoing costs for any eCommerce business. As carrier rates continue to rise and customers expect fast, affordable (or free) delivery, UK brands are under real pressure to find savings without sacrificing service.
The good news is that small changes to packaging, carrier strategy, and warehouse setup can add up to meaningful savings. Here is how.
1. Understand What Drives Your Shipping Costs
Before cutting costs, it helps to understand where the money actually goes. Shipping costs are typically made up of several components:
- Carrier charges: Pick-up, delivery fees, fuel surcharges, and any additional handling costs
- Packaging materials: Boxes, tape, labels, void fill, and protective wrapping
- Dimensional weight pricing: Many carriers charge based on package size rather than actual weight, so oversized boxes cost more even when the product inside is light
- Shipping zones: The further a parcel travels, the higher the cost. UK zone-based pricing means a parcel from Glasgow to Cornwall costs more than a parcel from Glasgow to Edinburgh
- Returns: Reverse logistics add a second layer of shipping expense that many brands underestimate
A simple audit of your recent shipping invoices will usually highlight the areas where you are overspending. That is the best place to start.
2. Right-Size Your Packaging
One of the fastest ways to reduce ecommerce shipping costs is to stop shipping by air. If your products regularly go out in boxes that are too large, you are paying for empty space on every order.
A few practical steps:
- Measure your most common products and match them to the smallest box or mailer that provides safe protection
- Switch to poly mailers or padded envelopes for non-fragile items like clothing, accessories, or soft goods. These are lighter and smaller, which brings down both weight and dimensional charges
- Reduce void fill by using packaging that fits snugly. Less filler means less material cost and less weight per parcel
- Check Royal Mail and courier size thresholds. A parcel that tips into the next size band (for example, from Large Letter to Small Parcel with Royal Mail) triggers a price jump. Knowing these limits helps you design packaging that stays within the cheaper band
Right-sized packaging also reduces waste, which matters to the growing number of UK consumers who factor sustainability into their buying decisions.
3. Compare Carriers and Negotiate Rates
Sticking with a single carrier out of habit is one of the most common reasons brands overpay for shipping. UK eCommerce businesses have a range of options, including Royal Mail, Evri, DPD, Yodel, DHL, and UPS, and each one prices differently depending on parcel size, weight, destination, and speed.
It is worth reviewing your carrier rates at least once a year. Carriers adjust pricing annually, and what was competitive 12 months ago may not be today. If you ship in any kind of volume, you have leverage to negotiate, so ask.
4. Use a Multi-Carrier Strategy
Rather than choosing one carrier for everything, consider matching the right carrier to each order type. A multi-carrier shipping approach means you can route lightweight parcels through one provider, heavier items through another, and international orders through a specialist.
This does not need to be complicated. Shipping software or a fulfilment partner can automate carrier selection based on parcel dimensions, destination, and required delivery speed. The result is consistently better ecommerce shipping rates across your full range of orders.
5. Place Stock Closer to Your Customers
Shipping zones have a direct impact on cost. The closer your stock sits to the end customer, the less each delivery costs. For UK brands, choosing a well-connected warehouse location can cut average delivery distances and reduce per-parcel spend.
Brands selling into Europe should also consider EU-based fulfilment. Shipping from a warehouse in the Netherlands, for example, avoids the long-haul cross-border costs and customs delays that come with dispatching every EU order from the UK post-Brexit.
6. Reduce the Cost of Returns
Returns are a hidden drain on shipping budgets, particularly in fashion and apparel. January alone sees returns volumes roughly double normal levels across the UK, with carriers processing millions of returned parcels in what the industry calls “Returnuary.”
There are several ways to bring returns costs down:
- Improve product descriptions, imagery, and sizing guides to reduce the number of returns caused by unmet expectations
- Process returns quickly so stock gets back into circulation faster, reducing the need for replacement orders
- Track return reasons and use that data to fix recurring issues at the source
- Offer drop-off returns through networks like Evri ParcelShops or Post Office locations, which are typically cheaper than collection-based returns
7. Set Smart Free Shipping Thresholds
Free shipping drives conversions. Research consistently shows that high shipping fees are one of the top reasons for cart abandonment. But offering free delivery on every order is not always financially viable.
A better approach is to set a minimum order threshold just above your current average order value. If your AOV is £75, try offering free shipping on orders over £90. This encourages customers to add more to their basket, increasing revenue per order and helping offset the delivery cost. You can also offer tiered options: free standard delivery above a set amount, paid express for speed, and an affordable rate for smaller orders.
8. Work With a 3PL to Access Better Rates
Third-party logistics providers ship thousands of parcels daily across their full client base. That volume gives them negotiating power with carriers that most individual brands simply cannot match. A good 3PL will pass those savings on, giving you access to the best shipping rates for ecommerce without needing to negotiate contracts yourself.
Beyond rates, a 3PL can handle multi-carrier selection, packaging optimisation, and returns processing. For brands shipping 500 or more orders a month, this kind of partnership often reduces total fulfilment costs while freeing up time to focus on growth.
“We work with multiple carrier partners and route each order to the best option for speed and cost,” says Cain Fleming, Co-Founder of Green Fulfilment. “That means our clients benefit from volume-negotiated rates they would not be able to access on their own.”
9. Reduce Failed Deliveries
Every failed delivery attempt costs money. The carrier charges for the attempt, the redelivery adds a second trip, and in some cases, the parcel ends up back at your warehouse entirely. For brands shipping hundreds of orders a week, even a small percentage of failed deliveries adds up quickly.
A few practical steps can bring this down:
- Use address validation at checkout to catch typos, missing postcodes, and incomplete details before the order ships. Most eCommerce platforms support address lookup plugins that auto-complete fields from Royal Mail’s PAF database
- Send proactive delivery notifications by SMS or email so customers know when to expect their parcel. Carriers like DPD and Evri offer delivery window alerts that reduce missed deliveries
- Give customers the option to choose a safe place, redirect to a neighbour, or select a pickup point if they know they will not be home
- Review your failed delivery data regularly. If certain postcodes or carriers show higher failure rates, adjust your routing or flag those orders for additional checks
Fewer failed deliveries mean fewer redelivery charges, fewer customer service queries, and less carbon generated from repeat journeys.
10. Use Greener Packaging as a Cost Lever
Sustainability and cost savings are not mutually exclusive when it comes to shipping. Smaller, lighter, recyclable packaging reduces material costs and carrier charges at the same time. When carriers apply dimensional weight pricing, trimming even a few centimetres off each box adds up across hundreds or thousands of orders.
Over 50% of UK consumers now consider sustainability when choosing where to shop. Switching to eco-friendly packaging is not just about doing the right thing: it also helps reduce ecommerce shipping prices and strengthens your brand’s reputation with environmentally conscious customers.
Frequently Asked Questions About Saving on Shipping Costs
What is the cheapest way to ship eCommerce orders in the UK?
It depends on parcel size, weight, and destination. Royal Mail is often cost-effective for lighter items, while couriers like Evri or DPD may offer better rates for heavier parcels. Comparing carriers and using a multi-carrier strategy usually delivers the best results.
How can I reduce shipping costs without slowing down delivery?
Focus on packaging optimisation, warehouse location, and carrier selection. Right-sizing packaging reduces costs without affecting speed. Placing stock in well-connected warehouses shortens delivery distances. A multi-carrier approach lets you pick the fastest affordable option for each order.
Is it worth using a 3PL to save on shipping?
For brands shipping more than a few hundred orders a month, typically yes. 3PLs negotiate bulk carrier rates and manage multi-carrier selection, packaging, and returns on your behalf, often lowering your per-parcel cost.
Can greener packaging actually reduce shipping costs?
Yes. Switching to smaller, lighter, recyclable materials reduces both material costs and carrier charges, especially where dimensional weight pricing applies. It also cuts waste, which is increasingly important to UK consumers.
